SEC bans online lending platforms for abusive behavior
Due to unfair debt collection practices, including shame on social media and issuing death threats, the Securities and Exchange Commission (SEC) shut down online lending platforms Pondo Loan, Start Loan, Green Loan and Loan Club.
The SEC revoked the Certificate of Authority (CA) of KingABC Lending Corp., which operates these four online lending platforms, in an order dated June 7. SEC Circular Note No.18, 2019 series (SEC MC No.18), which prohibits unfair debt collection practices.
Business regulators found that KingABC threatened borrowers by humiliating them on social media, posting their names as scammers, and contacting people on the borrower’s contact list, although those people were not. named co-creators or guarantors.
KingABC also used obscenities, slurs or profane language and threatened to sue borrowers on the basis of fabricated legal grounds, according to the CGFD.
KingABC had previously been penalized for twice breaking SEC MC # 18. A third violation triggers either a monetary fine, suspension or revocation of the company’s CA, depending on the facts, circumstances and seriousness of the case.
“It is also clear that at this point, the revocation of the Respondent’s CA is not simply appropriate, but rather necessitated by the seriousness and number of his infractions,” said the CGFD.
Besides the 15 violations, KingABC faces 53 other complaints.
“Even more revealing is the fact that following the issuance of the formal charge, the Respondent’s abusive collection practices only worsened and became more hostile based on the evidence submitted by the complainants.
The department noted messages filled with death threats, profanity and other heinous and objectionable language, ”the SEC said.
—Doris Dumlao-Abadilla INQ
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