04/11/2013 Newsnight


With Kirsty Wark. Payday loans, the latest on the phone hacking trial, face scanning at the supermarket and the scientist who says LSD is safer than tobacco.

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Britain's most controversial business, Wonga, the payday loan


company, they have become a byword for easy money at crippling interest


rates. They don't like it. The idea we charge thousands of per cent


interest is a myth. Their Chief Operating Officer is here to explain


why all the negative press is wrong. And this. The radical feminist


group, Femen coming to a protest near you. First the clubcard, now


Tesco has a face-scanner, it will check your sex and age range to give


you tailor-made adverts. Innocuous check your sex and age range to give


profits out of people's financial pain is the accusation. But now one


of the most prominent, Wonga, are on a charm offensive. Tomorrow they


launch a Wonga-made movie featuring ten happy customers for whom fast


money, they say, has been the answer to their prayers. I will speak to


senior Wonga executive after this. I love cutting children's hair, they


enjoy having their haircut in nursery... They are the voices of


Wonga, according to none other than Wonga. Tomorrow the company will


release a film imaginatively titled, Wonga the Movie, they feature people


who have taken out loans and repaid them. We have been together three


years, last year I asked her to marry me. My


years, last year I asked her to out of money on a Friday night all


you need is a smartphone and it can be in your account in five minutes.


That allows some to dig themselves deeper into debt. You see them


advertising, so easy to get. You go on-line and state how much you want.


You don't notice how much interest you are paying back. I think the


interest rate should definitely be capped. It is an awful lot of money


they ask you for. Wonga's transparency makes it easy prey to


seizing on to the high interest rates. It is as much as 1,000%.


Wonga say customers don't pay that, they will by 1% day or 365% a year.


All too tempting say critics for under-18s. They all claim to lend to


them and Wonga say they are not like the other payday lenders, they need


to come clean the other payday lenders, they need


out of control. A million customers want this instant credit because


they can't get it from bank. Wonga says eight out of ten applicants for


a first loan are turned down. It is a question of whether the movie will


be enough to outshout the crickets. Joining me now is the Chief


Operating Officer of Wonga. First of all, did you realise your


image was so bad you had to make your own movie? Today we are


announcing a movie called 12 Portraits, and the director is


trying to dispel some of the that our image, that you refer to, has


out there in the UK. I think if you look at the movie, what you will see


is a representation of our customer base, 12 portraits, in fact,


representing a million active customers, you can make up your own


representing a million active was paid their money back on term


quickly. That is not the case for your customers? Gary first of all


had complete editorial independence over what he made. Chose the


customers himself. We gave him a database, selected them. We have a


million active customers. Can I just take you back on that, free hand, he


who pays the piper plays the tune, that is first of all, if Gary Tarn


had produced a film that showed somebody defaulting on their Wonga


loan having perhaps to pay 375% credit, getting another loan to pay


off a Wonga loan, destitute on the Pavement, would you be happy for


that to be on the film? There are 12 portraits and one has defaulted. If


you look at interest on fees on our site on Wonga, included with one of


those is site on Wonga, included with one of


the voice of the silent majority, the people who use the service is


not being heard. The trouble is if you present too rosy a picture it


Encourages people to take out that loan. This is Liz Matthew this is


what happened to her. I got into a vicious cycle where I had four loans


and couldn't pay any of them back. How much was the original loan? The


original was ?300 and I owe now ?2,000. I was very frightened and


worried thinking how can I pay it back. You can't sleep at night. Now,


Liz Matthews she had a first Wonga loan and a second one. What were the


affordability checks. You say you do them but she got herself into


terrible trouble? I can't comment them but she got herself into


second was ?400 and then she got into trouble. The thing is with Liz


Matthews you don't require any documents as proof of what they say


is true?. We look at 8,000 thesis -- pieces of data. We look at how they


navigate up to the website, if they slide up to the right they may not


pay us back. Is it an on-line service? It is. That check can be


made quickly. In five minutes? We mustn't confuse speed with accuracy.


