Senator Raffy Tulfo is seeking a Senate investigation on the rampant unfair debt collection practices of lending companies that allegedly harass borrowers and employ abusive means to collect debt.
In filing Senate Resolution (SR) No. 746, Tulfo lamented that some lending companies are even posting libelous and defamatory posts on social media buy and sell groups, collecting payments from random contacts of their borrowers, and sending coffins and death threats.
Section 1 of Securities and Exchange Commission (SEC) Memorandum Circular No. 18, series of 2019, in relation to Section 4.4 of the Implementing Rules and Regulations of Republic Act No. 11765 or the “Financial Products and Services Consumer Protection Act” specifically prohibits financial service providers from making use of threats to take any action against their clients.
It also prohibits the practice of contacting persons in the borrower’s contact list other than those who were named as guarantors or co-makers.
“Despite the laws and regulations, there is still an alarming number of lending companies employing abusive debt collection practices to the detriment of consumers.”
Despite the foregoing laws and regulations, the legislator divulged that there is still an alarming number of lending companies failing to disclose their online lending platforms and employing abusive debt collection practices to the detriment of consumers.
The lawmaker added that these lending companies also commit significant violations of Republic Act No. 10173 or the “Data Privacy Act of 2012”, with most of the companies facing numerous complaints with the National Privacy Commission.
Tulfo stressed the need for an investigation to solve the rising number of complaints against abusive lenders in the country.
