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This Bizarre Russian ATM Wants to Lend You Money

Walking past a row of vending machines and ATMs at the Kursky train station in Moscow, Sergei Amirkhanov stops in front of a bright orange cash machine. Instead of inserting his bank card, he scans his passport, poses for a photo and enters his mobile number. He receives a text message on his phone a few minutes later, telling him to return to the machine and withdraw the cash he needs.

This strange kind of ATM began popping up at railway stations and shopping malls around Moscow last year. It looks like a regular cash machine, but it’s designed to accept loan applications and dole out money on the spot.

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The loan ATM is a product of Oleg Boyko, a Russian billionaire who made his fortune running slot machine halls. When President Vladimir Putin banned gambling in 2009, Boyko moved the gambling business outside the country, but he continues to control financial firms and other companies in Russia. One of his investments is 4finance Holding and its affiliate, SMS Finance, which operates the micro-loan machines. Boyko, a paraplegic who helps support the Paralympic Games, has also dabbled in Hollywood. He’s an investor in Summer Crossing, a movie based on a Truman Capote novel that will be Scarlett Johansson’s directorial debut.

There are currently about 20 automated loan machines installed throughout Moscow. They allow customers to request as much as 15,000 rubles ($241) that must be paid back in 20 days or less. The interest rate is 2 percent a day, which works out to 730 percent on an annualized basis. That may seem insane, but some Russians have been willing to embrace the technology to make ends meet between paychecks.

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Amirkhanov, 37, took out a 3,000 ruble ($48) loan after he lost his construction job at a Moscow power station in February. He needed the money to hold him and his family over while he searches for work because his bank won’t let him borrow cash. “I have a banking card, but its balance is zero,” he says. “I am in a desperate situation.” Fallout from the conflict in Ukraine has taken a toll on the Russian economy, resulting in a freeze on some construction projects and an influx of Ukrainian refugees, who are creating more competition for jobs, he says. Amirkhanov was granted 15 days to pay back the loan, including 900 rubles in interest.

For many Russians, it’s the only way to borrow. After the value of the ruble began to plummet late last year, local banks took hits to their credit ratings and were no longer able to find lenders abroad. As a result, Russian banks have less cash to lend and are tightening client-scoring procedures to avoid bad loans. Leave it to a gambling magnate to have the stomach for risky consumer loans in this economy.

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Payday lenders similar to 4finance, such as Britain’s, are often characterized as vultures feeding on the vulnerable. Typical customers have poor credit or problems with employment or are uneducated about what financial options are available to them, according to Olga Naydenova, an analyst at BCS Financial Group in Moscow. “Their rates are way too high,” she says. “While regulation has been tightening for traditional banks, the micro-finance business has much softer requirements for capital adequacy.”

The absence of strict regulation allows micro-loan companies to provide options to people who would be passed over by traditional banks, according to Kieran Donnelly, chief executive officer of Boyko-backed 4finance. The company offers consumer loans in a dozen European countries, primarily through websites people access via computers or phones. More than 11 million loan applications have been submitted to 4finance, which lent €831 million ($944 million) last year. The company, which recently spun off the Russian SMS Finance unit to appease risk-averse investors, plans to hold an initial public offering as soon as 2016, Donnelly says. “Our objectives are about profitability and return on investment,” he says. “A big part of what we are offering to people is convenience.”

Recognizing that many potential customers may not have access to the Internet or trust it with their banking information, SMS Finance began working on the ATM and installed the first ones in Moscow in May 2014. They contain software that matches a photo taken by the machine with one on a passport to verify customers’ identities, which help the company evaluate each applicant’s creditworthiness within 15 minutes. It’s still something of an experiment, but the company plans to test the ATMs in Poland and Spain next.

When a loan repayment is due, customers can settle it at a local bank, an electronics store, online, or by using a digital payment system such as Qiwi or Yandex.Money. If someone tries to skip out on paying, company representatives send e-mails, text messages, and phone calls. After two to three months of chasing a customer, they may involve debt collectors. About 10 percent of borrowers default on their loans, but the company is recovering 55 percent of overdue debt, says Donnelly. As Boyko, the investor and gaming billionaire, can probably attest, those are better odds than he’ll get at the casino.

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How Yahoo Might Sell Billions in Alibaba Stock and Pay No Taxes


Yahoo! Inc. (YHOO) on Tuesday is expected to reveal something most companies usually try to keep secret: how it plans to avoid a multibillion-dollar tax bill.

