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<p>When a firm enters administration, assets are pooled and used to cover customer
redress claims and administration costs. In the case of Wonga, the pooled assets are
not sufficient to meet all of the redress claims. The administrator, Grant Thornton
UK LLP, is therefore unable to pay out 100% of these claims and must address claims
in order of the creditor hierarchy. The number of redress claims and the amounts due
in the case of Wonga is a matter for the administrators.</p><p>The Financial Conduct
Authority (FCA), who regulate payday loans, has the power to decide which activities
are given Financial Services Compensation Scheme (FSCS) protection. In 2016, the FCA
decided not to extend FSCS protection to most consumer credit activities because it
believed other regulatory requirements were sufficient. The full reasoning behind
the FCA’s decision is set out in a letter from their Chief Executive to the Chair
of the Treasury Select Committee on 15 February 2019.</p>
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