[an error occurred while processing this directive]
BBC News
watch One-Minute World News
Last Updated: Friday, 17 November 2006, 19:37 GMT
Farepak savers 'to get 4p in 1'
Catalogue detail from Farepak website
Farepak customers have been left shocked by the firm's collapse
Administrators of collapsed Christmas savings club Farepak have said clients may get back as little as 4 pence for every 1 they paid into the scheme.

Customers are unlikely to get any of the cash they are due until after the festive season, BDO Stoy Hayward said.

More than 150,000 people are thought to have lost about 35m when Swindon-based Farepak crashed last month.

While some clients had been saving for Christmas hampers, most had planned on getting vouchers to use in shops.


A customer who paid 500 into the scheme now faces being left with only 20.

"We have always said from the outset that people would receive a very small amount and it could be 4p or 5p in every 1 on current estimates," a BDO spokesman said.

"That is based on our current estimates on the number of customers that are involved and the value of Farepak's assets to be shared out."

A families fund for Farepak members is thought to have raised more than 4m in donations.

We were led to believe that a solvent solution was achievable
William Rollason
EHR chief executive

Retailers have weighed in with contributions, and HBOS, the banker of Farepak's parent company European Home Retail (EHR) has put forward 2m.

Farepak customers who paid with a credit card in instalments between 100 and 30,000 will be protected.


Shares in EHR were suspended on August 23 but Farepak continued to collect money from customers until mid October.

Speaking for the first time since the scandal broke, EHR chief executive William Rollason has defended his role in the collapse of Farepak.

In a statement to the BBC, he denied taking savers money knowing the firm was unlikely to survive

"We were led to believe that a solvent solution was achievable - and this remained the case even after the shares were suspended," he said.

"In the end this proved to be impossible, and we can only repeat that we are extremely sorry and disappointed with what has happened."

EHR chairman Sir Clive Thompson,has been heavily criticised, with Labour MP Jim Devine calling him "the unacceptable face of capitalism" and saying he was unworthy of his knighthood.

Sir Clive is currently enjoying a luxury holiday in Argentina and told the BBC that people should reserve judgement on him until a Department of Trade and Industry investigation was complete.

He has blamed HBOS for cancelling Farepak's overdraft facility.

Farepak customers gather outside the company depot

The BBC is not responsible for the content of external internet sites

Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit


Americas Africa Europe Middle East South Asia Asia Pacific