The Web portal has spent more than a year figuring out how to cash out a chunk of its $40 billion stake in China-based Alibaba Group Holding Ltd. (BABA) Typically, a U.S. company faces a federal tax bill of about 35 percent when it sells stock in another enterprise for cash.

Yahoo took a $3 billion tax hit last year when it sold about $10 billion in Alibaba shares. This time around, activist investors are leaning on the Sunnyvale, California-based company to be more savvy.

Alibaba: China’s E-Commerce Giant

Marissa Mayer, Yahoo’s chief executive officer, probably will maintain at least part of the Alibaba holding to keep a finger in China’s fast-growing Web market. Were Yahoo to sell the entire stake, it could face a federal tax bill of as much as $14 billion.

Here are some of Yahoo’s options to avoid capital-gains tax, both legal:

Mimicking Malone

Last summer, John Malone’s Liberty Ventures wanted to avoid taxes on selling its stake in travel website TripAdvisor Inc. Liberty did so by transferring that stake, as well as online costume-retailer BuySeasons, to a new unit created specifically for the deal.

Photographer: Andrew Harrer/Bloomberg

Yahoo! is under pressure from activist investors to minimize the costs, especially after triggering a $3 billion bill last year after it sold a $10 billion chunk of Alibaba shares. Close

Yahoo! is under pressure from activist investors to minimize the costs, especially… Read More


OpenPhotographer: Andrew Harrer/Bloomberg

Yahoo! is under pressure from activist investors to minimize the costs, especially after triggering a $3 billion bill last year after it sold a $10 billion chunk of Alibaba shares.

Under the plan, the new unit took out a $400 million bank loan. Most of that cash was destined for Liberty and the new unit’s stock spun off to Liberty shareholders.

The expectation was that TripAdvisor would acquire the new unit in exchange for the travel site’s own stock. TripAdvisor also agreed to repay the $400 million loan.

When it’s all wrapped up, Liberty Ventures gets cash and exits TripAdvisor — without incurring the tax bill a straight sale would trigger. Liberty’s shareholders get stock in TripAdvisor as though Liberty had distributed its holding in the site to its own investors. Liberty’s investors also don’t face taxes on the deal.

In Yahoo’s case, it would spin off its stake into a new entity, which would borrow money and distribute the cash to the Internet company.

“The tax savings sort of gets carved up between the two parties and they each get a chunk,” said Robert Willens, an independent tax-accounting analyst in New York City.

Channeling Buffett

Another option is to follow Warren Buffett’s lead, with what’s known in tax circles as the cash-rich split.

Berkshire Hathaway Inc. and Graham Holdings Co. (GHC) last March agreed to a deal that lets Buffett’s company unload its stake in the former Washington Post Co. while avoiding capital-gains tax.

That deal called for Graham to transfer cash and a Miami television business — combined, roughly equal to Berkshire Hathaway’s investment — into a new subsidiary. Graham then shifts stock in that new unit to Berkshire Hathaway, while Buffett’s company moves its Graham stake back to the media company.

Economically, it’s as though Berkshire Hathaway sold its Graham stake for cash — and a TV station. But because the deal is structured as an exchange of shares, not a straight-up sale, it gets tax-free treatment.

Were Yahoo to follow this route, it would exchange Alibaba shares for a stake in a new unit that would consist mostly of cash. Alibaba would have to shed some assets for Yahoo to get the advantage of such a deal; a cash-only transaction probably would trigger a tax bill. Accounting experts say it shouldn’t be difficult to find something to throw in the pot.

With assistance from Brian Womack in San Francisco and Alex Sherman in New York.

To contact the reporter on this story: Jesse Drucker in New York at

To contact the editors responsible for this story: Tom Giles at Tony Robinson, Reed Stevenson

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Overland Park's AMG Services agrees to record settlement over …

An Overland Park-based online payday lending operation accused of deceiving borrowers by charging inflated fees has agreed to pay federal regulators $21 million, the largest such settlement ever.

Most of the record payout will be returned to borrowers as refunds. AMG Services Inc. of Overland Park and its partner company, MNE Services of Miami, Okla., also will forgive $285 million in unpaid fines and loans still owed by customers, according to the settlement announced Friday by the Federal Trade Commission.

“The settlement requires these companies to turn over millions of dollars that they took from financially distressed consumers, and waive hundreds of millions in other charges,” Jessica Rich, director of the FTC’s Bureau of Consumer Protection, said in a prepared statement.

