Wonga’s founder, Errol Damelin, cashed in £17m of shares just weeks after he quit as chief executive of the payday lender.
Damelin, a South African fitness fanatic who founded Wonga in 2006, sold 4.5m shares for £3.75 each, according to new filings at Companies House. The shares were sold on 3 December 2013, less than three weeks after he announced he would stand down as chief executive.
The shares, were sold via Castle Bridge Ventures, a British Virgin Islands registered trust he owns. They were bought by the Wonga Group Limited Employees’ Benefit Trust, which the company set up to buy staff shares in order to award them as bonuses to other employees.
Wonga confirmed that “an employee share purchase took place in 2013”, but declined to provide any further details.
Castle Bridge Ventures retained 12.3m shares, which would be worth a further £46m at the £3.75 valuation. But the value of the shares in the privately held company will have fallen dramatically following a series of recent scandals at Wonga, including its sending threatening letters to customers from fake law firms named after its employees.
Wonga was this month forced to write off £220m of debts owed by 330,000 borrowers. New Wonga boss Andy Haste said that the firm had “lent to people we should not have lent to”.
Haste, a respected City veteran who joined the company as chairman in the summer, said he would “not apportion blame” to Damelin, who quit the company entirely in June.
Damelin had described Wonga’s interest rate – which can rise up to 5,853% per annum – as a “great deal” and called for tougher regulation to “keep the bad guys out”. The lender, he claimed, used sophisticated algorithms to ensure it did not lend to people who could not afford to repay.
