Kudos to Judge Bob for rejecting Amigo Loans’ dirty contract

M

r Judge Miles (Bob, at the pub) is not one of those overworked bankers prone to over-the-top rhetoric. You will not find any “blatant behavior”, “extravagant barbarity” or “shameful dishonesty” in his High Court judgments.

Amigo had tried to get his approval to pay thousands of his bad-selling victims with just 10p in the pound of their compensation.

Answer from Miles, with the help of the Financial Conduct Authority: not so fast, amigo.

Pointing out that Amigo’s clients are among the most vulnerable, slender and financially unsophisticated in the country, he ruled that it was dead wrong that they should bear the brunt of the punishment for the wrongdoing of Amigo and not its shareholders.

How right he is. Amigo’s abused clients should come above shareholders in the creditors’ hierarchy. They should be among the last to endure the pain, not the first.

If that means sacrificing some of the share price gains that the company’s dirty trade triggered, so be it.

Amigo has claimed he will go bankrupt unless his victims accept the current offer. Is that so? Even after the shares fell today, it’s still worth £ 45million. Judge Miles and the FCA are right to call his bluff.

Let the administrators go and come back with a fairer offer.

Provident Financial and others thinking about how to treat their poorly sold customers, pay attention.

(This article first appeared in Tuesday’s Evening Standard)


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