Unfairpak Forum - How Farepak Stole Christmas

On Friday 13th Oct 2006 - Farepak Hampers went into administration. Over 100,000 customers were told that no food hampers or vouchers or other goods will be supplied this Christmas as promised, and no refunds! Share your thoughts here...
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PostPosted: Wed Dec 13, 2006 10:52 pm 
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Quote from Shaun O'Riorden's letter.
"Our moral obligation, we believe, is to our customers"

One of my agency customers, who lost £600, has/had the following with Hbos.
Mortgage, Current Account, Personal Loan, Credit Card,
I would say, 'a good Hbos customer'
HOW HAVE YOU TREATED THIS CUSTOMER, SHAUN?

All accounts now being transfered to The Royal Bank of Scotland.

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PostPosted: Wed Dec 13, 2006 11:22 pm 
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Oh and did'nt Shaun go on about the financial risk to themselves with the EHR overdraft? With billions in profit ? Billions in profit versus 40 million overdraft? :-k Sorry if figures a bit out.

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PostPosted: Fri Jun 22, 2012 2:37 pm 
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Can everybody on Twitter please tweet this letter out? I am out of Country but HBOS need more 'exposure' :evil:

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PostPosted: Fri Jun 22, 2012 10:09 pm 
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Not on twitter I'm afraid but here is my edited copy of HBOS original letter, the Judges comments in red. :shock:

11th December, 2006


• HBOSplc
The Mound Edinburgh EH 1 1 YZ



- - -
AN OPEN LETTER TO THE UNFAIRPAKFORUM
Dear Ms Hall,
Thank you for contacting us about Farepak.


Direct Line Fax No


./


0131 243 7053 01312437082



I would like to assure you that we very much understand the financial hardship that Farepak customers are experiencing in the run up to Christmas. That is why we made by far the largest single donation to the Farepak Rescue Fund.
The Unfairpak Campaign
Vour campaign's online petition, which you have referred to in recent media interviews, contains a number of completely inaccurate and very misleading allegations.
To be absolutely clear. We did not claw back £1 m a week in Christmas savings from Farepak customers as you are alleging.

The deposits were therefore all charged to the bank, HBOS, as security for its loans.
As I have shown, HBOS, in accordance with its contractual entitlement, collected in £10 million for its benefit.


We did not even bank Farepak. Rather, we provided a loan facility to EHR, the relevant holding company.
The reality is that the debt outstanding to HBOS actually increased during EHR's and Farepak's most difficult financial period.


HBOS knew that those deposits would be paid and would be lost if their expected solution went out and that the only beneficiary of those deposits would be HBOS.

Banks provide loan facilities. They do not own or run companies.

the directors were concerned about the continued collection of these deposits and asked HBOS on at least two occasions in that period to allow them to protect future deposits in a trust, or more drastically to tell people not to give any more money. The bank refused both proposals.

Vou are, therefore, wrong in claiming HBOS was somehow responsible for what happened at FarepaK.

basically they were going to sit there -- -like stookies, doing nothing

ICis a fundamental business principle that the directors and owners of a company are responsible for the orderly management of its affairs. The buck stops there and nowhere else.
HBOS really ought to look at the collections that they took in September and October
The Farepak Response Fund
We were very disappointed with the position the Unfairpak Forum campaign took after we announced our £2m donation to the Farepak Response Fund - by far the largest contribution. At that time, you said our donation "absolutely disgusted" you.
We believe that your very negative stance may have discouraged other corporate contributors. Perhaps if you had issued a more gracious response following our donation, the fund would be significantly higher than it actually was when it closed.
We provided the largest single contribution to the Farepak Rescue fund. We did so even though we knew that making this donation might make some people think that we were somehow "culpable". We were prepared to take that risk - the observation is, of course, completely wrong - to get the fund moving.
The Public Know Better
The vast majority of people understand the fundamental distinction between a bank and the owners and managers of a business. That is why successive attempts by your campaign to encourage customers to withdraw their business from HBOS have had no impact.
We can count on one hand the number of customers who have said they may take their business away fromHBOS. The public - and our 23 million customers - know better.
Our Morai Obligation
Our moral obligation, we believe, is to our customers, shareholders and, where appropriate, the wider community. We have more than discharged that obligation. We really have gone the
extra mile. "
Banks hardlyever make~a- charitable -donation when a company that they have~provided finance to collapses. If banks were to make a significant contribution every time a company went into administration, then the UK banking system would be in a very sorry state.
Farepak is, however, a different set of circumstances to most corporate collapses. That is why we have broken the golden rule of banking. That is why we made the most significant financial contribution to the Farepak Fund. We did so because we do recognise the financial hardship Farepak customers are experiencing up and down the country.
To Sum Up
We made the largest single contribution to the Farepak Fund. We made this £2m donation because we recognise the real financial hardship that people are experiencing up and down the country.
I would ask you to remember that the facts must come first. Unfounded allegations help no one -least of all Farepak customers.
We call on you to set the record straight. No doubt you will also reflect carefully about the fact that some of your remarks may well have deterred companies from making contributions to the Farepak Response Fund.
Yours sincerely,
\...--........
-- \ ""
S<:/ \; j(/ fF> /
(~ 0, ~~{.J,Ul~
'~
Shane O'Riordain,
General Manager, Group Communications, HBOSplc

HBOS plc, Registered in Scotland No. SC218813. Registered Office: The Mound, Edinburgh EH1 1YZ. HBOS plc is a holding company, subsidiaries of which are authorised and regulated by the Financial Services Authority.

(edited a little by nommo to read easier)

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PostPosted: Sun Jun 24, 2012 2:24 pm 
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Remember I said on You Tube the "buck stopped with the DTI investigation ............." Think Mr Justice Peter Smith just 'stopped the buck with HBOS - now Lloyds' they had better listen !

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PostPosted: Fri Jul 06, 2012 5:31 pm 
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nommo wrote:
I think I can see what happened there.. did you scan it in and use OCR suzy? Was it 'multi-column' or something?

Anyway - onto the letter itself. Facts. I would like to know some facts (devoid of spin).

I have one and only one question.

Following the shares being suspended in EHR - how much has HBOS received back from EHR/Farepak/The Administrators?

Simple question. We know you are reading the forums... so go on - clear your good name.



Answer £10,251,000

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PostPosted: Fri Jul 06, 2012 5:37 pm 
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Have you all seen how many times this letter has been read?

HBOS really did do us a favour writing us such a detailed letter :mrgreen:

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PostPosted: Fri Jul 06, 2012 5:54 pm 
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what do you think of the news? i'm off to turkey tomorrow for 2 weeks, not taking my phone but might get net with my ipod. If v.c gets xmas savings included in banking reform, then you could call it a win....
If sir clive and chums sue for loss of earnings, then the gloss comes off.

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PostPosted: Sat Jul 07, 2012 2:19 pm 
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spongebob wrote:
what do you think of the news? i'm off to turkey tomorrow for 2 weeks, not taking my phone but might get net with my ipod. If v.c gets xmas savings included in banking reform, then you could call it a win....
If sir clive and chums sue for loss of earnings, then the gloss comes off.


Enjoy Turkey Bob!

I personally think it is a little, too late. Will just have to wait and see what Sir Clive and chums do!

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