Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k custs

[Wombats]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

I know one thing - I think the Credit Unions are missing a massive opportunity at the moment while this is such high profile news.

[meellis]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

The thing is, even after all I have been through I know that credit is a necessary evil so I still believe we have to have it. Its the wider concerns that I would worry about. I'm 46 so I have to start admitting that I am getting nearer to the older generation than the younger. I have worked all my life and never claimed any benefits of any sort, I started a business and employed people and of course I needed funding to be able to achieve this. if I had succeeded then I would have been applauded for taking the risk and any of creditors would have taken more than a fair share of my success. Because I have ended up bankrupt I have been filed in the category of borrowing too much money that is how fickle it is.
Now my concerns, I keep hearing how there is a lot of people who would rather live on benefits than work for a living. There has been a report lately that has stated that white English kids are underperforming in school compared to ethnic minorities (not intended to be a racist statement). Like most parents mine worked hard to give me and my brother a better start in life and I would do the same for my kids if I had any. I am beginning to feel that there are generations that expect more from life because their parents have encouraged them to and tried to give them a good start, its all too easy for older generations to criticise because they started from nothing but in turn they have given their own offspring the best life they could before they flew the nest so nobody is going to go back to nothing when they leave home. These generations and later generations are now seeing later generations losing what they worked for so who would blame them if they start to believe it isn't worth the effort. Now, if they understand anything about this Wonga case they might even start to believe that clever expensive crime goes unpunished especially if you have money backing you. I am of the belief that a crime is a crime and if you get caught then you should shoulder the punishment.

[Wombats]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

I take your point entirely and agree with chunks of it. I am 'lucky' in that I've seen both sides. I've had money, lost it and narrowly avoided BK so far, lost my house etc... I live in a fantastic area, but one where the expectation is to go to school and then onto benefits for many families. Young women aged 17-19 commonly have 2 or 3 children, often by different fathers, substance abuse is rife and it's not that the people (usually men) won't work, they work cash in hand AND claim benefits so are quite well off.

I disagree about credit. We've lived without it for around 6 years now and don't buy anything if we haven't got the money. That said, we are often down to literally our last pound or two and there is a sense of guilt for our daughter, though we try to ensure she doesn't lose out because we're poor of course. Credit for you WAS essential. NOW it isn't, it's a time of adjustment which actually leaves you feeling quite good that (a) what you've got is yours and paid for and (b) you haven't really got anything of large financial worth as it's been taken. This makes you review what is important in life and it sure as hell is not money. Money is a necessary commodity to live, but as long as you can live money then takes a lower place in terms of importance.

I agree totally a crime is a crime, and further, given what I've said in this post, I believe more and more young people believe they can get away with crimes as they see others around them doing so in areas like this. To see criminality at higher levels going unpunished (and sometimes apparently rewarded) simply beggars belief.

[meellis]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

I am glad you are a bit more settled in life after all you have been through Wombats. I to am surviving without credit and adjusting my lifestyle but I do still realise it is a necessary evil. There is good credit and bad credit and it as much to do with the person asking for the credit as it is for the person/company supplying the credit. In the case of the person asking for the credit bad credit could be seen as borrowing at great expense to purchase something they don't really need say a new car when they already have one that is only a couple of years old. Good credit could be seen as getting a good rate on a loan to purchase a better more reliable car to make sure you get to work and replace the one that keeps breaking down. In the case of the supplier good credit is making sure it is affordable and supplied in an agreed and controlled manor so that the agreement is maintained fairly by both parties. Bad credit is taking advantage of the needy by making it easy for them to borrow at high cost, finding as many ways to add to the cost while the agreement is in force and just lending for pure profit with no consideration to the effects on the vulnerable.
One thing we all have to except is that there will have to be a certain amount of wastage and frivolous spending done. On the face of it all we really need is food ,drink, shelter, energy, sanitation and medical care. There is never going to be enough jobs in those sectors to keep everybody employed so we need all the other unnecessary items and people are sometimes going to have to borrow to buy them. People buying new cars keeps others employed in the factories, sometimes I feel we need to invent unnecessary jobs just to give work to some people and this might become more prevalent as we automate more jobs that people normally do. We are heading into a world where machines make stuff for us but nobody will be working and earning to be able to buy them so we will face a choice to pay people to stay at home or invent needless jobs so you are paying them to work.
What we need to remember about companies like Wonga is the reasons why they have done this. If it was purely to frighten people into paying then they could have just employed a proper legal company to do it for them. The truth is they could see that doing what they done will frighten the client into paying, generate extra revenue for themselves because they add charges and they don't have to pay out any of these charges to the companies that should have been doing it. It is win win to them and with there complete lack of morals it is just seen as good business.

[Amethyst]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

Citizens Advice Chief Executive Gillian Guy said:

“Fake legal letters hounding people in debt is callous intimidation. This latest revelation of payday lending practices is further evidence how out of control the industry has become. It is only fair the FCA makes Wonga compensate people who have been put under tremendous financial and emotional pressure because of these letters.

