The Securities and Exchange Commission (SEC) announced on Thursday that it had ordered three online lending companies Golden Cash, Help Cash, and Grace Cash, to cease operations due to a lack of regulatory approval.
SEC ordered the three lending firms “to immediately cease and desist from engaging in, carrying out, promoting and facilitating any lending activity/transaction until they have secured the necessary registration and license from the commission.”
“The owners, operators, promoters, representatives, and agents of the online lending operators were likewise directed to stop from engaging in unfair debt collection practices, as defined under SEC Memorandum Circular No. 18, Series of 2019 (MC 18),” the corporate regulator said.
The SEC also ordered the three online lending companies to stop offering and advertising their loan services on the internet or through any other medium and delete all materials related to them.
Golden Cash, Help Cash, and Grace Cash are not registered as corporations with the Securities and Exchange Commission, according to the regulatory agency.
“As such, they cannot secure a Certificate of Authority to Operate as a Lending/Financing Company,” it said.
SEC closes Golden Cash, Help Cash, and Grace Cash lending firms
“[T]he Commission finds that the continued operations of Golden Cash, Help Cash, and Grace Cash constitute a clear violation of, and should be penalized pursuant to the [LCRA] because it engages in or carries out a lending business without the required license from the Commission,” the SEC said.
Furthermore, the regulator stated that research by its Enforcement and Investor Protection Department found that the three online lending companies used unfair collection techniques, which are forbidden under MC 18.
According to the EIPD, online loan companies have been harassing, threatening, and publicly humiliating their debtors and imposing hidden costs and excessive processing fees.
“The acts of these unregistered online lending operators in illegally offering and providing loans to the public, charging high interest rates, and subjecting its debtors to unfair treatment through abusive and even libelous language in collecting the loaned amount…have no place in a society that is governed by and faithfully adheres to positive laws,” it said.
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