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Wonga’s profits expected to show 40% nose dive

26/09/2014

Wonga's 2013 results are expected to show a 40 per cent fall in pre-tax profits from £84.5m to £50m, a report from Sky News has claimed.

In June, the payday lender got into trouble with the Financial Conduct Authority (FCA) after sending letters to customers in arrears from fake law firms threatening legal action. In some cases the lender added adminstration costs to customers’ accounts for generating the letters.

The regulator ordered Wonga to pay more than £2.6m to around 45,000 customers who received the letters between October 2008 and November 2010.

Sky News said that while the fake letter scandal fell outside the period covered by the results, due to be published next week, a large one-off charge to cover legal and regulatory costs is expected to be set aside.

Wonga’s dishonest activity prompted the City of London Police to say it would consider further action pending the outcome of the FCA’s investigation.

By Samantha Partington

Samantha Partington is news editor of Mortgage Solutions. Previously she worked for another financial trade title and before becoming a journalist worked as a mortgage broker and latterly for a mortgage, bridging and secured loan lender. Samantha is CeMAP qualified. Follow her on Twitter @SamPartingtonMS.

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