Payday loan companies......
Scumbags who are no better than backstreet loan sharks praying on the desperate and gullible.
A payday loans company and its director have fallen foul of the law by failing to register with data-protection officials at the Information Commissioner’s Office. The sole director of First Financial, Hamed Shabani, was convicted under section 61 of the Data Protection Act (DPA) at the City of London Magistrates' Court on 9 …
As far as I am concerned, the only difference between Wonga and the aforementioned sharks, is that the loan sharks don't have incredibly annoying adverts spammed all over my television at every opportunity, and their APR is probably considerably lower. I can envisage no circumstance where an APR of well into four figures is justifiable (IIRC, Wonga's is around 5000%)
I'm no fan of Wonga etc, and I use them as case studies for business ethics (would it be ethical to start a fairer payday loan company? Would it be ethical to invest? Would it be ethical to not invest if you are a money manager and the company is returning better than market rates?) but APR on short term loans is a bad comparison.
As in, you can only have a short term loan rolled over into another three times, and you can only get charged your massive interest for 60 days. If you still owe then, you get put onto a more normal 6 month loan, at rates close to "acceptable". About the same as credit card or car loan rates. If you compared the effective APR on going into overdraft with your bank by a penny, you'd get an APR in the millions of percent. Of course, no bank would ever charge a fiver a day for an overdraft of less than a hundred quid now?
So the payday lenders are scum. At least they're not actual loan sharks (with actual 5000% APR compunding) just predatory lenders. Like pawnbrokers, check cashers, pre-pay meters, hire purchase etc they are the mechanisms of how the poor pay more, it's crap, but it's how the market responds to bad credit.
Borrow £100 over the weekend, payback £110 = OMG 2000% interest
Go overdrawn £10 at the bank, pay £120 unauthorized overdraft fee and £25 for the letter telling you.
But you only paid 15% interest !
No wonder the responsible high street banks and their pet politicians want these people outlawed
In an honest society politicians would have looked at this and said no, they would have banned payday loan sharks.
I wonder how many of our Politicos sit on the boards of these businesses, as we have seen before they tend to have their snouts in the trough where money is being made.
No right minded individual would allow it.... Brown envelope sir.
"Scumbags who are no better than backstreet loan sharks praying on the desperate and gullible."
alternatively they are business people who are operating due to a total refusal by government and banking to offer services to people that need them.
I don't like them myself, but there are few morals in business and its rather boring for people to continually expect firms to have any without being required to do so.
I run a small business and try to do the right thing by people. It's not hard. This guy is preying on the weak and the fact he has a corporate structure to do so doesn't absolve him. Yes, it's also a legislative failure that he's allowed to do so at all, but two wrongs etc.
That "providing a service no one else would" bit is a line straight out of the Sopranos.
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So when someone knocks on your Granny's door and says there is a single lose slate on the roof, fixes it and charges £3000, do you think:
A: it's morally repugnant and criminal behaviour to pray on the vulnerable in society which should be punished by law.
or
B: Serves the senile old crone right and she should be pushing up the daisies ?
If you think B: then please wear a bright fluorescent sign saying "selfish git" so I don't have to cross the street to piss on you when you are on fire. Instead I'll grab my toasting fork. Thank feck I don't have you as a neighbour, mine are decent.
PS this happened to my Gran and luckily the perpetrators were caught and sentenced.
Edit - Thanks To Jamie Jones for pointing out A & B mix up
" Edit - Thanks To Jamie Jones for pointing out A & B mix up"
No problem! - I would have included the smiley face icon, but can't add icons from my phone!
Somewhat related, I was waiting for the last bus last night, and someone had fallen asleep on one of the chairs associated with this particular bus bay.
When the bus came, not one of the 20-odd other people attempted to wake her - many walking right past her in the queue to get on. So I went back and did so, for which she was grateful.
Is this what the country is coming too? Girl on her own, last bus, 8 mile journey....
"Shabani was fined £150, ordered to pay £1,010.66 towards the cost of the prosecution and a £20 victim surcharge. First Financial was convicted under section 17 and fined £500, ordered to pay £1,010.66 costs and a £50 victims’ surcharge."
The interest on a loan to just one victimcustomer will probably cover that.
Seize all the assets of the company. Ban the owner from being a Director or executive of any other business.
Remember this isn't about a data loss/breach, this is about understanding the most basic responsibilities regarding data protection and registering the company as data controller.
Sorry but if you don't know the the first thing about the legalities of running a business, then you shouldn't be allowed to. Ignorance is no excuse.
Not quite true, the surcharge doesn't go to a victim in that particular case it goes into a fund which compensates victims of crime.
For instance it pays compensation if someone attacks you in the street. There might be a criminal prosecution against the perpetrator but that would not result in a monetary award for the victim. For that you would need to mount a second civil case but you might often find that any award is a small amount per week due to no assets of the victim.
The compensation fund will pay out a set amount based upon a compensation chart.
I found this report interesting:
http://www.bitterwallet.com/pay-day-loans-cowboys-spam-a-lot-thanks-to-oft/62702
If this guy was supplying credit without DPA registration, doesn't that mean he was operating illegally? Should that not be a matter for the OFT?
If anyone did actually take out a loan with this company, it should be declared void and any monies paid to First Financial Returned.
Why did they use a Magistrates Court when a higher court might be better acquainted with more effective punishment?