Senator Raffy Tulfo seeks a Senate investigation on the alleged unfair debt collection practices of lending companies involving harassment of borrowers and other abusive means to collect payments.
Tulfo stressed the need for a probe to solve the mounting complaints number of against abusive lenders in the industry.
In his Senate Resolution (SR) No. 746, Tulfo lamented that some lending companies even post libelous and defamatory articles on social media buy and sell groups, collecting payments from random contacts of their borrowers, and sending coffins and death threats.
Despite the laws and regulations, Tulfo divulged that there was 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.
He 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.
He cited 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.
The law also prohibits practice of contacting persons in the borrower’s contact list other than those who were named as guarantors or co-makers.