The Philippines Securities and Exchange Commission (SEC) has imposed a PHP 1 million fine against Surity Cash Lending Investors Corporation for engaging in unfair debt collection practices.

In a decision dated 16 September, the Commission En Banc found Surity Cash liable for three violations of SEC Memorandum Circular (MC) No. 18, Series of 2019, which prohibits financing and lending companies from using abusive or unfair methods to collect debts.

According to the SEC, Surity Cash committed two counts of violating Section 1 of the circular, which specifically forbids the use of threats of violence, obscenities, insults, or profane language in debt collection. It also prohibits disclosing the personal information of borrowers who refuse to pay.

The SEC also found that the company violated Section 4 of the memorandum by submitting its sworn certification late.

The memorandum requires certification to prove a company has established a customer service department to handle borrower complaints, and the section also mandates that collection personnel must disclose their full identity to borrowers.

While the SEC allowed Surity Cash to keep its corporate registration, the Commission En Banc issued a stern warning.

“While this Commission is not imposing the penalty of suspension or the supreme penalty of revocation at this time, unfair or abusive debt collection and recovery practices have no place in the lending/financing industry,” the decision read.

The commission added that the decision should be considered a “stern and final warning,” noting that “a repeated violation… will be dealt with more severely”.

Featured image: Edited by Fintech News Philippines based on images by fabrikasimf via Freepik and the International Bank Note Society.