Yes Loans, the UK credit broker, has had its licence taken away by the Office of Fair Trading (OFT) due to concern that it used ‘deceitful and oppressive’ business practices. Two associated businesses, Money Worries Limited and Blue Sky Personal Finance, have also had their consumer credit licences revoked.
After a long term investigation, the OFT stated that Yes Loans purposely sold expensive payday loans to their customers instead of what they actually wanted.In addition, it also misled some of their customers into thinking that they were a loan provider instead of a payday loan broker and thus tricked customers into giving out their credit details.
The company would tell customers that they needed the credit card numbers for security checks.A joint statement put out by all of the affected firms stated that they have worked endlessly in order to make advancements in business and they are disappointed that although the OFT realises their efforts, they have decided to take away the licences of all three businesses that offer a loans brokerage service.
They also said that the firms are taking advice about how to appeal against the decision and at this point jobs within the companies are not at risk. Throughout the appeals process their licence will remain valid so that they can continue to trade.
A new MP report stated that payday loan organisations need better regulation, especially since they are now soaring as the costs of living continue to increase and there are higher unemployment numbers now than ever before. The Business, Innovation, and Skills committee however stated that there has not been much progress yet in addressing the grey area.