Police will not bring any criminal charges against payday lender Wonga over the ‘fake firms’ scandal that has cost it millions of pounds.

The company was ordered to pay £2.6m in compensation last summer to around 45,000 customers who had received letters apparently from law firms.

Financial Conduct Authority investigators found letters were sent to customers under the names ‘Chainey, D’Amato & Shannon’ and ‘Barker and Lowe Legal Recoveries’. Neither firm existed.

The matter was referred to the City of London Police, but its economic crime team today confirmed no further action will be taken.

The police statement says: ‘The central allegations were that Wonga had deceived its customers by sending letters falsely purporting to be from lawyers with the aim of recovering outstanding debts from customers.

‘After a thorough review of all the material gathered the City of London Police has concluded there is not sufficient evidence to progress a criminal investigation.’

The issue came to light in 2012 when the Office of Fair Trading met with the City police force to consider an investigation into Wonga’s debt-collection practices. The decision taken at that time was the most appropriate course of action was for the OFT to continue its own investigation.

In April 2014 the OFT closed and the FCA, which had taken on the regulatory responsibility regarding consumer credit, entered into discussions with Wonga and secured compensation for the customers affected.

Once this matter was concluded the City of London Police agreed it was in the interests of the public to review further material that had been obtained both during the FCA discussions and after the original OFT referral in 2012 to assess whether a criminal investigation was now viable.

By November, Wonga said 25,000 customers had been contacted, with the vast majority accepting the compensation offer.