SEN. Ana Theresia “Risa” Hontiveros has recently called for an investigation into the alleged abusive and “possibly illegal” debt collection practices of online companies. In a resolution filed as Resolution 882, the senator aims to shed light on the reports that these online money lending operations have been used to mask illicit cross-border money flows.
One notable incident that prompted this call for investigation was the case of an online lending company that sent a funeral hearse to the residence of one of its debtors with an overdue loan. This act was seen as a “death threat” and raised concerns about the inhumane treatment of debtors. Senator Hontiveros emphasized that while debts must be settled, debtors should not be subjected to such harassment and turmoil.
Unfortunately, this kind of harassment is not new. For several years, countless Filipinos have found themselves not only deep in debt but also victimized by profane language, a barrage of messages and calls threatening violence, illegal access to contacts lists and file folders, blatant misuse of personal information, public shaming, defamation, and the imposition of exorbitant interest rates, often as high as 15 percent per month.
In the Philippines, lending companies are regulated and supervised by the Securities and Exchange Commission (SEC) under the “Lending Company Regulation Act” (Republic Act 9474). However, the Philippine National Police Anti-Cybercrime Group (PNP-ACG) has revealed that many of the perpetrators behind these abusive practices are foreign-based entities operating lending activities without authorization from the SEC.
According to Senator Hontiveros, this online lending model appears to have originated in the Chinese mainland, with Chinese fintech lenders using the phone contact lists of their borrowers to harass their colleagues, family, and friends. These actions not only contravene the rules set by the SEC but also constitute violations of various laws, including the Revised Penal Code, the Data Privacy Act (RA 10173), the Cybercrime Prevention Act (RA 10175), and the Financial Products and Services Consumer Protection Act (RA 11765).
Despite efforts to regulate the industry, illegal and unfair debt collection practices continue to proliferate, seemingly protected by anonymity. These practices disproportionately affect the most vulnerable Filipinos who rely on small short-term loans to meet their day-to-day expenses. Senator Hontiveros’s call for an investigation aims to address these issues and ensure the protection of consumers from abusive debt collection practices.
It is crucial to tackle this issue not only to safeguard the rights and well-being of debtors but also to maintain the integrity of the lending industry. By holding accountable those responsible for these abusive practices, the government can foster an environment of trust and confidence in online lending platforms. Furthermore, it is essential to strengthen regulations and enforcement mechanisms to prevent the recurrence of such incidents and protect the financial interests of individuals seeking short-term loans.
In conclusion, Senator Hontiveros’s call for an investigation into the abusive debt collection practices of online companies highlights the urgent need to address this issue. By shedding light on these practices and holding perpetrators accountable, the government can ensure the protection of consumers and maintain the integrity of the lending industry.
Source: The Manila Times