Shareholders in Amigo Holdings have blasted the City watchdog for ‘forgetting’ investors in dealing with the lender.
The Amigo Shareholders Action Group, representing around 8,000 private investors who own 75 per cent of the firm, has written to the Treasury complaining about the Financial Conduct Authority’s (FCA) handling of Amigo’s troubles.
The group, led by co-chairmen Paul Mansell and Mo Majid, is demanding the Treasury probe the FCA’s actions.
Protest: The Amigo Shareholders Action Group has written to the Treasury complaining about the Financial Conduct Authority’s handling of Amigo’s troubles
Amigo offers high-interest loans to customers with a poor credit score, as long as they have a friend or family member willing to make the repayments if they can’t.
It hit trouble after rules on affordability checks changed, and several customers who should not have been given loans wanted compensation.
Amigo realised it didn’t have the £151million needed to pay them, so it tried to set up a scheme that would see them receive as little as 10p for every £1 owed.
But after a last-minute intervention from the FCA, which said the scheme was unfair to customers, a High Court judge blocked it and sent Amigo back to the drawing board. Amigo boss Gary Jennison says it cannot afford more compensation.
In their letter, seen by the Mail, Mansell and Majid said: ‘Why the FCA believe it appropriate for us to ‘take a haircut’ when we are already bald is entirely inappropriate.’
It criticised the FCA for failing to indicate clearly what they would require from a new scheme, and for making Amigo incur more costs.
It added: ‘It seems when companies are in difficulties, protecting the potential residual value of companies for shareholders is forgotten.’ The FCA declined to comment.
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