Payday lender CFO Lending will redress £34m to more than £97,000 customers for a range of unfair practices after reaching an agreement with the Financial Conduct Authority.
CFO Lending’s misdemeanours included showing incorrect loan balances on its system so some customers paid more money than they owed, taking payments from customers without permission, failing to give due forbearance to customers in financial difficulties and sending threatening and misleading letters, texts and emails to customers.
Of the £34m redressed £31.9m will be written-off customers’ outstanding balances and £2.9m will be paid in cash.
CFO Lending traded as Payday First, Flexible First, Money Resolve, Paycfo, Payday Advance and Payday Credit.
Jonathan Davidson, director of supervision, retail and authorisations, at the Financial Conduct Authority, said: “We discovered that CFO lending was treating its customers unfairly and we made sure that they immediately stopped their unfair practices. 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.”
CFO Lending stopped contacting customers with outstanding debts in August 2014 following an investigation by the FCA.
In February 2016 the regulator authorised the firm with limited permission to collect its existing debts but not to make any new loans.