HI-FIN LENDING INC.

Commission Exchange Securities and AXOMDIEIDNA FINANCING AND LENDING COMPANIES DIVISION IN THE MATTER OF: FinLend Order No. 2025 -_15 Authority No.3027) HI-FIN LENDING INC. (SEC Reg. No. CS201910995 and Certificate of Respondent. FOR: FAILURE TO COMPLY WITH ORDER DATED 08 JUNE 2023 OR THE SERVICE PROVIDERS IN COMPLIANCE WITH FINANCIAL PRODUCTS AND SUBMISSION SERVICES CONSUMER PROTECTION OF THIRD-PARTY ACT OF 2022 AND ITS IMPLEMENTING RULES AND REGULATIONS ORDER Circular No. 05, Series of 2023 ("MC 05"). Lending Companies Department ("FinLenD") against Hi-Fin Lending Inc.("HLI"),for alleged noncompliance with the Order Dated 08 June 2023 ("Order dated 08 June 2023") on the Submission of Third-Party Service Providers in accordance with the Financial Products and Services Consumer Protection Act of 2022 ("FCPA") and its Implementing Rules and Regulations ("IRR"), as implemented by SEC Memorandum This resolves the Show Cause Letter ("SCL") dated 14 February issued by the Financing and FACTS: Pio Del Pilar, Makati City. Its primary purpose is: Company. HLI's registered principal place of business is at 7/F King's Court Bldg. 1, 2129 Chino Roces Ave., ("LCRA") on 24 July 2019. It was issued a Certificate of Authority No.3027 to Operate as a Lending HLI is a duly registered lending company under the Lending Company Regulation Act of 2007 that the corporation shall not solicit, accept, or take investments/placements from the public neither shall it issue investment contracts."i "To engage in lending under Lending Regulation Act of 2007, as amended, provided following provisions, to wit: their authorized third-party services providers ("TPSPs") engaged to perform debt collection, marketing debt collection and/or marketing. Furthermore, the Order dated 08 June 2023 expressly provides the and/or customer transactions, specifically, the contact details of, and such other details associated with the TPSP,which shall include the names and registered mobile phone numbers of agents engaged to perform On 08 June 2023, the Commission ordered all financing and lending companies to submit a list of information/documents shall be deemed non-compliance of this Order. "Submission of false, inaccurate, misleading and/or incomplete its IRR, existing SEC Memorandum Circulars, and other relevant regulations. Such authority to operate as a financing or lending company." Non-compliance with this Order shall be penalized in accordance with the FCPA and penalties shall include, but is not limited to, suspension and/or revocation of authorized collection agents, to wit On 11 July 2024, HLI submitted its list of TPSP and enumerated the following companies Article II, Articles of Incorporation approved on24July 2019. Scan the QR to verify the document dated 08 June 2023. Hi-Fin Lending Inc. For: Failure to comply with Order Page 2 of 5 Name of Third-Party Service Provider COMPANY (TPSP) Address of the TPSP 2ClBI Information. Inc. 18X8 Philippines. Inc 3QuantumKey Services & Solutions Inc Unit 1101 11th Floor World Plaza 5th Avenue e-square Information Technology Park PHASE I VISAYAS AVENUE, FREEPORT AREA OF BATAAN. MARIVES BATAAN 2F Salustiana D.Ty Tower Pays0Inc Unit 1207.The Finance Centre,26th Street cor.9th Ave..BGC,Taguig.Metro panilacShiippin discovered that WeWill also serves as a collection agent of HLI. Crime Commission conducted a raid on the premises of WeWill Tech Corp. ("WeWill") for its alleged involvement in the harassment of customers of Online Lending Platforms. During the raid, it was On 31 January 2025, the National Bureau of Investigation and the Presidential Anti-Organized cause why it is not administratively liable for the non-inclusion of WeWill in its list of TPSP. On 14 February 2025, FinLenD issued a Show Cause Letter against HLI and directed HLI to show exclude WeWill from its TPSP list,to wit On 20 February 2025, HLI submitted its response and contended that it had not intended to the third-party service provider at the time of the filing. "We would like to clarify that there was no intention to exclude WeWill from the TPSP list. The list submitted on July 11, 2024 was accurate and fully compliant with regulatory disclosure requirements. The obligation to disclose TPSPs assumes a contractual relationship with rights and obligations established between Hi-Fin and as a collection agent in August 15, 2024. authority to conduct business as of July 11, 2024 and only commenced operations with a copy attached as Annex "B." This confirms that WeWill did not have the Furthermore, WeWill's business permit was officially registered on July 31, 2024 Given the absence of a contractual relationship between Hi-Fin and WeWill as of July misleading information in previous disclosures. The Company remains committed to full compliance with SEC regulations. 11,2024,we respectfully assert that Hi-Fin did not provide any false,inaccurate,or ISSUE: by the Order dated 08June2023. Whether HLI is administratively liable for its failure to report WeWill as one of its TPSPs as required HELD: FinLenD finds HLI administratively liable for failing to comply with the Order dated 08 June 2023. Submission of a TPsp List ensures that the companies, but also with their TPSPs. only with the financing and lending Commission has supervisory authority not authorized TPSP. This Order was issued to complement Section 4 of MC 05, which ensures that financ The Order dated 08 June 2023 requires financing and lending companies to submit their list Scan the QR to verify the document For: Failure to comply with Order dated 08 June 2023. Hi-Fin Lending Inc. Page 3 of 5 consumers are treated fairly, honestly, and professionally not only by the financial service provider, but also by its TPSP and lending companies and their TPSPs deal with their customers, to wit: Section 4 of MC 05 also lays down the general policy, and minimum standards on how financing "Section 4. Fair and Respectful Treatment of Clients. Section 4.1. Fair and Respectful Treatment of Clients. -- xxx procedures, control functions and agreements with third-party service providers. This Rule ensures that financial consumers are