EDITORIAL - Illegal online lending

Even before the pandemic, there have been complaints about illegal online lending activities and the ensuing harassment of those who fail to pay or are delayed in their payments. So it’s good to know that the Philippine National Police has busted a group on charges of operating such a scam. What’s noteworthy is the size of the operation: 83 people working as collection agents were arrested by the PNP Anti-Cybercrime Group in a raid last Friday on the suspects’ office in Sampaloc, Manila.

The PNP-ACG said that the 83, whose names were not immediately released, were caught in the act of sending threatening messages to clients. Apart from the lending scheme being unlicensed, the suspects allegedly dealt with delinquent borrowers by unlawfully accessing their personal information and posting these online. They also allegedly threatened to do the same to other borrowers if they defaulted on their payments.

Police said victims were lured through advertisements and promotions offering instant loans on social media. The suspects face charges for violating the Data Privacy Act and corporate regulations as well as for cyber libel and grave threats.

In other cases, scammers have also posed as newspaper editors and threatened to publish the names of borrowers who defaulted on their loan payments. Several victims avoided the harassment by verifying the threat with the publications.

The public should be glad to know that authorities have the capability to go after such cyber scammers. The concern is that the case is just the tip of the iceberg. Online financial fraud surged as the pandemic lockdowns compelled people to resort to digital financial transactions. Most people did so with zero awareness of the risks of online fraud and their data privacy rights. Even teachers have been victimized by cyber scammers.

Last Friday, the National Privacy Commission and the Cybercrime Investigation and Coordinating Center signed a memorandum of agreement for closer coordination in preventing the use of information and communication technology for criminal activities and other unauthorized purposes.

Such measures are critical if the new administration wants to push digital transformation for the country. Various sectors are calling for more measures to prevent the use of digital technology for a wide range of criminal activities, from child sexual exploitation to money laundering and the spread of fake news and disinformation. The busting of the online lending scam ring should be followed by sustained and intensified operations against other cyber criminals.