No matter how many puppets a company puts in the television advertisements that claim a company is about “straight-talking money,” it is almost impossible to convince regulators of a tendency to be straight about money if collecting on debts through letters from made-up law firms in part of the corporate playbook.
Such is the difficulty short-term loan company Wonga faces, following a ruling by the U.K.’s Financial Conduct Authority (FCA) that found the company unfair and misleading collection practices, reports TechCrunch.
Between the years of 2008 and 2010 Wonga sent letters from ‘Barker & Lowe’ and ‘Chainey, D’Amato and Shannon’ — two entities that are purely made up — to around 45,000 customers. The letter led people to believe their debts had been passed to a law firm, and then in a coup de grace fitting the whole sordid affair, charged customers an additional fee for the fake law firms made-up involvement.
Wonga voluntarily pulled the plug on the practice of sending fake legal firm letters, and information was provided to the OFT (Office of Fair Trading), Wonga’s regulator at the time, in January 2011.
The company is now facing a settlement payment of over $4 million (2.6 million pounds.)
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