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Last Updated: Monday, 19 November 2007, 10:30 GMT
Farepak victims miss festive cash
Catalogue detail from Farepak website
The firm's collapse brought heartache for many last year
People owed money after the collapse of Farepak will not see any cash before Christmas, the BBC has learned.

About 120,000 victims are expected to eventually receive about 5p for every 1 lost but it is still "early days", the firm's liquidators have said.

The "unprecedented number" of claimants has been partly blamed for the delay in salvaging any cash.

About 40m was lost when the savings club went into administration in October 2006.

Customers of Farepak, owned by European Home Retail (EHR), paid money monthly to the company as a practical way to put cash aside for Christmas - receiving hampers and vouchers to use in shops.

However, the company collapsed in October last year.

'Social injustice'

Separately, a report by Unison has suggested that low-paid women who suffered from the collapse were forced into a "cycle of debt"

Feelings of "anger, anxiety and depression" were found among savers who lost money, it said.

University of Birmingham researchers found that many had been forced to borrow from relatives or had taken out loans after losing money.

Director of the Centre for Crime and Justice Studies, Richard Garside, said that many victims felt they had been neglected.

"Many are asking why, if the government was prepared to underwrite Northern Rock to the tune of billions of pounds, no comprehensive help has been forthcoming," he said.

"As it is, a significant source of social injustice remains hidden and unaddressed by the government and the financial authorities. Without concerted action other Farepaks are inevitable."

A Department of Business and Enterprise spokesman said that a Family Fund it had set up had distributed about 8m to victims and that its investigations would ensure anyone who acted improperly was held to account.

He added that a number of steps - including putting in place protection for customers' prepayments - had already been taken.

"The collapse of Farepak last Christmas was appalling and we have acted to ensure that nothing similar could happen again," the spokesman said.

SEE ALSO
No timetable for Farepak refunds
13 Oct 07 |  Business
Probe into Farepak's accountants
04 Jun 07 |  Business
Advice to prevent Farepak repeat
01 Jun 07 |  Business
Protection for hamper scheme cash
28 Mar 07 |  Business
Farepak 'faces claims worth 38m'
19 Jan 07 |  Business

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