Eight Lending Company Officers Were Found Guilty by the SEC of Misrepresenting Registration Documents

The Securities and Exchange Commission (SEC) has chalked up another successful prosecution by having eight officers of lending company Phil86 Gurunanak Lending and Trading Corp. convicted for submitting falsified documents for their company registration with the Commission.

In a decision dated July 4, the Pasay City Regional Trial Court Branch 112 found Nicanor Borong, Nelson Henson, Irene Romero, Michael Ligaray, Regina Elizon, Gurjant Singh, Harnaib Singh, and Gurmeet Kaur guilty beyond reasonable doubt of violation of Section 12, Paragraph 3(a) of Republic Act No. 9474, or the Lending Company Regulation Act (LCRA).

The court accordingly sentenced each of the officers to pay a fine of P10,000.

The decision comes after the officers entered a guilty plea to the act of falsifying their company registration documents. Another officer, Tarsem Singh Dhaliwal, is set to be re-arraigned on August 1 to reflect his guilty plea.

The SEC filed the criminal complaint against the officers after finding that they made a false statement in their application for the incorporation of Phil86.

The group 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. The Commission subsequently denied the company’s application for registration as a lending company.

Section 12, paragraph 3(a) of the LCRA penalizes any officer, employee or agent of a lending company who shall knowingly and willingly make any false or misleading statement with respect to any material fact in any application, report, or document required under the law.

This marks the 10th conviction scored by the SEC for violation of the LCRA, with a total of 86 individuals already convicted. The Commission has likewise secured two judgments of conviction under the RPC, with a total of 12 individuals convicted.

To date, the SEC has cancelled the licenses of 39 financing/lending companies due to various violations of applicable rules and regulations. A total of 58 online lending applications have also been ordered to cease operations for lack of authority to operate as a lending or financing company.

​The SEC, through the Corporate Governance and Finance Department, has likewise revoked the primary registration of a total of 2,084 lending companies to date for non-compliance with the LCRA.