SEC tightens requirements for online ads of lending firms

MANILA, Philippines — The Securities and Exchange Commission (SEC) has tightened the requirements governing online advertisements of financing and lending companies.

This developed as the SEC has received numerous reports of predatory and fraudulent schemes advertised online, with some even soliciting investments from the public.

Many financing and lending companies have turned to different platforms available online as the use of the internet has grown exponentially because of the COVID-19 pandemic, which necessitated work-from-home setups and online schooling.

These entities, the SEC said, must fully disclose the advertisements they publish especially on their online platforms.

They also need to submit the affidavit of compliance, which contains a report of all existing online lending platforms as well as a list of all their prospective online lending platforms that are still to be developed or utilized.

The SEC said the commencement of operations of the online lending platforms without submission of the required affidavit of compliance and submission of false or fraudulent requirements would be penalized and slapped with fines.

“Continuous failure to comply despite being given notice of violations and an opportunity to make the necessary corrections shall constrain the commission to revoke the company’s certificate of authority to operate as a financing/lending company,” the SEC said.

The SEC earlier mandated all financing and lending companies to submit a program for the prevention of money laundering and terrorist financing.

“As covered persons (CPs) supervised and regulated by the SEC, you are required to formulate and implement a comprehensive and risk-based Money Laundering and Terrorist Financing Prevention Program (MTPP),” the SEC said.