Last week we heard Wonga had been sending out letters under two fake law firms to recover debts from its customers. It now seems Wonga was not the only company using this ‘bullyboy’ tactic. It has now emerged that the Student Loans Company (‘SLC’) sent out letters to around 300,000 graduates since 2005 headed ‘Smith Lawson & Company Recovery Service’.
Following on from an investigation by the Office of Fair Trading in March the SLC was ordered to review its correspondence. The threatening letters SLC sent, gave the impression that this was a separate company, with the letters referring to a ‘client’ and ‘Do Not Ignore This Letter’. The SLC confirmed they had suspended the use of Smith Lawson branded correspondence but were adamant that it needed to recover these payments as it was collecting money owed to the taxpayer. The Department of Business, Innovation and Skills needs to hold the SLC, which is a Government subsidiary, to account with a full investigation as to how this tactic came about.
In the meantime, following on from Wonga having to pay £2.6 million in compensation to 45,000 people it sent letters to, there have been further calls for a criminal investigation into Wonga’s actions. It would be interesting to know how widely used this tactic is throughout the industry. If this is indeed common practice then this will not be the last time we hear about ‘fake law firms’. A clear signal therefore needs to be sent that this tactic will not be tolerated and a full police investigation of Wonga’s actions is required.