treated fairly, honestly, and acceptable selling practices,fair and equitable terms and conditions, provision of consumers, among others, and shall incorporate the same in their policies and professionally at all stages of their relationship with financial service providers. Financial service providers shall adopt mechanisms to safeguard the interests of their financial consumers which shall include rules regarding ethical staff behavior products and services appropriate to the capacity and risk appetite of financial Section 4.2. A financial service provider demonstrates the principle of fair treatment toward financial consumers if its policies and practices observe the following: A. xxxX B. The financial service provider does not employ abusive collection or debt recovery all reasonable and legally permissible means to collect amounts due them. However in unscrupulous or untoward acts. in doing so, they observe good faith and reasonable conduct and refrain from engaging practices against its financial consumers. The financial service provider or its collection agencies, counsels and other authorized third-party agents may resort tc Section 4.3. The staff of a financial service provider and its authorized third-party representatives shall treat financial consumers with professional competence and in a manner that is fair and reasonable. The financial service provider shall: A. Establish a code of conduct applicable to all its staff and authorized third-party representatives, setting forth the organizational values and standards of professional the board of directors. The board shall define the financial service provider's conduct that uphold the protection of financial consumers appropriate to its structure,operations,and risk profile.The code should be reviewed and approved by to an appropriate body; and shall institutionalize a system that will allow reporting of concerns or violations corporate culture and values.It shall establish a code of conduct and ethical standards B. Align its recruitment and training policies with professional,fair,and responsible treatment of financial consumers. in compliance with the Consumer Protection Standards of Conduct. The following demonstrate the financial service provider's adherence to fair and responsible treatment of financial consumers: sell to ensure understanding of their key features, risks, terms and costs, and relevont i. The financial service provider's staff and third-party representatives receive adequate training suitable for the complexity of the financial products or services they Scan the QR to verify the document Hi-Fin Lending Inc. For: Failure to comply with Order dated 08 June 2023. Page 4 of 5 Consumer Protection Standards of Conduct, including statutory and regulatory requirements and related internal policies and procedures that might impact their consumers,including those pertaining to consumer risks arising from cybersecurity and/or digital financial products and services; ii. The financial service provider's staff. as well as authorized third-party sign contracts or rush into a financial deal without the benefit of shopping around; representatives contracted for sales and marketing purposes, do not use deceptive or high-pressure/aggressive sales techniques and do not force financial consumers to relevant regulations iii. The financial service provider's staff involved in collections, as well as authorized debt collection practices and loan recovery procedures consistent with existing third-party representatives contracted for the purpose,receive training in acceptable iv. XXx; C.xxx collection or debt recovery practices against their financial consumers." [emphasis Section 4.4. Prohibition on Employment of Abusive Collection or Debt Recovery Practices. -- Financial service providers and their collection agencies, counsels and other authorized third-party representatives are prohibited from employing abusive supplied] financing and lending company, but also on the TPSP. Needless to state, the obligation to treat clients fairly and respectfully is imposed not only on the Submission of false, inaccurate, misleading and/or incomplete information/documents shall be deemed non-compliance and may be punishable by suspension or revocation. state and disclose their TPSP before the Commission as mandated under the Order dated 08 June 2023 To attain the obiective set forth under MC 05,all financing and lending companies must truthfully FinLenD finds HLI's submission to be the penalty of revocation. inaccurate and false.ThusFinLenD imposes no contractual relationship between them as of 11 July 2024. submitted did not include WeWill because WeWill was only incorporated on 31 July 2024, and there was In this case, FinLenD's records show that HLI submitted its TPSP list on 11 July 2024. The list HLI July 2024, HLI has an obligation to promptly update its previously submitted TPSP list. Failing to do so shall While it may be true that there was no contractual relationship between WeWill and HLI as of 11 result in noncompliance with the Order dated 08 June 2023 because its TPSP list under FinLenD's records is inaccurate and false, considering that it had already contracted another TPSp, WeWill. HLI's failure to update and include WeWill among its TPSPs. Thus,FinLenD finds the 11 July 2024 TPSP submission of HLI to be inaccurate and false because of Hi-Fin Lending Inc. are hereby REVOKED. CS201910995 AND Certificate of Authority to Operate as a Lending Company (CA No. 3027) including its Authority to Operate its Online Lending Platforms (e.g., Peso Wallet and Credit Cash)of WHEREFORE, in view of the foregoing, the Certificate of Incorporation (SEC REG No. Scan the QR to verify the document Hi-Fin Lending Inc. For: Failure to comply with Order dated 08 June 2023. Page 5 of 5 This Order shall be immediately executory. the Information Communications and Technology Department for their information and appropriate action. Let a copy of this Order be furnished to the Company Registration and Monitoring Department and l May NL5 znVovyey uM ATTY. KENNETH JOY A. QUIMIO #C gid{Director CC Cuma Scan the QR to verify the document