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[av_heading heading=’Tough drive vs ‘5-6’ loan sharks effective – SEC ‘ tag=’h3′ style=’blockquote modern-quote’ size=” subheading_active=’subheading_below’ subheading_size=’15’ padding=’10’ color=” custom_font=”]
By ADRIAN STEWART CO
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Thursday, March 2, 2017
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MANILA – The Securities and Exchange Commission (SEC) on Monday said around 200 informal lenders have applied for registration for the “5-6” loan sharks and other usurious practices.
In a press statement, the SEC said the development was after President Rodrigo Duterte’s directive for the government to get tough against “5-6” lenders, which is usually being done by Indians.
“Five-six” lenders mostly extend loans without collateral or any documentary requirements, but charge their borrowers an excessive nominal interest rate of 20 percent or more over an agreed period.
“The SEC has initiated investigation into the activities of suspected informal lenders for possible filing of criminal complaints,” said SEC chairperson Teresita Herbosa in a report submitted to Finance Secretary Carlos Dominguez.
“Apart from charging them with violation of Republic Act 9474 (Lending Company Regulation Act), the SEC is likely to include the charge of violation of the Truth in Lending Act which likewise imposes fine and/or imprisonment. Foreign informal lenders will be referred to the Bureau of Immigration,” she told Dominguez.
Herbosa also said they are now looking into online advertisements, flyers, text messaging promos, and overt and collection activities in areas like public markets to investigate and expose informal lenders and file appropriate charges against them.
The SEC-led investigations were conducted late last year with the help of local government units, Department of Trade and Industry, National Bureau of Investigation and law enforcement agencies.
Following Duterte’s directive, the SEC issued advisories to inform the public about prohibited lending practices under the law and encourage informal lenders to register with the Commission.
“The Commission also allowed SEC-registered lending companies without the required CA to apply for this requirement provided that they apply for and secure it on or before April 30, 2017,” Herbosa said./PN
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