I was going to say the thing about Liz Matthews, I spoke to her today


and she admitted to me that she had put down that she was employed on


both occasions. And she wasn't employed. OK. So therefore she


received money You have no way of checking that? We


have a lot of ways of checking that Kirsty. Not with her? Liz may be a


case that I don't right now have the details in front of me. What we're


here to talk about is that there are a million customers of whom the


vast, vast majority are happy, and their voice has not been heard. And


they are being misrepresented as people who are like Liz as all poor


and vulnerable and getting themselves into a spiral of debt.


That is simply not true. It is the case that about seven. 5% either


have rollovers that cost a lot of money -- 75% either have rollovers


that cost them a lot of money. Those people are often desperate and will


say things to get money when they can ill-afford to pay it back? I


would not agree they are desperate. The reason I'm actually here and


sitting here and made that film is because I


sitting here and made that film is and hops of thousands of others, the


second thing I'm surprised about is the reaction of the media and other


commentators calling out the exceptions like Liz and assuming


everyone is like that. When we talk about seven. 5% rollovers and


defaults that is substantial. Are you confident that customers know


exactly the consequences of taking out a Wonga loan? I'm very confident


that we show everything as clearly and transparently as we possibly


can. The price is marked very clearly on the sliders, the terms


under which people borrow from us are marked very, very clearly. The


fact that 90% of customers would recommend us to a friend is evidence


they agree with us. Talking about the implication, I want you to


explain this, this the implication, I want you to


months, lenders will immediately automatically reject the


application, or ask lots of questions about why that person can


afford a mortgage now when they were clearly living from hand-to-mouth


recently. In order to address that problem, because people don't


appreciate the issues, I think it would be very sensible if payday


loan lenders were required by the regulator to state on all their


literature that taking out a payday loan may prejudice your ability to


get a mortgage. That is a senior mortgage broker. And even if your


customers are happy and pay back, the very issue of taking out a Wonga


loan may impact on your ability to get a good mortgage? I can't comment


on other financial institutions' policies, the regulator will decide


if that is a right response. He's a senior mortgage broker, he will say


in terms of credit rating if you wake a Wonga loan you


in terms of credit rating if you with this, it is about transparency,


you claim that Wonga is transparent. It is a fact that if you take out a


loan from a payday loan company, when you go to put your mortgage


application in, and goodness me Help To Buy is tough enough, that it may


impact on your ability to get a good mortgage. It would be very simple to


put that rider on your website, why don't you do it? Because, as I have


explained, I don't know that is the policy of every single financial


institution, as your colleague there says, or as your interviewee says,


if the regulator thinks that is an appropriate thing to do they will do


that. We are going through with the FT reviewing our business and the


FCA the same. I'm sure they will tighten up practices across the


whole of the industry and deal with those things as necessary. This is


interesting, the regulator is looking at you, we say you


interesting, the regulator is there, that we could do or others


could do depending on their opinion. What we see is there is a huge


Misper exception over the myths about Wonga out there. We are trying


to show that actually that silent majority of people who haven't been


heard and commentators who haven't taken and borrowed money for a week


or ten days, are making commentary about our customers, we think that


is very unfair. That is not commentary about your customer, what


this mortgage broker is saying the evidence of having payday loan could


impact on the chances of getting a decent mortgage. If you go and check


that tomorrow, and that proves to be true, put it on your website now?


