Newcastle United sponsor payday lender Wonga attacked after being fined £ 2.6million for misleading 45,000 customers


Last night, a NORTH EAST MP called on Newcastle United to reconsider their relationship with payday loan company Wonga after being ordered to pay £ 2.6million in compensation for ‘unfair and deceptive debt collection practices “.

Jenny Chapman, MP for Darlington, said the firm, which sponsors the football club, had “behaved in a despicable manner” after sending letters to overdue clients from non-existent law firms threatening legal action .

The Financial Conduct Authority (FCA) said that in some cases, Wonga has added fees to clients’ accounts to cover the administration costs for sending the letters.

He added that consumers were under “great pressure” because of communications sent by fictitious law firms to make repayments on loans that many could not afford.

Wonga contacted delinquent clients under the names of Chainey, D’Amato & Shannon and Barker and Lowe Legal Recoveries, leading clients to believe that their unpaid debt had been transferred to a law firm or other third party.

Further legal action was threatened if the debt was not repaid.

None of these companies existed and Wonga was using this tactic to maximize collections by increasing pressure on customers, the regulator said.

Ms Chapman said, “I think the compensation should be paid at Wonga’s interest rates. It is good that they are being forced to repay, but that ignores the fact that they are enticing people to take out loans that they cannot afford to repay.

She stressed the importance of companies like Darlington Credit Union as the best options for those in desperate need of a loan.

She added, “It’s heartbreaking to see little kids running around in soccer jerseys with Wonga on them because it desensitizes debts to young people.

“I hope Newcastle United’s relationship with Wonga will not be long and I urge them to reconsider the deal.”

Tim Weller, Interim CEO of Wonga, said, “We would like to extend our sincere apologies to anyone affected by the historic debt collection activity and for any distress caused as a result.

“This practice was unacceptable and we voluntarily ceased it almost four years ago.”

Citizens Advice CEO Gillian Guy said, “Irresponsible payday loans have been a plague for borrowers looking for a short term loan to tide them over. People come to Citizens Advice because payday lenders harass them, take more money than they owe, and sue people for debts they don’t have.

Martin Lewis, Founder of, said: “It just goes to show that if Wonga is hiring expensive marketing, PR and public affairs consultants to try and position themselves as ‘the good guys in a bad industry’, it is a sham.

“Using lawyers as bogus as your puppets and then having the stomach to make people pay for it is a thug tactic, aimed at scaring and intimidating people who are already in trouble.”

The move comes after Sir Hector Sants, former chief executive of the Financial Services Authority, was appointed to head a task force for the Archbishop of Canterbury, Justin Welby, on responsible savings and lending.

Sir Hector launched the Church Credit Champions Network aimed at providing an alternative to payday lenders.

Mr Welby received wide publicity last year when he said he told Wonga founder Errol Damelin he wanted to eliminate payday lenders by creating credit unions .

A Church of England spokesperson said: “This highlights the need for more responsible alternatives to payday loans and other forms of high cost credit.

“This is why the Archbishop’s Task Force is developing a set of practical initiatives to address the need for more affordable and responsible lending and savings opportunities.”

A spokesperson for the Diocese of Durham said, “We have been talking about credit unions and Wonga and payday loans for a very long time.

“We talked about getting churches to support local people and credit unions are a more affordable way and it keeps money in the community.

“The only thing we’re saying is you have a choice and community credit unions / banks are the right choice.”

Newcastle United declined to comment.

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