“It should be self-evident,” Rich said, “that payday lenders may not describe their loans as having a certain cost and then turn around and charge consumers substantially more.”

Unexpected fees and higher-than-advertised interest rates often left customers with debts that more than tripled the amounts they had originally borrowed, the FTC alleged in court documents.

The settlement includes no admission of guilt by the companies. Efforts to reach a company attorney late Friday were unsuccessful.

In legal filings, AMG had argued that its affiliation with American Indian tribes should make the company immune to legal action.

It said the tribes’ sovereign status meant they weren’t subject to state or federal laws. A federal magistrate judge disagreed, ruling in 2013 that the lenders had to obey federal consumer protection statutes, even if they were affiliated with tribes. A U.S. District Court judge upheld that ruling last year.

AMG claimed to be owned by the Miami and Modoc tribes of Oklahoma and the Santee Sioux of Nebraska. But the tribes reportedly received only 1 to 2 percent of the revenue from each loan.

The real beneficiary allegedly was race car driver Scott Tucker, who used $40 million collected from borrowers to sponsor his racing team, according to a 2012 complaint filed by the FTC. Tucker has not settled the FTC charges against him. His case is pending before a federal judge in Nevada.

Lawyers for Tucker have previously said the business practices of the tribes were “fully compliant with federal law” and they would contest the allegations.

A growing number of payday lenders have migrated from storefronts to the Internet in recent years in a bid to sidestep state laws designed to curb predatory loans. Some companies exploit ties with tribes to avoid federal regulation, consumer advocates say.

Friday’s record payday loan settlement is significant because it shows that tribal immunity is not working as a business model for payday lenders, said Ed Mierzwinski, consumer program director of the consumer advocacy group U.S. PIRG.

“Online payday lenders have tremendous power to reach into consumer bank accounts illegally and take excess fees,” Mierzwinski said. “Fortunately, FTC and the courts rejected this one’s claims of tribal immunity from the law.”

Law enforcement officials across the country have received more than 7,500 consumer complaints about the firms in Friday’s settlement, according to the FTC.

The FTC said the two companies are both part of the same lending operation. The agency said AMG serviced cash advance payday loans offered by MNE on websites using the trade names Ameriloan, United Cash Loans, US Fast Cash, Advantage Cash Services, and Star Cash Processing.

The websites advertised a one-time finance fee and promised that customers could get loans “even with bad credit, slow credit or no credit.”

But the FTC says borrowers were misled about the real annual percentage rate of the loans and didn’t realize they would be charged additional finance fees every time the companies made withdrawals from their bank accounts.

Contracts with borrowers indicated that a $300 loan would cost $390 to repay, for example, when it really cost $975, according to the FTC.

The agency also alleges that the companies illegally made pre-authorized withdrawals from customers’ bank accounts as a condition of credit.

The Community Financial Services Association of America, a trade group for the payday lending industry, issued a statement Friday that distanced the group from the two companies involved in the settlement and expressed support for the FTC’s actions.

“These unscrupulous practices are not representative of the entire payday lending industry nor the online sector of it, and they harm the reputations of (association) members who uphold the highest lending standards in the industry,” the statement said. “More importantly, these bad actors create an even more confusing environment for consumers, making them more susceptible to fraud and abuse.”

AMG previously had reached a partial settlement with the FTC in 2013 over allegations that the company had illegally threatened borrowers with arrest and lawsuits. That settlement prohibited AMG from using such tactics to collect debts.

To reach Lindsay Wise, call 202-383-6007 or send email to Twitter: @lindsaywise.


