Secure My Money Limited (SMM) persuaded financially distressed people to provide bank or credit card details so the company could take money without their knowledge, the Insolvency Service said.
When confronted, the credit firm made misleading statements over refunds to customers, company bankers and the Financial Conduct Authority (FCA), the Insolvency Service’s investigation found.
The directors shared a 28-year ban with Mark Robert Kennedy and David John Carter Mullins banned for eight years each, Edward John Booth for seven years and Christopher Brotherton for five years.
The four had a responsibility for SMM trading with a lack of commercial probity from October 2013, the Insolvency Service said.
The regulator found the firm, which included brands Loan Zoo, Loan Junction, and i-loans direct, duped customers into paying a £69 upfront fee by promising to compare loans from a range of lenders – but in effect did nothing in return for the money.
The customer base for SMM was largely individuals who had been turned down by lenders and were searching for loans, the Insolvency Service said.
SMM was then found to have charged monthly fees without permission, knowledge or any clear explanation or justification.
Took advantage of desperation
SMM also directed customers to similar brokers, meaning these people were exposed to the potential to be charged a number of times by similar brokers, the Insolvency Service said.
Kennedy, Mullins and Booth shared responsibility for allowing the credit firm’s website to remain active, resulting in £181,393 being taken from individual bank accounts – even after SMM had agreed with the FCA to remove it from public access and sight.
At liquidation on 31 August 2014 SMM had liabilities totalling £357,628, with assets estimated to be £6,000.
Cheryl Lambert, chief investigator at the Insolvency Service, said: “This company was a shark feasting in a pool of the most vulnerable and financially distressed.
“It took advantage of their desperation for immediate funds, and its own technical expertise, to induce the unwary into a trap from which it was difficult to escape.
“The system that was created resulted in some of the least financially sophisticated members of society having their banking and personal details pinging around a school of sharks to create a feeding frenzy.
“This was utterly cynical and thoroughly reprehensible commercial activity.”