Kirsty, as I said, two or three times now, I don't know what the


financial institutions' policies are. Will you find out


financial institutions' policies about mis s about -- miss


Perceptions about customer, it may affect something in their future


life and they are poor and vulnerable, the evidence I see is it


is not the case in the majority of cases. We have looked at our


customer base and invited a vulnerable person to exam that. I'm


not suggesting that vulnerable people should be told that it might


be difficult to get a good mortgage, I'm saying that anybody who takes


out a payday loan, who rents a wonderful house and may have to buy


may be impacted by a payday loan. Not people who are destitute, people


looking for a mortgage. If it is the case if you check what that


gentleman says tomorrow morning and find it to be true, in the pursuit


of transpornly will you put it on find it to be true, in the pursuit


for 17 days, it is not exactly a very long period of time. If they


don't pay that back, of course that may impact their underlying credit


rating. And what we think is... Even if they pay it back it will impact,


that is what I'm saying. This was a senior Kensington mortgage brokers,


a senior figure in the industry saying it is not whether you pay it


back on time it is the fact they had payday loan? I ups that, there are


many other commentaries on our business, such the price you


referred to in the introduction, which are myths. We want people to


understand that we are sharing all of our statistics and have a look at


the film, our product is fair and transparent, and those customers are


intelligent people, who in my opinion represent the average person


in the UK. opinion represent the average person


is the maxim that Andy Coulson is conducting his defence case. While


his co-defendants chose to remain silent as the prosecution finished


outlining his case. Coulson instructed counsel to deliver an


opening statement, insisting he was never part of an agreement to hack


phones, no matter what others were doing on his watch at the News of


the World. This report contains flash photography.


If the paper he had once edited was still around to report Coulson's


trial, it might have come up with a headline like this. This wasn't Andy


Coulson in the centre but his council, Timothy Langdale, who broke


with normal procedure and made a speech to the jury, before the


prosecution had even presented its case. Mr Langer Langdale said he was


Far from being complicit in phone because he wanted to


Far from being complicit in phone hacking, Mr Langdale told the jury


that Andy Coulson had had his phone hacked by the private investigator,


Glenn Mulcaire. As for the evidence so far suggested


by the prosecution that Andy Coulson must have known what his reporters


were allegedly up to. It was said that as editor he faced a blizzard


of e-mails and couldn't possibly know the source for every story


appearing in the news of the world. In any sense,


appearing in the news of the world. evidence, Andy Coulson said that


anyone at the News of the World had deleted the message. Something the


prosecution has already agreed. There was talk about Prax Blackhawk,


the alleged conspiracy between Rebekah Brooks and Charley Brook and


Mark Hanna, to conspire to hide information from the police.


Andy Coulson told the police that Rebekah Brooks would be next and if


she was arrested they would have powers to search her houses. On the


day that Rebekah Brooks was arrested the police were told staff who were


working for her removed a back from her Oxfordshire home and taken to a


London home. As the bag was dropped, a member of her security staff


texted a colleague It was alleged today that Mrs Brooks


instructed her PA, Cheryl Carter, to remove seven boxes of Mrs Brooks's


notebooks from the News International archive. The notebooks


have never been seen again. All the defendants deny the charges, the


prosecution continues with its case tomorrow. The feminist protest


group, Femen, founded in Ukraine and head quartered in France where it


has its largest membership has announced it is setting up in


Britain. The movement's trade mark is the topless ambush, protests


against dictatorships and religion, they have a record of high-profile


actions, including they have a record of high-profile


it becomes a strength. Our body becomes our weapon. It is a naked


warrior. They call themselves sex-tremists, they rage against


patriarchy, religion, homophobia and authoritarianism. They are offensive


wherever they go. Femen have upset Christians, Muslims and models. But


not Vladimir Putin! They say it is war. It looks like theatre. So where


better for Femen to base themselves than France. The home of street


protest, revolution and a topless lady liberty. I have come to Femen's


European headquarters here in Paris, it is also where they have their


boot camp. Where they train up their it is also where they have their


morally. Definitely you can't do such actions like we do, attacking


Putin or climbing up on the top of a building in Davos on the economic


forum where all the leaders of the Government are inside, you have to


be well prepared. Inna Shevchenko is Femen's leader. She fled Kiev after


taking a chainsaw to a crucifix, she said it was in support of Pussy


Riot's protest against the Russian Orthodox Church. It won her many


enemies, it had been a cross in memory of some of Stalin's victims.


