DOJ warns vs. unlawful debt collection practices: Where to file complaints?

MANILA, Philippines — The justice department has issued a public advisory for those at the end of harassment and unlawful debt collection practices from online lending companies.

The Office of Cybercrime under the justice agency has received reports that certain online lending companies (OLC) engaged in “unfair debt collection practices and cyber harassments” when those who borrowed from them or debtors failed to pay.

These include accessing debtor’s contact list and sending them messages in event of delayed or non-payment; posting their personal information online to shame them; threatening them with death or physical injuries or using profane language to debtors’ and their references again to shame them.

“This Public Advisory is being issued to inform the public of the steps to be undertaken when they become victims of unfair collection practices committed by OLCs,” it said. An advisory will also serve as warning to online lending companies not to engage in unlawful acts in debt collection.

Relevant laws

Republic Act 10175 or the Cybercrime Prevention Act of 2012: When the online lending company gains access to the debtors’ phone book or contact list to send them messages, “they are accessing to a computer system without a right,” a crime under the anti-cybercrime law Section 4(a)(1).

The cybercrime office said that while debtors’ may initially consented to the OLC’s mobile application, the consent is limited to matters to assist the company for processing of the loan and nothing more.

OLCs that resort to public and malicious imputation of a vice, defect or crime such as posts of “magnanakaw, patay gutom or estafadora” may also be held liable for cyber libel or Section 4(c)(4) of RA 10175.

RA 10173 or the Data Privacy Act of 2012: OLC accessing debtors’ contact list to send messages is punishable under this law’s Section 25 and 28.

Section 25 punishes unauthorized processing of personal information and sensitive information with imprisonment and fine up to P4 million. Section 28 meanwhile states that processing of personal information and sensitive personal information for unauthorized purposes shall be penalized with imprisonment and fine up to P2 million.

OLCs posting online their debtors’ information obtained through loan application to shame them may be held liable under RA 10173’s Section 31 that punishes malicious disclosure.

Revised Penal Code: Online lending companies may also face violations for grave or light threats, or grave or light coercions, or under relation in relation to the Cybercrime Prevention Act of 2012.

The cybercrime unit explained that if a debtor is threatened with death or physical injuries and/or be subjected to a public disclosure of personal information online with a “scammer” caption, this may fall under grave threats. Since the threat was committed through information and communications technology, the crime becomes one degree higher than as provided under the RPC.

Securities and Exchange Commission Memorandum Circular No. 18, series of 2019: This circular prohibits unfair debt collection practices and provides that for collection, financing companies and lending companies must keep data on borrower strictly confidential, except under certain circumstances.

Violators may face a fine from P25,000 up to P1 million or suspension of lending activities. Certificate of Authority to operate may also be revoked, the DOJ-OOC said.

What to do now?

If unlawful acts have been committed, the justice portfolio advises the following actions:

File complaints before the Office of the Prosecutor. In cases of unauthorized access of phonebook or contact list; use of threat to harm physical person, reputation or property; or use of obscenities and insults published online  — and they know the identity of the offender — they may file complaints before the Office of the Prosecutor where the crime may be committed.

These acts are punishable under Cybercrime Prevention Act of 2012 or the Revised Penal Cdoe.

Seek NBI or PNP’s cybercrime teams. If the said acts were committed against them but they are unsure of the identity of the offender, they may file raps before the National Bureau of Investigation-Cybercrime Division or the Philippine National Police’s Anti-Cybercrime Group.

These government agencies may conduct investigation following their filing.

Ask the National Privacy Commission. In cases of malicious disclosure of personal information or sensitive personal information, and when guarantors or co-makers are contacted, they may file complaint before the privacy watchdog.

Report to government agencies. Authorities stressed that complaints may be filed simultaneously.

Victims of unlawful debt collection practices are also encouraged to report the online lending company to the PNP-Anti-Cybercrime Group, NBI-Cybercrime Division, NPC, and the Securities and Exchange Commission. — Kristine Joy Patag