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MP&#39s plea for lenders to stop &#39misery&#39

Royal Bank of Scotland and sub-prime lender igroup have been slammed in the House of Commons for failing to end the “misery” of borrowers with subsidiary companies.

Labour MP Dr Brian Iddon last week accused subsidiaries of lenders such as igroup – in which RBS has a 49 per cent stake – of targeting financially vulnerable borrowers with the aim of repossessing and reselling the properties they lend on, with the consent of parent firms.

Iddon said such companies often dupe people into borrowing more money than they can afford on extortionate interest rates which are not properly explained. He also claimed the agents of such lenders often pressurise borrowers, fail to disclose details of their excessive commission and sell “worthless” payment protection schemes.

Iddon said: “I challenge igroup and Royal Bank of Scotland to end the misery of these borrowers. Government action on the poor practices of these companies is long overdue.”

An igroup spokesman says: “As a third-party servicer, igroup deals with accounts that are sometimes the subject of complaint. We report on these to the OFT on a quarterly basis and make recommendations to the owner of the loans.”

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