The Crime of Wonga

The leopard cannot change its spots and pay day lenders follow a long tradition of usurious lenders who use two kinds of tactics to manipulate people. The first tactic is to pretend to be a jolly, friendly organisation that exists more to help people than to make a profit. Modern communications helps; Wonga manage to advertise on television showing puppets or cartoon characters that make you laugh; the idea is to show that there is no shame in borrowing from a payday lender charging interest at several thousand percent; it is often a witty smart move, the advertisements show us. The second tactic is to, having sucked the punters in, get the money and the profit back. Here the payday lenders use a number of tactics; there is the telephone call, carefully crafted to explain what will happen if you spend your money on food or rent rather than repaying the payday loan. Another tactic is to send threatening letters – much beloved of all creditors, whether payday lenders or not, sometimes from solicitors. However Wonga managed to reach new heights in the threatening letters department; they sent threatening letters from fictional solicitors firms. That saved Wonga the cost of employing solicitors to collect their debts and provided a cheap way of frightening their debtors. Often these letters from non-existent lawyers added a sum for legal fees to the claim.

The Financial Conduct Authority has fined Wonga £2.6 million for the false solicitors’ letters, a sum which Wonga will treat as simply an expense of running the business. The FCA said this was wrong and issued the fine; small beer to a business that charges thousands percent a year interest to the dupes it manages to suck in.

It is a criminal offence, and rightly so, for a person or an organisation to pretend to be a solicitor. However, I see no sign of Wonga or its directors being prosecuted for this offence which Wonga has admitted. Pretending to be a solicitor can cause as much damage as pretending to be a brain surgeon or a qualified physician.

I should not be surprised; small criminals who are caught feel the full rigour of the law; large organisations treat the law as something that they do not need to fear; they will not have all their assets confiscated neither will any Wonga director go to jail.

3 Responses

  1. The Wonga director is wong but he won’t be prosecuted.

    Wall Street, mortgage backed securities, bailing out banks and banksters that are too big to fail!

    Money talks and BS walks – is the old cliche.

  2. The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.

    Was/is he still right.

    Who will win?

  3. Wonga is nothing to what is coming.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: