LETTER TO A LAWYER

Dear Attorney,

I hope this letter finds you well. I am a concerned borrower who has recently experienced harassment from one of the online lending applications operating in the Philippines. The individuals behind the application appear to have accessed my contact list without my explicit consent and are now sending threatening or harassing messages, not only to me but also to the people in my contact list. Their actions are causing me a great deal of stress and embarrassment, and I would like to seek legal advice on the best steps to take moving forward. Any guidance you could provide—particularly regarding my rights and possible remedies under Philippine law—would be greatly appreciated.

Sincerely,
A Distressed Borrower

LEGAL ARTICLE: A COMPREHENSIVE GUIDE TO PHILIPPINE LAWS AND REMEDIES FOR HARASSMENT BY ONLINE LENDING APPLICATIONS

Introduction
In the digital age, many Filipinos rely on online lending applications to bridge financial gaps and meet their urgent monetary needs. While such platforms offer convenient and rapid loan processes, reports of abusive practices—especially harassment—are becoming increasingly common. Borrowers have reported that some online lenders engage in intrusive or threatening tactics to collect debts, including unauthorized access to personal data such as contact lists. This article aims to provide a thorough discussion of the legal framework in the Philippines that governs such activities, the rights of borrowers, and the remedies available to them under the law.

Regulatory Framework Governing Online Lending and Data Privacy

1.1. The Lending Company Regulation Act of 2007 (Republic Act No. 9474)
The Lending Company Regulation Act of 2007 provides the legal definition of lending companies and sets forth regulations on how they should conduct their business in the Philippines. Under this law, lending entities are required to secure the necessary permits and must comply with certain guidelines when engaging in the practice of providing loans. This legislation is relevant to all lending practices within the Philippines, including online-based and app-based lenders.

1.2. The Securities and Exchange Commission (SEC)
The Securities and Exchange Commission (SEC) is the regulatory body tasked with the supervision and regulation of lending firms. If an online lending company engages in any illegal debt collection practices, the SEC has the authority to investigate and impose administrative sanctions, suspend or revoke lending licenses, and refer the matter to other agencies if criminal liability arises.

1.3. The Data Privacy Act of 2012 (Republic Act No. 10173)
Central to most complaints about online lending apps is the illegal or unauthorized access and use of personal data, often in violation of the Data Privacy Act (DPA). The DPA mandates that personal information controllers (entities that collect and control personal data) and personal information processors (entities that process personal data) must process personal data in accordance with the principles of transparency, legitimate purpose, and proportionality. Collecting or using a borrower’s contact list without valid consent or for purposes beyond what was expressly agreed upon may constitute a violation of the DPA.

1.4. National Privacy Commission (NPC)
The NPC is the agency charged with implementing and enforcing the DPA. It can receive complaints, conduct investigations, and impose sanctions for data privacy violations. Borrowers who suspect their contact information or phone directories have been accessed or misused by an online lending application can file a complaint with the NPC. The Commission can penalize violators with fines, imprisonment, or both, depending on the gravity of the violation.
Nature of Harassment by Online Lending Applications

2.1. Unauthorized Access to Contacts
Several lending applications have a feature that requests permission to access a borrower’s phonebook upon installation. Although some borrowers may inadvertently grant this permission, the requirement to request permission does not necessarily shield the lender from liability, especially if the borrower did not knowingly or freely consent to such access. In many cases, the app’s terms and conditions are vague, misleading, or buried in fine print, raising questions about the legality of such “consent.”

2.2. Threatening and Defamatory Messages
Once the lending app has gained access to the borrower’s contacts, it may resort to sending mass messages that contain threats, defamatory statements, or both. These messages can be deeply unsettling and can cause reputational harm to the borrower. They may also involve false allegations of fraud or criminal behavior, accompanied by threats of legal action that are either unwarranted or exaggerated.

2.3. Harassment Tactics Against Third Parties
One of the more alarming trends is the harassment of individuals in the borrower’s contact list—often family, friends, or colleagues—who have nothing to do with the loan transaction. Sending unsolicited and harassing messages to innocent third parties may constitute a violation of their privacy rights and can attract legal consequences not just under data privacy laws but also under other civil and criminal provisions in Philippine law.
Relevant Philippine Laws and Legal Principles

3.1. Civil Law Provisions on Abuse of Rights
Philippine civil law principles, particularly those pertaining to the “abuse of rights” doctrine under the Civil Code, may come into play. If a lending app exercises its right to collect in a manner that is evidently abusive, malicious, and injurious to the rights of the borrower or to third parties, the borrower could bring a civil action for damages.

