Glad SAFC is not connected with such a ****ty company Ashley and Wonga made for each other Payday lender Wonga has entered an agreement with the Financial Conduct Authority (FCA) which will see it pay compensation of more than £2.6 million to around 45,000 customers for unfair and misleading debt collection practices. In an investigation begun by the Office of Fair Trading (OFT) and taken forward by the FCA, Wonga was found to have sent letters to customers in arrears from non-existent law firms, threatening legal action. Between October 2008 and November 2010, Wonga and other companies within its group, used unfair debt collection practices which put customers under great pressure to make loan repayments that many could not afford, said the FCA. During this time, Wonga sent communications to customers in arrears under the names Chainey, DâAmato & Shannon and Barker and Lowe Legal Recoveries, which led customers to believe that their outstanding debt had been passed to a law firm, or other third party. Neither of those firms existed, which the FCA said showed Wonga was using this as a tactic to maximise collections by piling the pressure on customers. Further legal action was threatened if the debt was not repaid. The investigation found that in some cases Wonga also added charges to customers' accounts to cover the administration fees associated with sending letters. As part of a voluntary agreement with the regulator, Wonga must now identify and pay redress to all affected customers. The regulator has also appointed a skilled person to oversee the process and make sure customers get what they are owed. The process will start by mid-July with compensation likely to be paid from the end of July. It is thought that up to 45,000 customers could receive, between them, a total of over £2.6m in compensation. Clive Adamson (pictured), director of supervision at the FCA, said: âWongaâs misconduct was very serious because it had the effect of exacerbating an already difficult situation for customers in arrears. We are pleased that Wonga has been working with us to put matters right for its customers and to ensure that these historical practices are truly a thing of the past. âThe FCA expects firms to pay particular attention to fair treatment of those who have difficulty in meeting their loan repayments.â The practice was uncovered by the OFT, the former consumer credit regulator, in 2011 in response to formal notices requiring Wonga to disclose certain information about its debt collection practices. The FCA took over the investigation on 1 April 2014 when it became responsible for consumer credit. In April, Wonga also reported to the FCA that it had discovered system errors relating to the calculation of the amount owing on customer accounts where fees, balance adjustments or the timing used to calculate interest were not consistently applied. The FCA launched a thematic review into payday lenders in March to analyse how they collect debts and manage borrowers in arrears and forbearance.
Newcastle aside that industry is disgusting. Feel for anyone desperate or stupid enough to involve themselves in it.
I agree - and I always thought along the lines of "once you've done it, it's going to be a monthly occurrence" because of the way it works
They are in Europe! They limit the maximum intrest rateswhich can be charged so any body charging over that is breaking the law. Just a shame that this industry is allowed to be governed by UK law rather than European Law. Either that or we had a government with the balls to stand up to big money.
this current government will do **** all as they have Wonga venture capitalist (shareholders) donating to the Tory party
It's basically loan sharking ain't it? No credit check, so they no full well they are giving to people who can't pay, that person then has to borrow every month to cover the payment AND live, and it snowballs. It's a ****ing disgrace that the government allows this kind of thing in this country, it is preying on the weak and desperate. You know, if a company like Wonga capped loans at say £200, and you paid back say £240, they would still be incredibly profitable over time and would then be providing a genuinely reasonable service to people. They will start low, then offer folk £6-800 quid, the repayment then cleans them out (I'm assuming people who need this service will rarely earn great money), and they are then left with no option but to borrow it again, it's a rolling, permanent debt of £200 month or whatever just to have money to live on. It staggers me, £2.6 million is nowhere near enough, they should be forced to reduce all charges to a maximum of maybe 10%.
The 2.6 mill fine shows they can afford it, and on that basis it shows how much they are ripping people off. Legislation needs to be introduced to get robbing scum like this banned. The very people they target are the ones who cannot afford to repay, and only apply out of desperation. What a sad world we live in
Well lets hope they have to pay the fine back in 1 easy manageable repayment a month spread over the period until the sun explodes and at 3 billion percent interest!!!!!!!!!!!!!!!!!
I was so pleased to see this article this morning that I failed to spot that this is not a fine but a voluntary offer of redress from Wonga after they were caught with their pants down. The fact is that someone in a fairly senior position must have decided that it was OK to frighten 45,000 customers with bogus threatening letters. This demonstrates that the culture within the company is rotten to the core and gives a lie to their claim that they are providing a valuable social service. Let's hope the Archbishop of Canterbury's alternative along the lines of a friendly society succeeds and drives Wonga and the like out of business. TBF to this government it was they who brought pay day lenders within the orbit of the FCA which had the effect of frightening off a lot of the fly by night companies that were setting up at the thought of easy money.
Spot on - but the people running it are money people - and guess which political party the money people all vote for?
Venture Capitalist -Adrian Beecroft a major Tory donor ( donated to Tories well over 500,000 million pounds to date) has personal investments in WONGA.com -the same Adrian Beecroft was also commissioned by David Cameron to compile a report that recomended abolishing basic employment protection for the most vulnerable workers in society-Mike Ashley runs a shady business with zero hour contracts for his employees etc - has WONGA as a sponsor - go figure ! a corrupt bunch of ****s the lot of em !
its a real disgrace what these companies get away with. people get stuck in a circle of debt that they find it very hard to get out of off. lets face it these companies pray on the most vulnerable people in society and the government really need to step and either limit the interest rates or outlaw them all together.
There's not much chance of the archbishops alternative working; the day after he was condemning Wonga, he had to eat humble pie when it was revealed that the church of England is a major shareholder in Wonga!!