No fresh loans to SpiceJet, says State Bank of India


State Bank of India is not looking at extending any loan to the cash-strapped airline SpiceJet, Chairperson Arundhati Bhattacharya said today.Stating that the bank does not have any exposure to the airline, she said: “We just have two current accounts with the airline and the bank is not looking at giving any fresh loan to the carrier.”Earlier this week, the Civil Aviation Ministry had said it may request Indian banks/financial institutions to extend loans of up to Rs 600 crore to the airline.A Ministry release had also that it would request the Finance Ministry to permit external commercial borrowing (ECB) for working capital as special dispensation.On rupee volatility, she said it came only a few days ago and she needs to watch out how long it lasts.On whether the bank is worried over unhedged corporate loan exposure due to the ongoing rupee volatility, she said “at this time no need to press the panic button.” “We always ask our clients to hedge but no one hedges completely. Hopefully all our clients have sensibly hedged what are the immediate requirements,” she told reporters on the sidelines of launching tech-learning centres for customers.She said the move is aimed at empowering the customers through technology and awareness of its tech channels amongst customers. The bank will be launching 385 such centres across the country, she added.The first centre was launched by Reserve Bank Deputy Governor H R Khan here this evening.She said by March 2015, there is a plan to install 4,000 additional cash-recyclers which serve the twin purpose of cash deposit and withdrawal. With these installations, the State Bank Group will have a network of 52,791 ATMs, CDMs, cash recyclers.She said that around Rs 44 crore worth of transactions happen at RBI every month out of which Rs 37 crore are generated manually.
“Out of the Rs 37 crore transactions, 65 per cent take place on alternative channels like ATMs, mobile banking and the Internet. We aim to increase it to 85 per cent in the next one year,” Bhattacharya said.

9 Scary Things Consumers Do With Their Money

The upside of fear

Fear can be fun. That’s why we like to watch horror movies, dress up as ghouls and goblins for Halloween and ride roller coasters. But fear can also be a useful tool. It motivates us to keep our cholesterol down and be cautious drivers, for instance. With that in mind, here are nine scary things consumers do with their money. If you’re guilty of any of the following, be afraid — be very afraid.

Auto title loans

With this scary loan, you leverage your car to get quick cash. Often, no background or credit check is necessary. You hand over the title to your car, and all you have to do is pay back the loan, plus interest. You will pay the loan back, of course. But because you may not be able to afford the interest rate (often 25 percent), you’ll probably take out another auto title loan. Don’t do it — this road is a dead end.

Payday loans

According to The Pew Charitable Trusts, 69 percent of first-time borrowers use a payday loan to fund a recurring expense, like the mortgage or food, and not an unexpected emergency. This is worrisome because if you’re having trouble paying regular bills and need a payday loan, you probably don’t have extra cash to pay for this loan. Like an auto title loan, payday loans are predatory. The lender is the predator. You are the prey.

Buying rent-to-own products

Rent-to-own stores are popular for a reason. If you need a refrigerator, a bed or a television, you can furnish your home for a low weekly price. But you’re going to live with a lot of financial stress. Many rent-to-own stores charge 100 percent or more for furniture, appliances and electronics. Over several years, you can easily find yourself paying $3,000 to own a $900 TV.

Carrying a large balance on your credit card

Carrying a balance isn’t cause for panic if you can pay off the balance in a short period of time. What’s scary is when you carry a large balance you can’t pay off for years. If you owe $10,000 on a credit card with an interest rate of 15.2 percent, it will take you 12 years to pay off the card if you’re just making the minimum payment (often 4 percent of the balance). You would pay $4,539 in interest on the $10,000 principal.

Racking up bank overdraft fees

If you’re spending freely and don’t realize your account balance is dangerously low, you can easily accrue overdraft fees. The problem? Not only are the fees high, but the banks are making a fortune out of your misfortune. The Consumer Financial Protection Bureau explains how devastating these fees are: “Put in lending terms, if a consumer borrowed $24 for three days and paid the median overdraft fee of $34, such a loan would carry a 17,000 percent annual percentage rate.”


Do we really need to explain why this is a bad idea? Last year, The Wall Street Journal analyzed a database of 4,222 Internet gamblers from 2005 to 2007. Of the top 10 percent of bettors, approximately 95 percent lost money. It’s one thing to go to a casino once a year or play the lottery occasionally, but when you’re doing it fairly regularly, you’re risking money that could pay your mortgage, credit card debts, retirement or your child’s college.

Claiming Social Security too early

This isn’t on par with gambling or taking out a dangerous loan, but the money you’re giving up is frightening, especially if your finances are wobbly. The earliest you can claim your benefit is age 62, but it will be 25 percent smaller than if you wait until your full retirement age of 66 or 67. If you’re in good health and can wait to claim, you’ll get an extra 8 percent a year between your full retirement age and age 70.

Chronically paying bills late

To forget every once in a while is human. But if you’re constantly paying bills late, like your mortgage, cable and utilities, consider that every bill likely has a late fee of 10 to 15 percent of the total monthly payment. That means you often have 10 to 15 percent less cash than you expected every month. And with credit cards, late fees often cause interest rates to climb, not to mention damage your credit score.

