Employment agencies and money-lending companies in the Philippines are cheating women applying for jobs abroad out of thousands of pounds by charging illegal fees paid with high-interest loans, interviews and documents show.
Interviews with hundreds of women and thousands of pages of complaints compiled by a migrant rights organisation showed job agencies charged applicants training and medical fees that are above the legally allowed limit.
Recruiters take applicants, usually women searching for domestic work, to financial firms they have links with to take out loans to pay the fees, which come with interest rates often exceeding 130%, according to the documented complaints.
Under Philippine law, lenders are not allowed to charge overseas workers more than 8% annual interest. Recruitment agencies are prohibited from charging placement fees for overseas jobs, but migrant workers can be charged for training and medical examinations. The amount they can charge is capped at 5,000 pesos (£71).
Some workers who applied for jobs in Hong Kong and Taiwan told the migrant rights organisation Migrasia and the International Consortium of Investigative Journalists (ICIJ) that they and their families had been subjected to threats and harassment by the lenders when they could not meet the repayments.
About 18% of the Philippines population, or 20 million people, live below the poverty line of 12,030 pesos a month for a family of five, prompting millions of Filipinos to leave the country each year in search of jobs and higher wages. Overseas remittances totalled $36.1bn (£28.30bn) last year.
Merry Criz Renayong, a 35-year-old single mother of two, said she was told by the recruitment agency Rapid Manpower Consultants that she needed to pay $1,200 in medical and training fees when she applied for a job in Hong Kong in 2019.
When she said she could not afford to pay the fees, she said she was taken to the nearby offices of Hoya Lending Investor Corporation, where she signed a loan agreement. But she said: “I was not allowed to take a photo of the contract.”
After she had signed, she said she was told the interest rate would be 4%, but after she had started her new job she learned she would need to pay back $365.41 a month – more than 60% of her monthly wage, which amounted to an annual interest rate of more than 188%. The Hong Kong-based Migrasia said it had documents showing Hoya charged an average interest rate of 143% on its loans.
Once she had agreed to the loan, Renayong said Hoya staff led her to a bank in its building to set up an account. She said she had to sign a blank cheque and was told it would be cashed in for the whole amount she owed if she missed a repayment. Under Philippine law, bouncing a cheque is a crime that can carry a prison sentence.
Renayong said she felt forced to take out the loan and was doing what Hoya and Rapid were telling her to do.
After three months, Renayong was fired from her job. She could not afford the fees to get another one in Hong Kong and had no way of keeping up her payments to Hoya. The company started sending her threatening messages, she said.
Renayong found another job in Qatar, but she said: “I’m so afraid of that blank cheque, because maybe one day they [would] arrest me because of that. I’m so afraid I might go to jail.”
When Annabelle Gutierrez, 38, applied for a job in Hong Kong through A&W International Manpower Services, she was informed she needed to take out a loan with Prosperity & Success Lending Investor Corporation to cover more than $900 in medical and training fees.
She said the agency tried to stop her from looking elsewhere for a loan by holding on to her identification papers, including her passport.
“I was telling them I wanted to take the loan from another lending company, but they held my documents until it was time for me to fly,” she said. “They forwarded my documents to the lending company, and the loan was ready before my flight.” The loan had an annual interest rate of 136%.
Her work contract was terminated by her employer after 14 days and she is now struggling to repay the loan. She said the recruitment and loan companies were sending her threatening messages on social media.
“We want to work abroad, so they charge workers huge amounts of money,” says Gutierrez. “We grab it because we don’t have a choice.”
Adrelyn Padernal, 34, said she took out a $1,615 loan from Hoya to cover job-placement fees for a domestic worker’s position in Taiwan in 2019. She paid $2,872 in interest over one year out of her annual salary of about $6,600.
Padernal, a mother of four, managed to repay the full loan, but she said she was still angry about the amount she was charged. “I had no choice,” she said.
“I’m angry. I work very hard here,” Padernal added. “It was so much to pay. It was very difficult because I needed to pay the loan company before sending money to my family.”
Migrasia filed complaints about the women’s treatment with 10 Philippine government departments, including the Securities and Exchange Commission (SEC) and the Presidential Anti-Corruption Commission, in 2020 and 2021. The complaints named 12 licensed loan firms operating in the Philippines.
Migrasia said the authorities had failed to act yet. “We believe these fees and schemes are a huge problem that affect hundreds of thousands of women each year,” said a spokesperson.
“While it seemed like there was mild improvement leading up to Covid, over the past four years there has been a general increase in the size and likelihood of these debts occurring.
“Most of these workers are just trying to establish a better life for their families,” Migrasia said.
Hoya Lending and Prosperity & Success declined to comment. Rapid Manpower and A&W did not respond to repeated requests for comment and neither did the Philippine SEC. The Department of Migrant Workers said it would provide a comment, but none has been received.
“These schemes are despicable and exploitative of desperately poor people trying to make a better life for themselves,” says Ira Rheingold, a Washington DC-based lawyer and expert on predatory lending.
“All the actors involved – from the employment agencies to the lenders to the Philippine government – need to be held accountable for their actions, or blind inaction, that have allowed these schemes to thrive,” he said.
• This article is part of a series on human trafficking and labour abuses called Trafficking Inc. Media partners include the ICIJ, Reuters and NBC News
