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Payday lenders 'out of control'

Fresh evidence of "out of control" payday lenders failing to act responsibly and hounding people for money was released by a debt advice charity today.

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Charity: Customers 'hounded' at their homes by lenders

Citizens Advice said the Office for Fait Trading (OFT) must take "tough and immediate action" on payday lenders following a 12-week deadline to prove their good behaviour.

Analysis from 780 cases reported to Citizens Advice between November 2012 and May this year found:

  • People were being chased for loans they had never taken out
  • Customers were being "hounded" at their home to shame them into paying up
  • Struggling borrowers' bank accounts were being drained of cash "without any warning" by lenders using a type of payment agreement called a continuous payment authority (CPA)
  • In some cases lenders also took more than they were owed and refused to give a refund

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