Not saving for a rainy day

According to, 26 percent of Americans have no savings reserved for emergencies, and 24 percent have less than three months’ worth of savings. This often isn’t due to reckless behavior; for many, it’s just an unfortunate reality. But not saving for a rainy day deserves to be on this list. If you haven’t saved for an emergency and something bad happens, you might think you have no choice but to pay bills late or worse, take out a very scary loan.

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Cash flow management issue for businesses of any size

Cash flow management can be a problem for any business. The income statement may indicate a profit, but an underlying condition can show up when the business runs out of cash. The worst symptom is an overdrawn notice from the bank. A lack of operating funds is common and repeatedly the cause of business failure.

Small businesses are vulnerable to cash flow problems since they frequently operate with little or no cash reserves. Sometimes, the owner is too busy to notice negative cash flow. In its simplest form, cash flow literally refers to the movement of cash into and out of the business. Cash flow management includes identifying both the sources and uses of cash. Even if it is possible to raise more money from other sources, such as the owner’s personal funds, sooner or later the timing of cash inflows must match the outflows if the business is to survive. A good tool to have is accounting software such as QuickBooks, Sage One, or FreshBooks that allow the owner to have Internet access to financial reports. Cash flow management can easily become a daily or weekly routine. It’s crucial to enter the data correctly in the accounting software and most programs offer tutorials and online help.

A deficit needs to be addressed when there is negative cash flow. Two options exist: Spend less or increase revenues. Many small businesses struggle to get spending under control. Oftentimes, they do not have proper expense management policies in place. If spending less isn’t an option, it may be time to look at accounts receivable and inventory. Collections could be made sooner or less cash can be tied up in inventory. For certain types of businesses that have substantial accounts receivable, the owner might be able to utilize a factoring provider to gain immediate access to revenues. Trade credit is another avenue to slow cash outflows by asking suppliers if they offer extended terms or special financing.

When a mature business needs help with their current cash flow situation, sometimes another set of eyes can spot problems and offer solutions. The Small Business Development Center offers assistance to businesses that may be struggling by helping them to understand their financial statements and identify areas for improvement. Sometimes a small loan or line of credit can be in order, and a business plan will help persuade a lender. Ultimately it is about understanding the business’s cash flow cycle. A controlled cash flow will more than repay the time and effort given to achieve it. It may save the life of the business.

Gordon Smith is a business specialist at the Small Business Development Center at Clovis Community College. Call the center at 769-4136 or visit

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'Abusive practices' widespread with online payday lenders: study …

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Online payday lenders are often ‘fraudulent and abusive,’ study finds

