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Pasay RTC returns conviction against illegal lender

THE Securities and Exchange Commission (SEC) said it obtained its eighth conviction against an illegal lender after a regional trial court (RTC) ruled against executives of X-CEE789 Lending and Trading, Inc.

In a statement Tuesday, the regulator said the Pasay City RTC Branch 118 found X-CEE789 guilty beyond reasonable doubt for violating Section 12 (3)(a) of Republic Act No. 9474 or the Lending Company Regulation Act (LCRA) of 2007.

“The conviction of the incorporators and directors of X-CEE789 represents the eighth conviction the SEC has won under a crackdown initiated in 2017 on illegal lenders, including those engaged in ‘5-6’ schemes and other usurious practices,” the SEC said.

The ruling, dated Jun. 30, covers X-CEE789 executives Merlinda A. Derequito, Mila R. Anonuevo, Haydee S. Alarcon, Maria Collen A. Custodio, Marisa D. Abaquin, Ramona C. Belen, Pinder Kaur Bhopal, Parvesh Kumar, Karan Kumar, Surinder Bhopal, Kamaljit Kaur, and Jaswinder Kaur.

Each of the respondents that established the company as incorporators and served as directors was ordered to pay a fine of P10,000 with costs.

Under Section 12 (3)(a) of the LCRA, officers, employees, or agents of a lending company who knowingly mislead or give false statements in any official application, report, or document face fines of P10,000 to P50,000 and/or imprisonment of six months to 10 years.

The SEC filed a complaint against the respondents after they were found to have falsified documents when incorporating X-CEE789 and while applying for an authority to operate.

X-CEE789 submitted a P1-million certificate of bank deposit supposedly issued by Banco de Oro’s Two Shopping Center branch in Pasay City. The document was needed to prove its compliance with the minimum paid-up capital prescribed by the LCRA during X-CEE789’s registration as a lending company with the SEC in 2017.

However, the SEC found that the bank did not issue the certificate. The commission also denied X-CEE789’s application when it registered as a lending company.

The regulator noted that in the eight cases decided so far, trial courts found 71 individuals guilty beyond reasonable doubt for violating the LCRA. Out of the 71 individuals, 33 are foreigners.

Meanwhile, the SEC’s Corporate Governance and Finance Department (CGFD) has revoked the registration of 2,081 lending companies for their non-compliance with the LCRA.

“To date, the SEC has also canceled the licenses of 35 financing/lending companies due to various violations of applicable rules and regulations. A total of 58 online lending applications have likewise been ordered to cease operations for lack of authority to operate as a lending or financing company,” the commission said. — Keren Concepcion G. Valmonte 

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