Wonga
Wonga.com is a UK-based online money lending company that charges customers an eye-watering 4214 per cent for short term payday loans. It describes itself as a "digital finance company" and as "one of the world's most innovative credit providers".
Contents
Background
Wonga launched its first website in 2007. It was "recently named the number one company in the Sunday Times Tech Track 100, which lists the UK's fastest growing technology companies, alongside a host of other award-wins for our fresh approach to finance. We are shaking up the old world of high street banks and traditional lenders with a range of simple, transparent and flexible services which are currently available in the UK and South Africa". [1]
The company's latest accounts in May 2012 revealed its worth has grown to a 'staggering' £384 million; up from a mere £17m in December 2010. According to The Mirror, Wonga's co-founders Errol Damelin and Jonty Hurwitz have pocketed around £50 million between them. [2]
Controversies and criticism
Wonga.com accused by trading watchdog of misdeeds
On 21 May 2012 the UK’s Office of Fair Trading said that Wonga.com had been lying to its customers and even accusing some of them of fraud. It said Wonga "had sent letters and emails to some customers who had reversed payments to it alleging possible fraud and threatening to call the police. Customers in the public or financial sectors were also falsely told that being in debt was against their employment terms". The payday lender is appealing the decision. [3]
In September 2012, it also emerged that Wonga had billed some customers for loans they had not taken out. The company defended its fraud-checking procedures, saying such cases were "extremely rare", however the Guardian reported one major bank as saying it had seen a "significant increase" this year in cases of criminals applying for loans from Wonga using stolen account details. The company insisted it has "a zero tolerance policy on fraud", and that cases of criminals targeting it were "extremely rare".[4]
Revolving door
In October 2012 David Cameron's adviser on digital strategy, Jonathan Luff, quit his Downing Street role to become a lobbyist for Wonga. Luff was given clearance to begin work immediately for the company, raising fresh concerns about the 'revolving door' between government and big business.[5]
People
- Errol Damelin - co-founder
- Jonty Hurwitz - co-founder
- Jonathan Luff - Global Head of Public Affairs from November 2012
Lobbying firms
The register of the Association of Professional Political Consultants shows that Wonga.com retained Heathcroft Communications in 2010 and 2011. [6]
Affiliations
- Adrian Beecroft, chairman of venture capitalist Dawn Capital, which owns a chunk of Wonga.com, is an adviser to David Cameron and a Tory donor. See his Powerbase profile for more information.
- Newcastle United - in October 2012 the cash-strapped football club agreed a controversial £24million four year sponsorship deal with Wonga
Contact
- Website: https://www.wonga.com/
External resources
- Jill Treanor, 10 things every Newcastle United fan should know about Wonga, The Guardian, 9 October 2012 </ref>
Notes
- ↑ About Wonga, Wonga website, undated, acc 12 November 2012
- ↑ Wonga: The men who made £50million from other people's cash woes, The Mirror, 13 May 2012, acc 12 November 2012
- ↑ Russell Lynch, Watchdog accuses payday lender Wonga of lying, Evening Standard, 22 May 2012, acc May 2012
- ↑ Wonga trebles earnings as income rises 225%, The Guardian, Sunday 16 September 2012 11.02 BST
- ↑ Adam Sherwin, 'David Cameron adviser Jonathan Luff quits to join payday lender Wonga as lobbyist', The Independent, 31 October 2012.
- ↑ APPC Register Entry for 1 March 2011 to 31 May 2011