3.2. Criminal Law Provisions – Revised Penal Code
Depending on the content and severity of the harassing messages, criminal charges may be filed. For instance, if the messages contain slanderous or defamatory statements, the borrower might consider filing a case for libel or oral defamation under Articles 353 and 358 of the Revised Penal Code. If the messages contain threats of harm, the relevant provisions on grave threats or grave coercion may also be invoked.

3.3. Anti-Cybercrime Law (Republic Act No. 10175)
The Anti-Cybercrime Law penalizes libel and other crimes committed using electronic means. Online or electronic harassment, unauthorized processing of data, or other forms of cyberbullying could fall within the ambit of this law. Given that many interactions with online lending apps occur over digital channels, the Anti-Cybercrime Law could play a significant role in prosecuting these violations.

3.4. Data Privacy Act of 2012 (Revisited)
As mentioned, unauthorized access, collection, or disclosure of personal data can give rise to civil, administrative, and criminal penalties under the DPA. Sections 25 to 35 of the Act outline specific offenses, such as unauthorized processing, malicious disclosure, and unauthorized disclosure, each carrying respective penalties of fines and imprisonment.
Possible Remedies and Recourse

4.1. Filing a Complaint with the SEC
Borrowers who are harassed by lending companies that violate the Lending Company Regulation Act should first consider filing a complaint with the SEC. The complaint should detail the nature of the harassment, attach any evidence (screenshots, threatening messages, call logs), and specify the relief sought. The SEC can investigate and, if appropriate, impose sanctions on the erring lending company or refer the matter to other government offices if the conduct also constitutes a criminal offense.

4.2. Lodging a Complaint Before the National Privacy Commission
If the lending application has accessed or misused your personal data or your contacts without proper consent, a formal complaint can be filed with the NPC. Provide detailed information about how your data was collected, what permissions you granted (if any), and the specific ways the data was misused. The NPC has the power to investigate and issue orders or fines. In particularly egregious cases, it can even recommend criminal charges.

4.3. Civil Action for Damages
A lawsuit for damages may be filed if the borrower experiences emotional distress, reputational harm, or other injuries due to the lender’s abusive collection tactics. Civil law principles such as the abuse of rights, breach of contract, or tort liability may serve as legal grounds. Should the borrower prevail, the court may award nominal, moral, or even exemplary damages, depending on the severity of the harassment and the attendant circumstances.

4.4. Criminal Complaints
If the messages include slanderous or libelous statements, threats of harm, or other forms of intimidation, the borrower may pursue criminal complaints. Collecting compelling evidence is vital. This includes storing digital copies of text messages, audio recordings of phone calls if lawfully obtained, or social media posts. The barangay mediation process may be a preliminary step for less serious complaints, but for crimes such as libel, direct filing with the prosecutor’s office may be warranted.

4.5. Cease and Desist Orders / Preliminary Injunctions
In some cases, the borrower might seek provisional remedies, such as a cease and desist order or a preliminary injunction to stop an ongoing act of harassment or data misuse. While the granting of an injunction lies within the discretion of the court, it can offer immediate relief from persistent harassing conduct.
Practical Steps for Borrowers Facing Harassment

5.1. Gather Evidence
Always document every instance of harassment. This includes screenshots of messages, call logs, voice recordings (if permissible), and any correspondence that evidences the intrusive or threatening conduct. Eye-witness testimony from people who have received harassing messages can also bolster a complaint.

5.2. Revoke Permissions
If possible, borrowers should revoke any app permissions that grant access to their device’s contact list. This can be done in the phone’s settings. Removing the application entirely may also be an option, although it is crucial to weigh the potential ramifications on the loan agreement.

5.3. Seek Legal Counsel
Before taking any legal action, it is prudent to consult with an attorney who specializes in data privacy, cybersecurity, or consumer protection law. The attorney can assess the borrower’s situation, weigh the strength of potential claims, and guide the filing of complaints with the appropriate government agencies.

5.4. Report to the Authorities
Apart from the SEC and the NPC, borrowers may also approach law enforcement agencies like the Philippine National Police (PNP) or the National Bureau of Investigation (NBI) Cybercrime Division. They can provide guidance and investigate if the conduct qualifies as a cybercrime or if there is probable cause for other offenses.

5.5. Safeguard Mental and Emotional Well-Being
Harassment can take a serious toll on mental health. Individuals under extreme stress should consider seeking support from trusted family members or friends. Professional counseling services, mental health hotlines, or psychological support groups may also be beneficial, given the emotional strain caused by repeated threats or public shaming.
Role of Government Agencies and Ongoing Reforms

6.1. The SEC’s Role in Monitoring Lending Apps
In recent years, the SEC has been more vigilant in monitoring and regulating online lending applications. It regularly issues advisories and notices warning the public about unregistered lenders. The SEC has also been known to order the shutdown of lending apps that violate Philippine laws. These measures aim to protect consumers and deter unscrupulous operators from employing illegal or unethical debt collection methods.

