5 February 2008
An investigation in to Egg's announcement that 161,000 of its customers will have their credit cards cancelled is unlikely, the Office of Fair Trading (OFT) said yesterday.
Around 7% of the credit card provider's customers face cancellation, following a review conducted by the firm.
However, speaking to the BBC, an OFT spokesperson said that no official complaint had been made about the move - and therefore no investigation will be launched as yet.
Industry regulator the Financial Services Authority also said that such an inquiry was outside their remit.
Egg launched the risk review of its customers after it was taken over by the US bank Citigroup last year in a £575 million deal.
However, despite the provider's suggestions to the contrary, it appears that not all of the cardholders culled represent a credit risk to Egg.
Some say that they have paid their balances off every month prior to their receiving notification of the cancellation.
Accordingly, Egg has been accused of administering the cut-off to increase profits - as those who pay their balances off pay less interest on their cards and therefore make their provider less money.
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