17:39 06 February 2015
Wonga, the payday lender that was rapped for sending threatening fake letters to struggling borrowers, is to escape prosecution because “there is not sufficient evidence to progress a criminal investigation.”
Borrowers and commentators did not welcome the decision. Carl Packman, the author of Payday Lending: Global Growth of the High Cost Credit Market, said: “Today’s news is an insult. Wonga’s actions were tantamount to deception. Put simply, it is astounding that there will be no move to progress a criminal investigation.
“It is an insult to those who have been deceived by Wonga in the past. What will hurt the most is that Wonga’s actions will be deemed merely an example of bad practice.”
The investigation dated back to 2012 when the Office of Fair Trading met with the City of London Police to consider an OFT investigation into a specific case involving Wonga’s debt collection practices.
The Law Society chief executive Desmond Hudson said at the time: “It seems that the intention behind Wonga's dishonest activity was to make customers believe that their outstanding debt had been passed to a genuine law firm.
“It looks like they also wanted customers to believe that court action undertaken by a genuine law firm would follow if the debt was not repaid.
“Depending on the precise circumstances of what has happened, that could amount to blackmail and deception, as well as offences under the Solicitors Act 1974 and Legal Services Act 2007.”