By James A. Loyola
The Securities and Exchange Commission (SEC) has shut down 836 more companies engaged in lending activities without the necessary license as it continues its crackdown on illegal lending.
The SEC Corporate Governance and Finance Department (CGFD) revoked the registration of the latest batch of corporations and partnerships that registered as lending companies but failed to obtain the required Certificate of Authority to Operate as Lending Company (CA).
Section 4 of Republic Act No. 9474, or the Lending Company Regulation Act of 2007, requires that a lending company be established only as a corporation.
It further provides that “no lending company shall conduct business unless granted an authority to operate by the SEC.”
Any person who shall engage in the business of lending without a validly subsisting authority to operate from the SEC may face a fine ranging from P10,000 to P50,000 or imprisonment of six months to 10 years or both, under Section 12 of the Lending Company Regulation Act.
On November 14, 2016, the Commission allowed SEC-registered lending companies without the required CA to apply for and secure it on or before April 30, 2017.
To date, a total of 2,783 lending companies have obtained the required certificate of authority from the SEC in order to engage in the business.
On the other hand, the Commission has revoked the registration of 2,080 lending companies. It continues to validate the authority of more corporations that engage in lending activities.
The Commission En Banc also resolved to revoke the certificate of authority of Z.C. Buen Mano Lending Corporation for failure to comply with the reportorial and other compliance requirements prescribed by the Commission.