I heard last week that the “pay-day” loan company Wonga sent fake lawyer letters to its customers to intimidate them into repaying their outstanding debts. The financial watchdog the “Financial Conduct Authority” has ordered Wonga to compensate their customers, but it is not clear whether anyone will face criminal prosecution.
Surely doing this is illegal, as it amounts to fraudulent representation. I’m no legal expert, but my understanding of fraud is to make false representations with the aim of perfunctory gain. Wonga were pretending the letters were coming from lawyer firms precisely to gain financially (re-coup their outstanding loans), and so I don’t see why the people responsible for this should not face criminal prosecution.
Pay-day loans are something which have sadly become quite common in the last half a dozen years. Anyone who has watched afternoon TV (which I have ended up doing when ill last year when I got back from India) will have seen their advertisements. Out of curiosity, I have gone to the Wonga website to see how much interest I would pay if I borrowed £400 (the maximum one can borrow as a first time customer) for 35 days (5 weeks). The interest is an unbelievable £147.43, which translates to an annual interest rate of something ridiculous of nearly 6000%!!!!!
The quote from Wonga’s UK Managing Director Tessa Cook in my screen capture above is, to say the least, less than sufficient. Not only should Wonga not be proud of making up fake lawyer letters, but the people involved should face prosecution.