The Securities and Exchange Commission (SEC) has revoked with finality the certificate of authority (CA) of Populus Lending Corporation to operate as a lending corporation.
This is because of the firm’s unlawful debt collection practices and failure to disclose its online lending platforms (OLPs) to the SEC.
In an order, the SEC Financing and Lending Companies Division (FinLend) found that Populus Lending has committed several violations of SEC Memorandum Circular No. 18, Series of 2019 (MC 18) on the Prohibition on Unfair Debt Collection Practices.
The company was also found to have violated SEC Memorandum Circular No. 19, Series of 2019 (MC 19) requiring financing and lending companies to disclose all of the OLPs they operate to the Commission.
The case stemmed from nine formal complaints and 355 informal complaints filed by former Populus Lending clients from September 2022 to March 2023, alleging that the company resorted to using threats, obscene language, false representations, and doxing tactics, or using information about an individual with malicious intent, in their debt collection practices.
The complainants cited receiving threatening messages, aggressive comments on their Facebook posts, sending demand messages to people not involved in the loan but are acquainted with the complainants, and threatening to black-list them in all financial institutions, among others.
MC 18 expressly prohibits the use of threats, insults, obscenities, profane language, and any false representations or deceptive means to force any individual to pay their debts.
The guidelines also preclude lending and financing companies from contacting people in the borrower’s contact list without their consent, among other conditions.
Meanwhile, the implementation of a search warrant by the Philippine National Police Anti-Cybercrime Group (PNP-ACG), together with the SEC Enforcement and Investor Protection Department, in July 2022 revealed that Populus Lending had been operating Pesopop, Antwallet, Dragonloan, Catcash, Topeso, Takecash, Pesohere, Weagle, Cocopeso, Cashin, Candycash, and Cashcow in its Pasig City office.
Data from the SEC Corporate Governance and Finance Department show that Populus Lending only has four registered OLPs with the Commission, namely Pesopop, PesoCow, NewCash, and LuckyLoan.
MC 19 requires lending and financing companies to regularly submit an Affidavit of Compliance to the Commission to ensure that their OLPs are duly registered with the SEC.
“Based on the digital forensic examination conducted onsite on 22 July 2022, particularly the seized devices, and the voluntary statements of the collection agents, [Populus Lending] and its collecting agents were operating and using 13 online lending applications (OLPs), not four OLPs,” the revocation order read.
It added that, “simply put, we find that [Populus Lending] violated the above-cited SEC Circulars and exercised misrepresentation and deceit.”
The Commission previously issued a cease and desist order against Populus Lending on June 26, 2023 for its unfair debt collection practices.
Given the company’s failure to appeal the revocation order, the SEC through an order dated August 1 resolved to make the decision final and executory.
“Wherefore, in view of the foregoing, and in accordance with [the 2016 Rules of Procedure of the SEC], the Order revoking the Certificate of Authority to Operate as a Lending Company (CA No. 3066) of Populus Lending Corporation is FINAL AND EXECUTORY,” the order stated.
