The Law Society has contacted the police and Solicitors Regulation Authority demanding further investigations after payday lender Wonga was found to have sent letters appearing to come from law firms.
In a statement released today, the Society said it was 'alarming' that Wonga had sent letters to in-debt customers threatening legal action.
The case has highlighted a loophole where organisations and individuals can pass themselves off as legal professional by calling themselves law firms. Yesterday the SRA said it would not take action of its own as Wonga had not used the protected word 'solicitor'.
Shadow minister for competition and consumer affairs Stella Creasy said Wonga's apology was 'not good enough' and suggested it could be a criminal matter under the Administration of Justice Act.
The Law Society has now written to the police, SRA and Financial Conduct Authority for further information.
A spokesman said: 'The case has highlighted a number of important issues around organisations and individuals presenting themselves in a misleading way so that the public believe them to be regulated legal professionals, such as solicitors.'
Investigators found that Wonga sent communications to customers under the names 'Chainey, D'Amato & Shannon' and 'Barker and Lowe Legal Recoveries', leading customers to believe that their outstanding debt had been passed to a law firm, or other third party. Further legal action was threatened if the debt was not repaid.
Neither Chainey D'Amato & Shannon nor Barker & Lowe existed. Wonga was using this tactic to maximise collections by piling pressure on customers.
Compensating around 45,000 affected customers is likely to cost £2.6m.