Payday lender to stump up £34m of customer redress
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The Financial Conduct Authority (FCA) said these include taking payments without permission and sending “threatening and misleading” letters, texts and emails.
CFO Lending is to pay the sum, comprising £31.9m written-off outstanding balances and £2.9m in cash payments to customers, the majority of whom had payday loans but some had guarantor loans.
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Jonathan Davidson, director of supervision of retail and authorisations at the FCA, said: “We discovered that CFO lending was treating its customers unfairly and we made sure that they immediately stopped their unfair practices.”
These also included “routinely” reporting inaccurate information to credit reference agencies.
He added: “Since then we have worked closely with CFO Lending, and are now satisfied with their progress and the way that they have addressed their previous mistakes.
“Part of addressing these mistakes is making sure they put things right for their customers with a redress programme. CFO Lending customers do not need to take any action as the firm will contact all affected customers by March 2017.”
In February the FCA gave the firm, which also traded as Payday First, Flexible First, Money Resolve, Paycfo, Payday Advance and Payday Credit, limited permission to collect existing debts but not to make any new loans.