The Securities and Exchange Commission (SEC) has revoked the license of Cashtrees Lending Corp. for launching and operating unregistered online lending platforms amid a moratorium imposed by the commission.
In an order dated March 16, the SEC found that Cashtrees Lending committed eight violations regarding the moratorium of new online lending platforms.
The lending company also committed another eight violations on the disclosure requirements on advertisements of financing companies and lending companies and reporting of online lending platforms.
“The findings were supported by the results of the joint operation of the SEC Enforcement and Investor Protection Department (EIPD) and the Philippine National Police Anti-Cybercrime Group on February 12 for the implementa-tion of a warrant to search, seize, and examine computer data against Cashtrees Lending,” the SEC said in a media release.
In its report following the operation, Cashtrees Lending was found to have launched and operated eight unrecorded online lending platforms (OLPs) after the moratorium took effect on Nov. 2, namely: Rush Loan, Easy Money, Good Pocket, Lucky Start, Swipe Cash, 365 Cash, Mega Loan, and Gold Peso.
The SEC said it imposed the moratorium in response to the “emergence of financial technology companies engaging in predatory lending, taking advantage of cash-strapped Filipinos in need of quick loans by charging high inter-est rates and imposing strict payment terms.”
Cashtrees Lending also failed to comply with the requirement that lending and financing companies must report their OLPs to the commission prior to their launch and operation.
Lending companies must also disclose in their advertisements and OLPs’ specific information, such as their corporate names, SEC registration numbers, and certificates of authority.
“Due to the multiple violations committed by [Cashtrees Lending] in launching the eight unrecorded OLPs and due to the additional violations… [Cashtrees Lending] showed its wanton disregard of the commission’s rules and reg-ulations,” the revocation order read.
“As the online lending industry is strictly regulated, companies who are either unwilling or unable to comply with the rules imposed cannot be allowed to continue to operate,” it added.
The revocation of Cashtrees Lendings brings to 37 the total number of financing and lending companies with canceled licenses due to various violations.
To date, the SEC has also revoked the primary registration of a total of 2,082 lending companies for their failure to secure the requisite secondary licens