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Thread: Wonga - fake debt firm letters

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    Wonga to pay 2.6m compensation for fake debt firm letters | Money | The Guardian

    Britain's best-known payday lender, Wonga, has been ordered to pay more than 2.6m compensation after it was found to have sent threatening letters to customers from non-existent law firms.

    The Financial Conduct Authority (FCA) said Wonga had been guilty of "unfair and misleading debt collection practices" after it emerged the lender had created fake law firms using the names of employees who in some cases still work for the company. The regulator said the firm would be compensating around 45,000 customers who received the letters, which threatened legal action over outstanding debts.

    However, the firm escaped a potential financial penalty or worse because the FCA only started policing payday lenders in April 2014, and these practices occurred while the now-defunct Office of Fair Trading (OFT) was in charge.

    Between October 2008 and November 2010, Wonga sent letters to customers in arrears under the names Chainey D'Amato & Shannon and Barker & Lowe Legal Recoveries leading customers to believe that their outstanding debt had been passed to a law firm or another third party. Legal action was threatened if the debt was not repaid.
    Wonga ordered to pay 2.6m compensation after using fake law firms to chase debts - Home News - UK - The Independent

    The payday lender Wonga is facing the prospect of a criminal investigation after City watchdogs handed police a file detailing how the company lied to hard-up borrowers.

    Wonga, famed for its 5,853 per cent APR and criticisms from the Church of England, was found by the Financial Conduct Authority to have sent threatening letters from two fictional law firms to customers in arrears. It even made some clients pay for sending them the fake letters.

    The Labour MP Stella Creasy, who has been campaigning against payday loan companies for years, demanded a full police inquiry after the regulator merely ordered Wonga to pay compensation of 2.6m to the 45,000 people who received the letters. A loophole meant it did not even receive a fine.

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    Default Re: Wonga - fake debt firm letters

    Better than a going over with a baseball bat.

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