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SEC bags 8th legal victory in crackdown vs illegal lending

December 07, 2021 - Tuesday 5:12 PM by GDM

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Corporate regulators said Tuesday it scored another legal victory after a regional trial court convicted the incorporators and directors of X-CEE789 Lending and Trading, Inc. for submitting falsified documents for its registration as a lending company.

In a statement, the Securities and Exchange Commission (SEC) said the Pasay City Regional Trial Court Branch 118 found the officials of X-CEE789 guilty beyond reasonable doubt of violating Section 12(3)(a) of Republic Act No. 9474, or the Lending Company Regulation Act of 2007 (LCRA).

The company officials that were convicted are Merlinda A. Derequito, Mila R. Anonuevo, Haydee S. Alarcon, Maria Collen A. Custodio, Marisa D. Abaquin, Ramona C. Belen, Pinder Kaur Bhopal, Parvesh Kumar, Karan Kumar, Surinder Bhopal, Kamaljit Kaur and Jaswinder Kaur.

The court accordingly sentenced each of the respondents, who formed X-CEE789 as incorporators and directors, to pay a fine of P10,000, with costs.

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.

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.

To date, the SEC has cancelled the licenses of 35 financing/lending companies due to various violations of applicable rules and regulations. A total of 58 online lending applications have likewise been ordered to cease operations for lack of authority to operate as a lending or financing company.