The petition
Friday the 13th of October 2006 is currently a day which will be remembered as the day Christmas 2006 was ripped from the hands of all Agents/customers of Farepak Food & Gifts Limited. Hundreds of thousands of people had saved faithfully each month (sometimes having to rob Peter to pay Paul) to ensure that Christmas would be taken care of by the delivery of hampers and shopping vouchers. As it stands at this point no hampers, no shopping vouchers - NOTHING - will be delivered as Farepak Food & Gifts Limited are now in receivership/administration.
In June 2006, European Home Retail Ltd (Farepak's parent company) advised that their funding would not last past the autumn and that they would be seeking additional funding. No customers of Farepak were given any warning about this.
23 August 2006 EHR's shares were suspended from trading on the Stock Market, again, no customers were given any warning yet Farepak's bank, HBOS (Halifax Bank of Scotland) allowed Farepak to continue trading pulling in at least £1million per week.
Mr Frank Field MP (Labour) states "If HBOS didn't know they were taking Xmas savings from poorer people, then they were either fools or knaves - let them choose which. A goodwill gesture now could clear the air rather than wait for the Department of Trade and Industry investigation,"
We therefore call upon HBOS to make good which they helped make so wrong on that fateful day of Friday 13th October 2006 and restore the savings that each customer made in good faith throughout the year.
This petition will be delivered to HBOS (snail and email) on 11 December 2006. If you support the fact that HBOS should return all customer payments in full, please sign below.
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The Story So Far...
Farepak Hampers began trading in 1969 from Westmead Drive, Westlea Swindon. In 2004 Farepak employed 130 staff and during hamper production an additional 150 temporary packers. By 2006 the number of employees had dropped to 20 with 75 additional temporary packers to be taken on at the Christmas period.
Farepak Hampers origins can be traced back as far as 1935. Bob Johnson was appointed Managing Director with 500 Agents of this small Christmas savings club in 1969 which operated out of a butchers shop in Peckham.
Kleeneze Homecare had been operating since 1923 (now Kleeneze UK) and was acquired by Farepak in 1995. Farepak changed its name to Kleeneze plc and at this time extracted the central part of their business to its subsidiary Farepak Food & Gifts Limited. Kleeneze plc changed its name to European Home Retail plc (EHR) in 2006.
On 30 June 2006 an announcement was posted on EHR’s website advising that their existing funding would not last past autumn and they would accordingly be seeking extra funding. The Hamper Industry Trade Association (HITA) of which Farepak were a member immediately contacted the Directors and were given assurances that the extra funding required would be forthcoming.
EHR’s shares were suspended from trading on the Stock Exchange on 23 August 2006. Again, HITA contacted the Directors and asked if Farepak customers’ payments would be ring-fenced, only to be advised that this was not necessary. Thereafter, on Friday 13 October 2006 Farepak Food & Gifts Limited, a subsidiary of European Retail Limited had an Administrator appointed following a rejection of a final proposal from their Bank, HBOS (Halifax Bank of Scotland). This led to the whole company, European Retail Limited being forced into Administration.
Farepak and other companies like it are a convenient way to save for Christmas by ordering your goods in the January and paying a weekly payment thereafter for 45 weeks. Customers could either deal direct with Farepak or become an Agent and secure their own client base who would normally be family, friends and work colleagues. In becoming an Agent they would receive a % of commission of their sales which could either be taken off their bill at the end of September, taken in goods or alternatively they could have a cheque sent to them. Farepak was developed originally as a traditional Christmas Hamper company and grew to be one of the largest Christmas saving schemes in the country. Thousands of customers used Farepak for their range of hampers, gifts and shopping vouchers.
As Farepak stated themselves “We use the experience and knowledge of our friendly staff to ensure that our Agents receive hampers that contain the best branded products and the freshest meats, at great value prices”.
Farepak further went on to state “As one of the founding members of the Hamper Industry Trade Association, we adhere to the HITA Code of Practice to ensure the security of your savings and the safe delivery of your hampers and gifts”.
As all Agents and customers of Farepak will now know the aforementioned statement was a false promise and Friday the 13th 2006 will almost certainly be remembered by thousands of people in Britain who had Christmas 2006 literally taken out of their hands.
Prior to 15 September 2003 far to much protection was given to secured creditors in particular that a Receiver could be appointed who would look out for the interests of the secured creditor only. With this in mind, the government passed the Enterprise Act 2002 which took effect on 15 September 2003. This Act was designed to give companies some breathing space and to delay or prevent liquidation (the death of the company). Accordingly, since the Enterprise Act 2002 Administrators are appointed and their duty it is to look at the company as a whole which is good news for unsecured creditors. Furthermore, the government withdrew themselves as a preferential creditor after the passing of the Enterprise Act 2002.
An Administrator is, as the word suggests, there to administer the affairs of the company. BDO Stoy Hayward have been appointed Administrators of Farepak Food & Gifts Limited. An Administrator must be a qualified or authorised insolvency practitioner. The powers of the Administrator are vast. They have the power to do whatever is necessary for the management of the company’s affairs, business or property. The can take possession and dispose of company’s property. They can remove and appoint directors and furthermore investigate the company’s affairs. The Administrator must give some indication as to how the company arrived the position it is now in.
Shortly after the administration order was made public, many people began to scour the internet for further information on what happened, and what could be done about the situation. To this end, a forum was set up at
http://www.unfairpak.co.uk/for... and there is certainly a wealth of information to be found there, along with a helpful a supportive community and practical advice on what to do.
Links
Visit
www.unfairpak.co.uk for more information and
www.unfairpak.co.uk/forum/ for advice and support
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