Herb Weisbaum TODAY contributor

Oct. 3, 2014 at 12:18 PM ET

Facebook Reddit Pinterest Email Going online to apply for a payday loan is convenient and confidential – but it’s also risky, according to a report released Thursday by the Pew Charitable Trusts.
This first-ever national survey of payday loan borrowers found that a number of fraudulent, abusive and even illegal practices were often associated with these Internet lenders. The key findings:32 percent of online customers report having an unauthorized withdrawal from their bank account
46 percent said the lender made a withdrawal that overdrew their checking account – twice the rate of those who borrowed from a payday loan store
30 percent said they were “threatened” in some way by the lender or a debt collector
39 percent discovered that their personal or financial information was sold to another company without their knowledge
Shutterstock Going online to apply for a payday loan is convenient and confidential – but it’s also risky, according to a new report by the Pew Charitable Trusts. “Our report makes clear that abusive practices in the online payday loan market not only exist but are widespread,” said Nick Bourke, director of Pew’s small-dollar loans project.
Online payday loan companies have advertised aggressively in the last few years and it has paid off. Since 2006, revenue generated from these short-term loans tripled, topping $4 billion last year, the report noted.As the industry has grown, so have the complaints.Pew estimates about 90 percent of the payday loan complaints to the Better Business Bureau are for online lenders, even though just 30 percent of payday loans originate online. Most of these complaints deal with billing or collection issues and most are against online lenders that are not licensed in every state where they do business.
Pew points out that many of the problems it uncovered violate the guidelines of the industry’s own trade group, the Online Lenders Alliance (OLA). “While there are bad actors out there that should be identified and driven out of business, OLA and its members are working to ensure consumers are treated fairly and use the lending products responsibly, including providing assistance, such as a repayment plan, when consumers are unable to repay their loans,” Lisa McGreevy, OLA’s president and CEO, said in a statement.Ads can misleadPayday loans are advertised as short-term loans – typically a two-week, flat-fee cash advance. But all too often, that’s not the case.Pew researchers concluded that many online payday loans are designed to promote “long-term indebtedness” because they automatically renew at the end of the pay period – which results in an additional fee. Nearly a third of the online borrowers interviewed by Pew said they discovered that the lenders only withdrew the fee and not the principal on the due date. As a result, they could make payments forever and never pay off the loan.Keep in mind: Online payday loans are not a bargain. The typical fee for borrowing $100 for two weeks is $15 at a storefront and $25 online.Online payday lending is differentIn most cases, online lenders get their customers from lead generators, which are independent companies that place the ads and collect the personal information from the borrower. Lead generators sell completed applications, which often include checking account and Social Security numbers, to potential lenders. Even after a lender buys that lead, it can still be available for others to buy. This exposes the borrower to unauthorized withdrawals and the potential for identity theft. As the report noted, “This practice of reselling leads creates opportunities for fake debt collectors and others to buy the information and attempt to collect money using aggressive tactics.” The Consumer Financial Protection Bureau is drawing up proposed rules to regulate the online payday loan industry. Pew said it would like to see safeguards that protect small-dollar borrowers from unscrupulous lenders, and apply rules that prohibit lending to customers who are unable to repay the loan.The bottom line Consumer advocates have long advised against payday loans because of the steep fees and the lump-sum repayment requirement. Pew’s research shows that the average person who takes out one of these two-week loans is actually in debt for five months of the year.This new report makes it clear that the potential for problems is much greater when the transaction takes place online rather than at a store. And if something does go wrong, it’s often a lot harder to deal with it.If you have a problem with an online payday lender, file a complaint with the Consumer Financial Protection Bureau.Herb Weisbaum is The ConsumerMan. Follow him on Facebook and Twitteror visit The ConsumerMan website. Tags:TODAY Money, Internet, payday-lenders sharetweetemail

Payday Loan Startup That Promised to "Kill" Finance Now Total …

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In 2009, Sarah Lacy, then a writer for TechCrunch, set the gold standard for startup hype in a write-up about Wonga, a payday loan company that just might “upend the world’s financial institutions.” Today, Wonga is about as hated as Wall Street and was just forced to write down £220m of debts for 330,000 customers because the loans were unethical.

Even God is mad at Wonga.

The company is based in London, but the list of venture capitalists who invested $145.4 million over the years includes Silicon Valley stalwarts like Accel Partners and Greylock. Wonga’s other investors are prominent in Europe. Local reports of its implosion have been relatively mild, but Wonga’s misdeeds are pretty spectacular.

In May, Wonga’s CEO stepped down after a scant six months on the job. In July, Andy Haste as chairman, hoping his “blue chip financial credentials” might be able to make people forget that the company sent out fake legal letters to scare borrowers who had trouble paying back their loans:

The UK’s biggest payday lender has been without a permanent chief executive or chairman since its co-founder Errol Damelin quit as chairman in June last month. Damelin’s departure, seven months after he stood down as chief executive, came just before the financial regulator ordered the payday lender to pay £2.6m in compensation for misleading customers by issuing letters to struggling borrowers under the name of fake legal firms.

The Financial Conduct Authority said Wonga had been guilty of “unfair and misleading debt collection practices” after it emerged the lender had made up the companies to threaten legal action against customers.

The Law Society has called for a criminal investigation but Haste said Wonga had not been contacted by police. “As of today we are not under criminal investigation and our whole focus is working with our regulator to pay compensation to customers in a timely manner.”

Wonga attracts high interest from City of London policeWonga attracts high interest from City of London policeWonga attracts high interest from City of London p

The lender says the issue is ‘historic’ but the Law Society has asked the police to…Read moreRead on

The write-down as well as new “affordability checks” were part of a “voluntary agreement” with the UK’s Financial Conduct Authority about Wonga’s lending practices, reports the BBC.

The company, which has faced criticism for its high interest rates and debt collection tactics, made the changes after discussions with regulators.

Customers in arrears whose loans would not have been made under the new checks will have their debts written off.

A further 45,000 customers in arrears will not have to pay interest on loans.