“Irresponsible payday lending has been a scourge on borrowers looking for a short-term loan to tide them over. People have been coming to Citizens Advice because payday lenders are harassing them, taking more money than they owe and chasing people for debts they didn’t take out. It is really important the FCA uses the powers it has to wipe out the horrendous practices used by many payday lenders.”

[Nibbler]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

MSE now looking at other companies apart from Wonga.

--> Is it just Wonga? Send us your debt demands from fake lawyers

[meellis]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

As per normal a list will come back to all the normal suspects and just highlight how they are all getting away with lots of things. If these companies are up to one thing you can guarantee they will be up to other things as well. Like other lists that have been compiled there will be your Barclays and Lloyds TSB who seem to go unpunished for pulling every particular trick in the book. I know they have been fined for individual transgressions but it is time the authorities looked at the amount of different schemes they are involved in and punished as a whole.

[Amethyst]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

hmmm, this is going to bring up all the companies like Blair Oliver Scott and Sechari Clark Mitchell and other inhouse debt collection letters. But MSE is a good place to get people sending you all the different DCA letters and I'm sure there will be a few that are simply invented, or that are overstating their powers or passing themselves off as solicitors.

[Wombats]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

Citizens Advice Chief Executive Gillian Guy said:

“Fake legal letters hounding people in debt is callous intimidation. This latest revelation of payday lending practices is further evidence how out of control the industry has become. It is only fair the FCA makes Wonga compensate people who have been put under tremendous financial and emotional pressure because of these letters.

Yes, well she's a fine one to talk about letters being callous intimidation and putting people under tremendous emotional pressure. I think Celestine will remember me receiving these from CAB with Gillian Guy's knowledge as far as one can see from the Subject Access Request.

The phrase, "We must protect our brand at all costs" is one which has stuck in my mind for a good few years now. Trading Standards actually offered to take action against CAB because of this. Why was I being sent a letter like that from CAB? Because I wanted to help people in debt in a fully licensed, legitimate, insured way. I went on to do so.

Forgive my cynicism but this permeates far deeper than some may imagine. Not many would imagine CAB writing letters like the one mentioned above (and that was just one of quite a few).

On the whole Gillian is very good though, and CAB do an excellent job in many areas.

[Guest]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

Yes unfortunately PDLs have been allowed to get a good foot hold,(at least the main contenders), many were pointing to what happened in other countries like Canada and America where the same thing happened seven or so years ago and in fact where these very same companies started their operation.

Some may say that the reason why they where allowed to flourish was because of the purposeful "blind eye" of the regulators and the government, in fact if you look at where some of the venture capital which funded the initial enterprises came from, you could be forgiven for thinking that the authorities were not only doing a Nelson here but in some ways complicit.

Now we are at a stage were we are seeing lip service, slap on the wrist measures, more designed to quiet the natives than impose any real sanctions, i suspect this will change as people get more disgruntled, it is just a shame that more people will have to suffer before any real action is taken.

[Wombats]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

At least in the USA PDL's are either banned or unfeasible in about a quarter of all states now due to regulation. Hopefully the UK will follow suit and the companies will be forced to move on again.

I agree entirely that the sanctions imposed on all these financial institutions are totally disproportionate to the offence. They make it sound a lot - "Gosh, 2.6 million, that'll hurt them!"

No. £2.6 million is just two weeks profit and that is only to give each customer a fiver. That's it! Put into context it is nothing.

[Guest]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

At least in the USA PDL's are either banned or unfeasible in about a quarter of all states now due to regulation. Hopefully the UK will follow suit and the companies will be forced to move on again.

.

Yes all the arguments that are being raised against these organisations are not new to them, the answers are well rehearsed they have heard all the questions before.

It was a kid in a candy store scenario, no effective regulation, country on the brink of recession, a third of the population in debt and struggling to meet short term commitments, no wonder the had no problem finding funding, a licence to print money.

[Wombats]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

Indeed - the thing is, it is possible to remove the kid from the candy store again though, certain states in the USA have proven this. The question is will we?

[Guest]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

With difficulty, but i think it will happen. As said they know the day will come when they can no longer operate the way they do.
They tried a number of measures to delay the inevitable, remember the failed sponsorship deals , where they tried to ingratiate themselves with the various community organisations, football clubs etc. All designed to delay the point when the public opinion turned against them to an extent that the regulators and government would have no option but to act, as said been there before, they were better prepared this time and it will be harder to get rid of them.

[Wombats]

Re: Wonga to pay redress for unfair debt collection practices – FCA - £2.6m to 45k cu

Perhaps a bit of this spirit is needed?

We shall defend our island, whatever the cost may be, we shall fight on the beaches, we shall fight on the landing grounds, we shall fight in the fields and in the streets, we shall fight in the hills; we shall never surrender.