The Securities and Exchange Commission (SEC) has ordered Convenience Cash Lending Corporation to stop operating its unregistered lending activities, including those under the names Zada Cash and Bloom Cash.

In a cease and desist order (CDO) issued on May 27, the SEC Financing and Lending Companies Department directed the company to immediately halt all its lending operations, including its declared online lending platforms (OLPs), Zada Cash and Bloom Cash.

This issuance of the CDO follows the company’s failure to comply with the SEC order issued on July 6, 2023, which required OLP operators to register with the Credit Information Corporation, as mandated under the Financial Products and Services Consumer Protection Act and its implementing rules and regulations.

The SEC emphasized that issuing the CDO order is necessary to protect the public and financial consumers from potential fraud, injury, or harm associated with unregistered lending activities.

A total of 401 lending firms have lost their licenses for failure to comply with the reporting requirements of the SEC.

The commission said it has cancelled the primary registration and secondary licenses of the lending companies as part of its campaign against erring firms and its investor protection efforts.

In an order dated May 30, the SEC's Financing and Lending Companies Department (FinLend) revoked the corporate registration of 401 corporations, which had been tagged as delinquent for failing to submit their reportorial requirements.

The subject companies were found to have failed to file their audited financial statements, general information sheet, director or trustee compensation report, and director or trustee appraisal or performance report, and the standards or criteria for the assessment.

Accordingly, their certificates of authority to operate a lending company have likewise been revoked.

In October 2023, the SEC notified the subject companies to take advantage of the Commission’s amnesty program, which allowed companies to settle their fines and penalties for late and noncompliance with reportorial requirements at lower rates.

Failure of the companies to avail of the program resulted in their placement under delinquent status.

Section 177 of Republic Act No. 11232, or the Revised Corporation Code, provides that the SEC may place a corporation under delinquent status for failure to submit their reportorial requirements three times, consecutively or intermittently, within a period of five years.

Under SEC Memorandum Circular No. 19, Series of 2023, corporations with a delinquent status have a period of six months from the receipt of order of delinquency to submit their reportorial requirements.

Failure to comply authorizes the Commission to revoke their corporate registration.