In addition, two associated companies – Blue Sky Personal Finance Limited and Money Worries Limited – have also been deemed unfit to hold consumer credit licences.
The OFT’s decision was taken after finding that Wales-based Yes Loans, which deals in unsecured, short-term, guarantor and payday loans, had failed to comply with the Consumer Credit Act 1974 and with requirements imposed by the OFT in July 2009.
Despite Yes Loans making changes following the investigation, the OFT said it had determined that evidence of “prolonged engagement in deceitful and oppressive business practices” and the continuing presence of some staff responsible for running the business made Yes Loans unfit to hold a consumer credit licence.
The directors of the three companies said they were “disappointed and saddened” by the decision, having “worked tirelessly” to make improvements, and are taking advice on lodging an appeal.
The OFT said that Yes Loans had engaged in unfair business practices, including:
- using high pressure sales tactics to persuade consumers to provide their debit or credit card details on the false premise that they were required for an identity and/or security check
- deducting brokerage fees without making it clear that a fee was payable and/or without the consumer’s consent
- failing to introduce some consumers to the product originally sought, frequently arranging short-term, high interest loans instead
- misleading consumers into believing it was a loan provider rather than a credit broker
- treating customers poorly by not providing refunds in a timely manner.
David Fisher, director of consumer credit at the OFT, said: “We will take decisive action to tackle businesses that fail to treat people properly, especially the most vulnerable.
“This action also makes it clear that belatedly changing business practices when facing the prospect of enforcement action by the OFT does not make a company fit to hold a credit licence.”
Yes Loans, Blue Sky Personal Finance Limited and Money Worries Limited have 28 days to appeal the OFT’s decision, which will not take effect until the appeal period ends.
A statement from the directors of the three firms said: “We are very disappointed and saddened by the OFT’s decision to revoke the Consumer Credit Licences of Yes Loans Ltd, Blue Sky Personal Finance Ltd and Money Worries Ltd.
“We have all worked tirelessly to implement significant and fundamental advancements to the businesses. We are disappointed that, despite recognising this, the OFT has decided to revoke the licences of three long standing businesses, which provide a loans brokerage service and other personal financial services to many thousands of satisfied customers.
“We are currently taking advice with regard to lodging an appeal against the decision. No jobs are at risk within the companies concerned, regardless of the outcome of any appeal.
“Currently and throughout any appeals process, our licences remain valid and allow us to continue to trade.”
Yes Loans Ltd is not connected to Y3S Loans.