6.2. NPC Investigations and Data Privacy Enforcement
The NPC has shown increasing resolve to penalize companies that fail to safeguard customer data or engage in unauthorized processing. It continues to work with other government entities to strengthen data privacy compliance across industries, including online lending. The NPC also promotes consumer awareness, urging Filipinos to be more cautious about granting app permissions.

6.3. Legislative Developments
There have been discussions among Philippine legislators regarding stronger consumer protection measures specifically geared toward digital lending. Proposed laws and regulations may impose stricter penalties for harassment and unauthorized data collection, along with clearer guidelines on permissible debt collection practices. While these bills and proposals are still in various stages of consideration, borrowers can look forward to more robust safeguards in the future.
Intersection with Credit Information and Consumer Protection

7.1. Credit Information System Act (CISA)
While the CISA encourages lenders to share credit data in a centralized database for creditworthiness assessments, it also emphasizes the confidentiality and accuracy of such information. Lending companies that unlawfully disclose or misuse borrower data, beyond what is permitted by CISA, may face penalties.

7.2. Consumer Act of the Philippines (Republic Act No. 7394)
Though focused primarily on consumer products and services, certain provisions of the Consumer Act underscore the state’s policy to protect consumer rights and interests. Harassing collection practices by lenders could be seen as an unfair and unconscionable act under principles of consumer protection law.
Defending Against Defamation and Protecting One’s Reputation

8.1. Understanding Defamation
Defamation in Philippine law includes libel (written or published form) and slander (spoken form). If an online lending application publicly accuses a borrower of “scamming” or “fraud” without evidence, it may be liable for defamation. The Anti-Cybercrime Law further clarifies the penalties for cyber libel, which can include imprisonment and fines.

8.2. Steps to File a Defamation Suit
A private complainant who wishes to file a criminal complaint for defamation must present substantial evidence of the defamatory statement, establish that it was indeed directed at them, and prove that it was made with malice. Screenshots, chat logs, or recorded calls can serve as key pieces of evidence.
Preventive Measures and Responsible Borrowing

9.1. Reading Terms and Conditions
Before installing any lending app, borrowers should scrutinize the terms and conditions, especially those pertaining to data collection. Understanding exactly what permissions you are granting can help you make informed decisions and potentially avoid problems related to unauthorized data access.

9.2. Maintaining Open Communication with Lenders
If repayment difficulties arise, initiating a conversation with the lender early may help prevent aggressive collection practices. A borrower may propose a payment plan, request an extension, or seek restructuring options. Many lenders are willing to accommodate borrowers who demonstrate sincerity in repaying their obligations.

9.3. Limiting Access Permissions
Even after installing an app, users can restrict certain permissions in their device settings. Minimizing the sharing of contact data or other personal information can reduce the risk of undue intrusion.
Conclusion

The increase in incidents of harassment and privacy violations by online lending applications in the Philippines underscores the need for strong legal protections and vigilant enforcement. The interplay of various laws—such as the Lending Company Regulation Act, the Data Privacy Act, the Revised Penal Code, and specialized cybercrime provisions—creates multiple layers of accountability for erring lenders. Moreover, the Securities and Exchange Commission and the National Privacy Commission have been active in investigating and penalizing unlawful or unethical practices, offering hope for borrowers who seek redress.

If you or someone you know has been subjected to harassment or privacy breaches by online lending companies, it is crucial to know your rights and the remedies available to you under Philippine law. Legal options may include filing complaints with the SEC and NPC, pursuing criminal charges under the Revised Penal Code or the Anti-Cybercrime Law, and instituting civil actions for damages. Throughout this process, gathering solid evidence, seeking proper legal counsel, and safeguarding your emotional well-being are paramount.

While these legal avenues exist, a measure of prevention remains the best defense. Borrowers are encouraged to exercise caution when granting permissions to mobile applications, read the fine print in loan agreements, and maintain open and honest communication with legitimate lenders. Government agencies continue to strengthen regulatory measures, aiming to protect consumers and ensure ethical lending practices in the evolving digital lending landscape.

By understanding the legal framework and taking proactive steps, Filipino borrowers can better guard themselves against harassment and maintain their dignity, privacy, and peace of mind. Ultimately, the Philippine legal system provides multiple pathways to hold abusive online lending platforms accountable, creating a safer environment for responsible borrowers and fostering a culture of fair lending practices throughout the country.

Disclaimer: This article is for informational purposes only and does not constitute legal advice. Individuals facing specific legal issues are encouraged to consult with a qualified attorney.