In France she has been given asylum from arrest. Femen say they are


redefining nudity, breasts will not hear our slogans.


In this exercise they are role playing a confrontation with the


police, Femen are now fighting in nine countries. Gisela Perez is from


Mexico. When I say naked war, when I tell my Government that they are


dictator, when I tell them that I do not agree with them I stop becoming,


I have a political will, that we go to prison for that.


So where does Femen fit into the story of feminism. They are hardly


the first feminists to be vilified. Mary Wolstencrft was called a high


Ena, Mary Wolstencrft was called a high


everything that has gone before. We are continuing something other women


started before. What doesn't help is the revelation that Femen was set up


by a man. The accusation is there are man's fantasy of what feminism


should look like. When Femen bare their breasts are they really


challenging the system or conforming to it? They say they are against the


sexualisation and objectcation of women, but when they take their tops


off, a lot of people look at them and think they look like sex objects


and they have become the stereotype. Do you want to look sexy? Exactly,


we are using what they made us and we're turning it against them. If


you want I could say that Femen activists are like forcing Barbie to


fight. Our Barbie "lock you lock you what"? Femen have


tried to alie themselves with the women of the Arab Spring, but many


think they are Islam phobic. Do you worry that you cause distress and


people are alarmed at what you do? This is also the aim of activism. It


is to make people react and realise things. To create a sparkle in


people's minds. We are not against Islam specifically, we are against


all religions, all the institutions. But can these arguments ever get


through? When their tactics are so uncompromising, is anyone listening


above the shouting? When I'm waking up a spend two to read some news,


and I read and I check what happened during the last 24 hours, maybe 60%


of all that during the last 24 hours, maybe 60%


I think that's enough to ask why we do what we do. Femen are now


recruiting in the UK, they haven't ruled out breaking into Buckingham


Palace, and yes, taking their tops off in front of the Queen.


The founder of a new tracking device has described it like the sci-fi


movie Minority Report in which Tom Cruise's eyes are screened and


advertising is tailored to his profile. That film was out in 2002


and the future is here. At least on 450 Tesco petrol forecourts, soon as


you wait at the till your face will be scanned for genteder and age, and


hey presto different ads will appear depending on your data. What if you


think it is one more invasion of your privacy and you have to stick


think it is one more invasion of scanners which recognise his


features. Now that technology is all but here. As our frame-by-frame


homage makes clear. Now we're all about consumer


technology on this programme, goodness knows, and yet, there are


grounds for scepticism, the idea that this scanner could look into my


eyes and say anything conclusive at all, based on my weekly shop of Pot


Noodles and alco-pop, it is a bit far fetched. But is it though. These


shoppers are profiled, divided by gender and into age groups. One


major gender and into age groups. One


information you put out there. Advertisers will want to use that.


It is out there for them to play with. In France they are already


exploiting the information we put out there. Monitors read your store


loyalty cards, this triggers localised advertising, personalised


messages, instantly sent to hoardings as you pass them. It is


only a trial so far. Does that sound irritating to you, even the people


behind it think so. Maybe you buy milk and we can identify if you need


milk. It is really annoying, but it is the


future, and you can't miss this. It is really annoying, but it is the


consumers want and will put up with. More people said they would stop


transacting or doing business with a company if they thought it was


harvesting their data without their permission and selling it on to


other third parties. They put that ahead of things like environmental


damage or huge fat cat salaries. So it cull is something that makes


people very anxious. Again I think it is because this sort of sense of


things being done behind my back, with my information that really


upsets people. Any other objections? Form an orderly queue. It is when we


think personal relationships turn into state power relationships. We


have a really serious problem. It has already happened in a number of


countries with mobile data. The Government in this


retailers and others rely on us not noticing or shrugging and looking


the other way. In the supermarket of the blind, the one-eyed man is king.


I'm joined now by the man behind Tesco Crabcard, he runs -- Tesco


Clubcard, he runs a company that brings better information to


advertisers. We will come on to social media in a little while.


