The Philippine Securities and Exchange Commission has fined LHL Online Lending Inc., operating as Pautang Online and Pautang Peso, for providing misleading information in its loan agreements in violation of the Truth in Lending Act as implemented by SEC Memorandum Circular No. 7, Series of 2011. The SEC Financing and Lending Companies Department ordered the company to pay a PHP 129,000 penalty following multiple complaints filed against the firm and its online lending platforms. An SEC investigation found that the company’s disclosure statement stated repayment terms of 150, 180, or 210 days, but borrowers were in practice given a shorter repayment period and then charged hidden surcharges and interest when unable to meet the shorter deadline. The SEC cited Section 4 of the Truth in Lending Act, which requires creditors to provide borrowers, before consummation, a clear written statement of key transaction terms and charges. The Financing and Lending Companies Department warned that any subsequent violation may result in cancellation of LHL Online Lending’s primary registration and certificate of authority to operate as a lending company.

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