Ugmons

Ugmons (ブサモン, Busamon) are an unusual type of Mysterious Beings created from ugly humans.

Overview
Ugmons are formerly ugly humans, who have become monsters due to bullying, or from being turned down from the opposite sex. The feelings of jealousy or inferiority turn into hatred, covering their hearts with darkness dyed with evil. Their strength after turning into monsters is influenced by the hideousness of their hearts.

They seem to be common knowledge as the kids bullying Tareo mention their existence.