Let's deal with the forecourt issue. It is simply on the question of one


of three age brackets and gender, what is the problem? It teaters on


the brink of unethical. The issue is do you want this to happen to you?


And have you given your permission for that to happen to you? Your


personal image is personal information, it is being


personal image is personal think it would be possible, if I'm


approaching the till in Tescos and I don't want that to happen I have the


right to say please switch that off? Yes, ideally you would have the


right to say that in advance. Before you even get there? How will it


actually work? We had in-store television five years ago.


Interestingly customers didn't like it and we turned it off. You don't


work for Tesco's now? No. I think Anna is right it is about consent.


You don't approve of this? I'm not saying that, I don't think it has


been thought through fully in terms of actually thinking what customers


want rather than what you can do. Technology enables so many things to


be done, just because you can do it, should you do it? The idea of


targeting advertising at the petrol pump based on the make of car you


turn up in, for pump based on the make of car you


is not. Absolutely not. You can from the face you give your credit card


to that till, you have a number plate in the car, you can profile


that person exactly. Three pieces of information can tell a lot about


that person. And it is not acceptable and it is completely out


of proportion. Let's look at on-line now then and using social media


better to tailor your interest in certain goods. This is very much


Clive's territory. Do you approve of that? Well personally I don't


approve of that. I think if people say yes, you can do that to me,


that's fine. The problem is that profiling is a default option.


People are profiled unless they opt out. They usually don't. It is


normal behaviour. You use Twitter data, would people


normal behaviour. You use Twitter is your choice. You bare your soul,


you have to be prepared to give up everything? You don't have to give


up everything at all. You can choose if you wish to not opt in, you can


choose if you want to, it is a consent-based model. I think it is


about the consumer having control. It always has been. They are the


successful businesses. The problem is we don't have control, there is a


lot of evidence that we do not have it. People are getting profiled


without knowing what's happening to them. They are at the moment, of


course? How do you, you presumably do have a mobile phone. I do. Your


phone company knows where you are at any moment in time, will that be the


find of information to second guess what you are going to do and what


you might buy next? Geolocation data is very sensitive data. The


companies that have not selling your perm data, they are


selling aggregate statistics to help the retailers understand the foot


fall. In ten years time you will identify somebody, the Iris and the


passport, identifying someone on the street with a camera? You could do


that today, and the question is are you responsible. That is the asset


test. I think the legislation we have is far behind what technology


can do. Thank you very much indeed. The leading British scientist, was


ejected from his job as chairman of the Government's advisory council on


the Ms. Use of drugs four years ago has been warned an international


prize for standing up for science. It is given by nature -- Nature


Magazine, for standing up in the face of hostility and


Magazine, for standing up in the gained the prize, this is our


science editor first. When science meets politics it can be a classic


clash of culture, how the Government deals with legal highs has been one


such flash point since the summer. When the Government announced a ban


on the herbal stimulate Cat, against scientific advice.


In the past politicians have traditionally turned to science most


especially in times of war. Though it was Winston Churchill who


famously said scientific advisers should be on tap not on top. Many


scientists believe that going along with that view would be too meek and


science advice is more than setting out the spectrum of views, but


making sure that policy is based on the best balance of evidence. Not


just in war but across a whole range of pressing and


to climate change. Professor David Nutt was made chairman of the


advisory council on the misuse of drugs, he had a number of run-ins


with politicians, and in 2009 he compared using ecstacy with horse


riding, he was then sacked by the Home Secretary Alan Johnson, after


saying Government classification of cannabis was at odds with scientific


measures of actual harm. Professor Colin Blakemore was one of the


judges for today's award and has worked with Professor Nutt in the


past. He said the whole fair had lasting impact, a set of principles


on the way scientific advice should be troted. Science underpins


everything we do, increasingly so. Everything from what you mobile


phone you choose to whether we are going to tackle global warming.


