Cash Genie is the latest of several overnight loan companies to fall under increased scrutiny for treating customers unfairly. In this case though, it was a self-reported matter in which the firm notified the Financial Conduct Authority (FCA) of potential noncompliance.
In a sign of good faith, parent company Ariste Holding Limited (AHL) notified the FCA that there had been some issues discovered that might have caused negative impacts to the customers of Cash Genie. The condition of this announcement is that the company will be conducting an internal investigation and reporting back to the FCA what it finds. FCA has appointed an overseer of a consumer redress scheme that will determine the scope of any violations, ensure proper compensation of any victims and confirm that the necessary changes have been enacted to prevent future occurrence.
AHL reported three issues to the FCA.
If the admissions are true, it could lead to some hefty refunds to be paid to current and former Cash Genie customers. There is no indication of what, if any such refunds could amount to. Still, even a refund will do little to repair the damage done to credit scores and bank accounts.
Ever since the FCA began regulating payday lenders, there has been a flurry of announcements regarding the ill-treatment of customers. Recently announcements were made regarding £700,000 in customer refunds by the Money Shop, fake collection notices mailed by Wonga and noncompliant advertisements by payday lender Sunny (action taken by Advertising Standards Authority).
The entire industry is taking notice of FCA’s strict regulation of market operations. All eyes will be on Cash Genie to see what the results are of its consumer redress scheme.
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