The Securities and Exchange Commission’s (SEC) Central Visayas office (SEC-Region 7) has warned the public against a growing advance fee loan scam in which fraudsters pose as agents of legitimate lending and financing companies.
Dion Drew Diano, SEC-Region 7 regional information officer II, said scammers operate through social media, messaging apps such as Telegram, and fake websites, posing as representatives of registered lenders.
Scammers ask victims to pay advance processing, security, or credit adjustment fees before releasing a promised loan, he said.
SEC said no legitimate lending or financing company requires payment before releasing loan proceeds, and that such advance fees are not tied to a borrower’s capacity to pay.
The commission urged the public not to respond to or transact with any lender demanding payment upfront.
SEC also cautioned against letting others use one’s bank or e-wallet account, warning that such accounts can be exploited for pyramid schemes, money laundering, or other fraud — and that account owners can be held liable under the law.
Advance fee loan scams violate Article 315 on swindling, or estafa, under the Revised Penal Code, the SEC said.
Those who allow their accounts to be used as conduits for the scheme, or so-called money mules, face up to 14 years in prison, a fine of up to P5 million pesos, or both, according to the agency.
The commission has issued similar advisories on advance fee scams on Nov. 29, 2022, and Oct. 18, 2023, with the latest issued this month.
Diano urged victims to report such scams immediately to the Philippine National Police and the National Bureau of Investigation. SEC Central Visayas said it remains committed to protecting the public from advance fee loan scams and will continue coordinating with law enforcement to curb the activity.
Advance fee loan scams have proliferated across the Philippines in recent years, tracking the rapid growth of online lending platforms and social media-based financial marketing.
SEC and the Bangko Sentral ng Pilipinas have repeatedly flagged unregistered lending apps and Facebook or Telegram-based “lenders” that harvest personal data and processing fees from cash-strapped borrowers, particularly during economic strain from inflation and stagnant wages.
The Anti-Financial Account Scamming Act, signed into law in 2024, expanded penalties for the recruitment and use of “money mules” — individuals who lend or sell their bank and e-wallet accounts to scam syndicates — reflecting a crackdown on account-based fraud schemes that regulators say have grown alongside the country’s digital payments boom.