The Securities and Exchange Commission (SEC) has secured a new conviction against illegal lending.
The Pasay City regional trial court has convicted X-CEE789 Lending and Trading Inc. for falsifying documents for its registration as a lending company, the SEC said in a statement.
The Pasay City Regional Trial Court Branch 118 court sentenced accused incorporators and directors of X-CEE789 – with a fine of at least P10,000 each for the violation of the Lending Company Regulation Act of 2007 (LCRA or RA9474).
“The SEC filed the criminal complaint against the respondents upon finding that they made a false statement in their application for the incorporation of X-CEE789 and issuance of its authority to operate, as mandated by the LCRA,” the SEC said.
X-CEE789 submitted a Certificate of Bank Deposit in the amount of P1 million, purportedly issued by Banco de Oro-Two Shopping Center Branch in Pasay City, to comply with the minimum paid-up capital prescribed by the LCRA during its registration as a lending company with the Commission in 2017.
“Upon verifying with the bank, however, the SEC found that no such certificate was issued to X-CEE789. The Commission subsequently denied the company’s application for registration as a lending company,” the SEC said.
“For knowingly and willingly making a false statement in their Articles of Incorporation and submitting a falsified Certificate of Bank Deposit that the law requires lending companies to file, the accused have clearly violated Section 12(3)(a) of RA 9474,” the Pasay court ruled.
“Per their own admission, the accused (incorporators and directors) never made any capital contribution at all…they said that they held on to their money because they believe that they will only give their contribution after the corporation has been registered and started operating as a lending company,” the court said.
“This is a willful violation of the law for which the accused cannot be excused,” it added.
The SEC said 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.
“In the eight cases decided so far, the concerned trial courts found 71 individuals, 33 of whom are foreigners, guilty beyond reasonable doubt of violating the LCRA,” it said.
The SEC said it has revoked the primary registration of 2,081 lending companies to date for non-compliance with the LCRA.