The BBC said Wonga lends money to roughly a million customers a year. In July, Haste promised to enforce stricter criteria. The process sounds corrupt from start to fake letter finish. Take this example from a 20-year-old customer named Elliott Gomme who easily gamed the system to get £120 to go on vacation by claiming that he worked full-time:

“My bank couldn’t give me an overdraft or anything, and so I went to [Wonga],” he says.

He received his money and went on holiday, but a few weeks later he says the firm started calling him and he says they were “constant”.

“They were ringing me every day,” he says. “They were telling me how much I owe and that there was added interest.”

Elliot says that a few months later he was being told his debt had risen to more then £800 and it began to affect his day-to-day life.

Reporters are no better than investors at picking which startups will succeed. We’ve all made wrong calls. But what’s so strange about TechCrunch’s post from 2009 is that Wonga was already controversial, a fact Lacy noted and dismissed:

Wonga: How the Net Should Kill the Finance Industry | TechCrunchWonga: How the Net Should Kill the Finance Industry | TechCrunchWonga: How the Net Should Kill the Finance Industr

What’s awesome about the Internet is how it breaks up monopolistic markets where middlemen unfairly …Read moreRead on

Critics have said that Wonga is usurious by charging a 1% interest fee per day. But that’s a knee-jerk response. […]

Sure, you can say Wonga is dangerous because it’s giving people an easier way to live outside their means. But that’s a bit like arguing giving kids condoms encourages teenage sex. You can’t change human behavior, but you can help make people safer.

Now here’s the downside on Wonga: It’s only available in the UK . . .

Tech bloggers must be humans because you can’t change their behavior either.

To contact the author of this post, please email

[Image via Associated Press]


Payday Loans Get Wage Day For Same Day Urgent Use

Majority of folks find their funds finished much before their payday regarding their expensive day to day to price range. Since, your usual life is packed with several small expenses and you won’t be able assess them before, you find this job tough payoff them when they emerges suddenly before you. Small cash loans are only the result of such demands among the borrowers that a person to arrange even small sum there.

Once financial institution approves your own application, the loan amount in order to be transferred to your checking savings. The lender deposits you will get into your bank within next each day. After the completion in the loan period the repayment amount will automatically be debited from your bank account to the lenders account.

The short term money in advance scheme is a scheme during you will have the funds for the aim of of larger financial operation like, major house repairs, vehicle repairs, family trips, sudden educational fees and a lot more. The amount is larger comparatively. In which means you can resulted in payments either online or with assist of of smaller instalments is going to also be determined your monthly or bi-monthly pays. Pace of interest rates are also affordable and inexpensive. The process application is also very easy because the device is available online. You requirement to fill your online prescribed form. As soon as you complete the form, money will be transferred within your bank concern.

The best way to apply for instant cash loans advances is the internet way. Can be as easy to do is take the online website and send in the online form along with you accurate information and then submit the information. The information is then send to at least of several lenders who then verify the data and then decide to approve or disapprove mortgage loan. If the loan is approved then the particular reaches banking account directly. Collected was specially made for your comfort, to ensure that you do not spend a lot of time and energy in obtaining a loan.

Take some of the 5 ideal way to make money out of your fascination. Some may need to have a huge financial. However, take a look at the other techniques small quick cash loans can deal with. Try to look at issue lenders in the city to be able to sustain your hobby on the cheap now.

Here good tell you about unhealthy credit score i.e. may get you cannot credit. Occasionally , you pay no on times and get bad capital. The vendors use this to make you become pay a noteworthy more interest than your typical loan. The loans appear in both unsecured and secured finance (much since the regular bank loans) and follow related standards. A secured loan requires a down payment as such, this typically involves putting your house in ownership of the bank account in case you can’t pay back the amount you rental. Unsecured loans do not necessitate this associated with safety measures and can generally be applied for and within 48 hours you must have the cash in on your financial institution.

A borrower may also apply for such loans via internet. In this case, he/she has in order to fill within application form available on the webpage of financial institution. Once the form is filled and submitted, it is sent for thank you. If everything is as per the terms and types of conditions of the lender, then the loan could approved easily.

This is considered among the affordable payday cash advances so that you can borrow comparatively at lower rates. Usually are all products short term loans for shorter repayment period. The loan amount you borrow from cheap payday cash advance loan can supply for many unexpected monthly bill. You can use it for real estate repair, car repair, unexpected medical bills or some other expenses you have to meet.

