The Securities and Exchange Commission (SEC) has cancelled the license of lending firm Copperstone Lending Inc., citing unfair debt collection practices and failure to disclose the true and correct terms of loan contracts with borrowers and slapped the company with a P20,000 fine.
Copperstone Lending operates online lending platforms (OLPs) Quickla, Pococash, Blue Peso, Peso Forrest, Moca Moca, Pesobuffet and Load Cash.
The SEC said the company violated Republic Act 3765 or the Truth in Lending Act as well as SEC Memorandum Circular (MC) 18-2019 which states the prohibition on unfair debt collection practices.
The license revocation and fine were issued in response to several complaints filed with the SEC regarding Copperstone Lending’s lending platforms.
The SEC said its investigations showed Moca Moca disbursed loan amounts to borrowers without informing them of the exact amount involved as well as the interest on overdue payments.
Moca Moca was also found to be falsely advertising terms of the loan contract compared to what was actually contracted with borrowers.
The SEC said lending companies are required to disclose to borrowers the cash price or delivered price of the property or service to be acquired; amounts, if any, to be credited as down payment and/or trade-in; the difference between the aforementioned amounts; charges which are paid or to be paid in connection with the transaction; and the total amount to be financed, among others.
“(Copperstone Lending), in stating in its disclosure statement that the loan term is for 180 days, while in truth and in fact, the consumer will be given a lesser period to pay, and in imposing hidden surcharges and interests for not being able to settle the loan for a shorter period, negates the noble intent of the law to give awareness to the true cost of credit,” the SEC said.
“Complaints against Moca Moca and Pesobuffet further show that the OLPs threatened borrowers with the filing of estafa cases and sent messages to phone contacts not named as the borrower’s guarantors and references, among other debt collection tactics,” the SEC added.
The regulator said MC 18 prohibits the use of unfair debt collection practices, including the use or threat of use of violence to harm the person, reputation or property of any person; the use of obscenities, insults or profane language; as well as the disclosure or publication of names of borrowers who allegedly refuse to pay debts, among others.
“(Copperstone Lending) violated (provisions of MC 18) for the use of threats to take any action that cannot be legally taken and by contacting the persons in the borrower’s contact list other than those named as guarantors or co-makers,” the SEC said.
