Wealth Manager - the site for professional investment managers

Register free for our breaking news email alerts with analysis and cutting edge commentary from our award winning team. Registration only takes a minute.

Wonga to pay £2.6 million compensation over 'unfair practices'

Wonga to pay £2.6 million compensation over 'unfair practices'

The UK’s biggest payday lender Wonga is to pay more than £2.6 million of compensation for using ‘unfair and misleading debt collection practices’.

The payouts, agreed in a deal with the Financial Conduct Authority (FCA), will see around 45,000 customers receive duress.

An investigation into the firm, which was started by the Office of Fair Trading (OFT) and taken on by the FCA, found the lender sent letters to customers in arrears from made up law firms, threatening legal action between October 2008 and November 2010. In some cases it even added admin fees to customers’ accounts to cover the cost of the letters.

Clive Adamson, director of supervision at the FCA, said: ‘Wonga’s 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.

‘The FCA expects firms to pay particular attention to fair treatment of those who have difficulty in meeting their loan repayments.’

The FCA said it had appointed a ‘skilled person’ to oversee the process and ensure all customers affected receive redress.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
1 Comment Play CEO Tapes: Buxton to Gilbert - ‘my Glencore quandary’

CEO Tapes: Buxton to Gilbert - ‘my Glencore quandary’

Do not miss the first two minutes of this film as Richard Buxton shares how he has been challenged by a client for owning shares in a certain company.

Play CEO Tapes: the huge opportunities for asset managers

CEO Tapes: the huge opportunities for asset managers

From tech disruption, retirement and poaching, the CEO discuss the opportunities for their businesses in this episode.

Play CEO Tapes: 'we're just a bunch of white dudes sitting here'

CEO Tapes: 'we're just a bunch of white dudes sitting here'

In our brand new series, eight CEOs discuss how the industry could do a better job for female fund managers.

Read More
Wealth Manager on Twitter