The Securities and Exchange Commission (SEC) has stripped Super Cash Lending Corp. off the authority to operate as a lending company, citing its abusive and predatory debt collection practices.
Based on an order dated Nov. 11, the SEC corporate governance and finance department (CGFD) found Super Cash liable for nine violations of SEC Memorandum Circular No. 18, Series of 2019, which prohibited financing and lending companies from using unfair debt collection practices.
“We respect the right of lending and financing companies to formulate and adopt certain strategies to effectively collect debts and secure their profitability,” SEC Commissioner Kelvin Lester Lee said in a statement on Monday.
“However, harassment and other abusive or predatory practices will never be acceptable and tolerated. As we pursue erring lending and financing companies, we also advise the public to be cautious and mindful of their transactions with entities representing themselves as such.”
The CGFD found the company, through its online lending platforms Super Cash, Cash Porter, and Loan Bee, guilty of threatening borrowers with shaming on social media through the publication of their loan and personal details. Delinquent borrowers were also harassed with threats of estafa and theft charges.
Super Cash likewise threatened borrowers with blacklisting by the National Bureau of Investigation. Its collection agents also used profane and abusive language to collect debts, according to the CGFD.
The CGFD added: “Worse, in one of the screen captures submitted by one of the complainants, messages showing threats of inflicting grave physical harm upon the person of the complainant could be seen. These unfair collection practices are all too obnoxious to ignore.”
A third violation of SEC MC 18 triggers the imposition of either a monetary fine, suspension, or revocation of the company’s certificate of authority (CA), depending on the facts, circumstances, and gravity of the case.
“[T]he revocation of respondent’s CA is not merely appropriate, but rather necessitated by the gravity and number of its offenses,” the CGFD said.
SEC MC 18 took effect on Sept. 8, 2019, as part of the corporate regulator’s response to several complaints for unreasonable, abusive, and unfair practices that lending and financing companies used in order to collect debt from borrowers.
Earlier this year, the SEC also revoked the CA of FCash Global Lending Inc. due to its unfair debt collection practices.