Increasingly the going to tackle global warming.


important is that the clarity of high-quality scientific advice is


available to everybody. This woman advising Alan Johnson at


the Home Office at the time of the David Nutt row. He thinks Churchill


got it right? Scientists have a high regard for themselves and those on


Government committees have higher regard for themselves. Our


experience under the last Labour Government was give the advice by


all means, but don't think because you have given the advice that


Government has to accept it. And if Government doesn't accept it for


whatever reason, that doesn't mean it is a challenge to your authority.


It doesn't mean you are undermined, all it means is thanks for what you


have advised but in this case no thanks. But many Government advisers


feel their first duty is to speak out to the tax-payers whose cash


often funds scientific research, not the politician


often funds scientific research, not you sacked? I do, since then I have


realised there is greater problems as a result of some of the failure


to be logical about drugs. Particularly it has been clear in


the last few years how medical research is impeded by the drug


laws. The laws we put in place to stop people using drugs are stopping


scientists using drugs and developing new treatments. Would you


say it in the same way as you said in 2009 or would you be judicious.


We haven't moved on, I think I would be more forthright. We have mored


backwards -- moved backwards. Do you accept that there has to be a


calibration by politics in terms of what you say, they have to take into


t Times of drug abuse and the politics essentially? I would say if


you have good scientific evidence and a policy is not working


you have good scientific evidence harmful than LSD, would you


decriminalise it? I'm not about that, it is about a more equal


playing field to the drugs we suffer from, alcohol and tobacco. You


wouldn't decriminalise Dan business? I certainly would. What about


ecstacy? Any drugs less harmful than alcohol should be decriminalised. So


LSD? I would decriminalise it, as well. I don't think that


criminalising people using drugs is any use at all. As we have seen from


other countries where we have seen benefits decriminalisation. The


herbal CAT is a controversial one? The banning of Cat is a ridiculous


one. It does terrible damage? It does no damage. We only banned it


because the Americans have does no damage. We only banned it


pricing, the way that they treat alcohol, what has gone wrong? They


just basically lost courage at the last minute. They started off making


the right statement, minimum pricing, it will work and reduce


harms to particularly heavy users and then probably due to pressure


from the drinks industry they backed off. Do you think that will have


long-term damage? Of course it will, alcohol is the leading cause of


death in men in this country between t ages of 16-54, minimum pricing


would have reduced deaths by 25%. Let's talk about cigarettes,


originally there was plan to clear all branding, to clear all


advertising from packets, that has now changed? That would have worked


and the Australian experience says that is working you take away the


glamour of the cigarette. Here are the two things you think are big


killers, the two things you think are big


are looking at are simplistic ways of appealing to the population and


voters. Voters know they are wrong. If the voters knew they were wrong


the voters would do the right things themselves they would take less


alcohol and smoke fewer cigarettes? They are doing that to some


excellent. Let's be clear, every taxpayer pays ?1,000 in tax every


year simply to allow us service the level of drinking through health


services and policing. There is an enormous tax burden on people


because we don't have minimum pricing. The on the other hand


people would say free will and make up your on mind, and what you are


saying is patronising for people who should be able to decide for


themselves? The whole thing about drinking alcohol is to take away


your self-control. That is not the only reason? It is one of the


the scientists and the Government not getting the message across, you


are out of Government now, and the scientists in Government are they


supine? I think that Government scientists are in a difficult


position, because mostly they don't get listened to. Are they being


supine or risk their jobs? I don't see anyone being as forceful as I


was. Thanks all for tonight, Emily is here tomorrow. We leave you with


a Berlin singing Bronski Boy when a passer-by felt he could do it


better. # Turn away


# Run away. # Run away


# Turn away # Run away


# Turn # Run away


# Crying to


With Kirsty Wark. Grilling one of the bosses at Wonga, the latest on the phone hacking trial, the topless protestors, face scanning in Tesco and the scientist who says LSD is safer than tobacco.

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