Shaming your client-borrowers in public to force them to pay their debt is worse than usury.
This practice of three online lending companies did not go unnoticed after the National Privacy Commission found them guilty of publicly shaming their borrowers, and threatened them and their officers with an imprisonment of up to seven years and fines of not more than P5 million under the Data Privacy Act of 2012.
Commissioner Raymund Enriquez Liboro noted in the agency's investigation that the online lending companies had made it a business practice to specifically target the privacy of persons, “practically making a profit out of people’s fear of losing face and dignity.” Such unethical practices, he says, simply have no place in a civilized society and must stop.
Hundreds of individuals have trooped to the NPC to complain about the actions of the online lending companies, prompting the agency to launch an investigation.
The NPC in its fact-finding reports concluded that the three lending companies had not complied with the legal requirements for processing personal data and that they failed to adhere to the principles of transparency. The erring companies also committed unauthorized processing and malicious disclosure of the personal information of their clients.
The agency's report observed that the penalties inflicted on borrowers by the online lenders were abusive. “The public shaming they carried out has caused anxiety, depression; some have even lost jobs and feel they became unemployable, that their reputation and future was put in jeopardy. The permanence of these damages is disproportionate to the mere delinquency in paying debts, sometimes as low as one thousand pesos,” says Liboro.
The Data Privacy Act of 2012 is a legislative action in response to a global economy that is rapidly going digital. It holds companies accountable for the personal data given by their customers, and they should protect those information from third parties.
The three online lending companies clearly violated the privacy of their customers. They should be punished and meted out penalties for violating the basic right of their customers.