Recruiters use ‘loan contracts’ to collect fees from OFWs

MANILA, Philippines - Some recruiters are resorting to loan contracts to collect placement fees from Filipinos seeking employment in Hong Kong, an official said yesterday.

Philippine Overseas Employment Administration chief Hans Cacdac said they have received information on the new scheme of some recruiters to get around the regulation against collecting placement fees.

Cacdac said reports from the Philippine Overseas Labor Office in Hong Kong revealed that Filipino workers are brought to a lending company either in the Philippines or Hong Kong to sign a loan agreement.

Though the workers are obliged to pay back the loan, they don’t get to keep the money – the recruitment firms do, he said.

The recruitment agencies based in Hong Kong keep the worker’s passport or employment contract until the worker pays back the entire loan.

Cacdac said the recruitment agencies also assist the worker in opening a savings account and then keep the ATM card.

“The employer is then advised to deposit the salary of the worker to that account and the agency withdraws the worker’s salary, and after getting its share as monthly payment for placement fee, gives the remaining cash to the worker,” labor attaché Manuel Roldan said.

Cacdac warned that Hong Kong-based recruitment agencies could lose their accreditation with the Philippine government once they found guilty of collecting placement fees from workers even in another form.