Bad credit history is no issue. Online payday loans are notorious for promoting themselves as “no credit check” loans. This particular one more attraction related to applying for fast cash from a cash payday loan lender. Many americans have themselves in an area where other available choices for money are narrow. Banks and credit unions concentrate on your actual credit score rating and handmade cards look closely at your creditors to income ratio when determining your approval. If the loan gets approved, most likely the pace for these loans or credit cards will be considerably higher than average.

N such bad situation, you tend to be seeking for financial aid to get regarding your financial troubles. To beat those bad conditions, leading way end up being apply for 90 day payday loans available widely these days.


Are You Cash-Strapped? Avoid These 5 Potential Scams


If money’s tight, you’re probably looking for any way to get some cash and get it quick. But if you don’t do your homework, you could end up in a worse situation.

Scam artists prey on vulnerable consumers by making them think they have solutions to financial woes when they’re really just trying to take their money.

With consumer debt at a whopping $11.28 trillion, it’s easy to see why con artists try to take advantage of people in dire financial straits.

“When the economy goes into recession, these organizations and scam artists come out of the woodwork,” says Steve Bernas, president and CEO of the Better Business Bureau of Chicago and Northern Illinois. “People who need money are really grasping at any straw to stay afloat.”

Here are five potential schemes to watch out for:

Advance-Fee Loans: Any loan company that asks you to pay fees upfront before approving a loan is breaking the law. In this scheme, the con artist insists on the consumer paying taxes or fees before they’ll issue the loan. (A legitimate lender also will charge fees; but they’ll take it out of the money they lend you.) Red flag No. 1: If a loan company doesn’t care about your credit history, you probably can’t trust them. They don’t care about your credit because they never intend on giving you the loan. Red flag No. 2: Don’t trust a loan company that keeps calling you. Often these scams are based in other countries. Scammers may “spoof” local numbers, so it looks like you’re getting a call from a legitimate U.S. number, but you’re not. Work-from-Home: The potential to earn cash from your bed sounds great. The problem is that scam artists know this, too – and they try to sell people expensive starter kits or training or make them put in lots of unpaid hours before their fake “opportunity” disappears. These schemes can take many forms, including envelope-stuffing, assembly or craft-work, rebate processing, online searching and medical billing. The reality, says the FTC – “many of these jobs are scams.” Make sure you thoroughly research any work-from-home offer and fully understand the compensation plan. For more, the FTC’s website HERE. Lotteries and Giveaways: Legitimate sweepstakes do not ask you to pay money to increase your odds of winning. Nor do they ask you to wire money to insure your winnings or pay taxes before you can collect your prize money. If you receive a prize notification mailed by bulk rate, it’s probably fake; ditto with overseas lotteries. And beware any sweepstakes offer that says you have to attend a sales presentation to win a prize. You will be put into a high-pressure meeting that forces you to act fast before the prize or opportunity is gone. Mortgage Relief: Watch out for foreclosure rescue scams. Some companies offer phony counseling or phantom legal help. The scammers tell you to a pay a fee for them to negotiate with a lender to lower your mortgage payments. But once you send your money, they stop communicating with you, leaving you in worse shape with your lender. Other scams involve title fraud, such as “rent-to-buy” schemes in which scammers have you surrender the title to your house. Similarly, the bait-and-switch loan scam asks you to sign for a new loan to make your mortgage current, but in the documents, there’s a section that surrenders the title to your house in exchange for the rescue loan. Student Aid: The first thing to remember is don’t pay to find aid money. The Free Application for Federal Student Aid (FAFSA) is – just like the name says – free. Use the FAFSA to apply for federal grants and loans. You don’t need to pay a service to find these for you. If you’re struggling with student debt, the government can help you consolidate your student loans — for free. For info on consolidation as well as federal student aid programs, check out

Inoculating yourself against rip-offs:

Deals that seem too good to be true most likely are. Don’t fall for miracle offers. Do not pay with money orders, cash or wire transfers whenever possible. Often times a credit card company can stop a fraudulent payment within 60 days. Research companies before doing business. Check with the Attorney General in the state in which the company operates, the Better Business Bureau and other online consumer sources. For trustworthy, non-profit consumer credit help, contact the National Foundation for Credit Counseling. Check out the Internet Crime Complaint Center and the Federal Trade Commission for more tips and ways to file a complaint about a scam. You can do so at the BBB too.

Got a consumer problem? The ABC News Fixer may be able to help. Click here to submit your problem online. Letters are edited for length and clarity.