View the article online at http://citywire.co.uk/money/article/a871820
Payday lender collapses after agreeing £20m redress deal
Cash Genie formally enters liquidation as it looks to pay back £20 million to customers
Payday lender Cash Genie has entered liquidation after agreeing a £20 million redress package to more than 92,000 customers for unfair practices.
Cash Genie handed over to liquidator RSM Restructuring Advisory LLP earlier this week but the Financial Conduct Authority (FCA) said it would not affect the payment of redress to customers.
In July 2015 Cash Genie and the FCA reached an agreement for the payday lender to pay back over £20 million to customers affected by unfair practices spanning the last six years.
According to the regulator, the failings included unfair fees, including payments to transfer customers to its sister debt collection firm despite no additional costs being incurred. Cash Genie applied further fees or interest to accounts owned by customers who had not repaid their loans after 12 months, even though they had not been sent an annual statement of their charges.
The FCA said Cash Genie had completed its attempts to contact all customers due redress and customers should continue to make payments if they still owe the payday lender money unless they are told to stop.
The regulator added that affected customers do not need to apply for redress through a claims management company because doing so could ‘involve the payment of a significant fee relative to the amount of any redress received.’
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