Lithuanian banking regulators have hit a consumer credit company with a fine of €30,000 for issuing loans to unemployed applicants, the biggest penalty of this kind to date.
© Corbis

The Bank of Lithuania inspected over 3,000 consumer credit contracts of an unnamed company, concluding that every fifth loan was issued to people who had no regular income.

The company also violated regulations concerning proper screening of applicants and their financial liabilities. An additional investigation revealed that the credit company charged more on arrears than permitted by law.

According to the Bank of Lithuania, the company has been fined before for similar violations, but has acknowledged its fault. Unless it appeals the decision, the central bank will release more details in 30 days.

The Bank of Lithuania took over consumer credit regulation functions in 2012. It has so far concluded 57 investigations into suspected violations, sanctioning companies in 51 cases.

Last December, regulators suspended the licence of 4finance, the biggest consumer loan issuer in the country, for repeated violations.

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