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: Thu Nov 08, 2012 9:40 pm 
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Had the Telegraph on the phone. Apparently the Co-operative are starting a Christmas savings club with all money ring-fenced. I personally think this is great news and hopefully they will join the CPA! Apparently FVC have been working with them so kudos to them. Hope other companies follow suit!

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PostPosted: Thu Nov 08, 2012 9:54 pm 
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suzy wrote:
Had the Telegraph on the phone. Apparently the Co-operative are starting a Christmas savings club with all money ring-fenced. I personally think this is great news and hopefully they will join the CPA! Apparently FVC have been working with them so kudos to them. Hope other companies follow suit!


Ah, thats great news to hear! :)


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PostPosted: Thu Nov 08, 2012 9:56 pm 
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Angie Plant wrote:
suzy wrote:
Had the Telegraph on the phone. Apparently the Co-operative are starting a Christmas savings club with all money ring-fenced. I personally think this is great news and hopefully they will join the CPA! Apparently FVC have been working with them so kudos to them. Hope other companies follow suit!


Ah, thats great news to hear! :)


It is really great news :)

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PostPosted: Fri Nov 09, 2012 9:36 am 
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Co-op to launch first protected Christmas clubCo-op saving scheme to boost consumer protection

09 November 2012




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The Co-operative Group is to become the first major UK retailer to launch a Christmas savings scheme which provides greater protection for consumers' money.

Because Christmas clubs are not regulated, they are not covered by the Financial Services Compensation Scheme (FSCS). This means that, should the worst happen and the company goes bust, consumers could stand to lose some or all their money. They also won't be able to turn to the Financial Ombudsman Service (FOS) for help if they can't resolve a complaint with the company directly.

To provide consumers with greater protection, the Co-operative is to set up a trust structure to protect savers' money. Full details of the Co-op scheme won't be revealed until it is launched in the New Year, but the development of the trust has been backed by the Farepak Victims Committee, which was set up after the Christmas club collapsed in 2006 resulting in nearly 120,000 people losing, on average, about £400 each.

Co-op will 'set a standard' for other Christmas savings schemes

Thousands of Co-op customers already save for Christmas by buying £1 stamps during the year, which they can then cash in when they do their festive shopping. Shoppers who buy stamps before the new scheme comes into effect will be able to redeem them as normal but won't be covered by the new scheme.

Speaking about the new protection, the Co-operative Group's Martyn Wates said: 'Our pioneering approach will give our customers added peace of mind and will set a standard for other businesses to follow.'

Deb Harvey, secretary of the Farepak Victims Committee, said: 'We are overjoyed at the announcement. We have been campaigning for six years because, as former customers and agents, we know only too well of the heartache caused by the Farepak collapse. This is a massive step in the right direction and demonstrates how The Co-operative is putting the customer at the heart of its business.'

Great that the Co-operative have done this! However, members of CPA have the added protection of FSCS now also. Wish that fact that been put out.

Hope other companies follow the lead and start thinking about protecting pre-payment schemes!

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PostPosted: Fri Nov 09, 2012 10:27 am 
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Greater protection now available for Christmas Club customers after FSCS intervention



Christmas Prepayment Association members extend consumer protection to cover a banking failure



The Christmas Prepayment Association (CPA), the self-regulatory trade association for the Christmas savings industry, has strengthened its terms and conditions to maximise the safety of their savers’ money. The move comes after the Financial Services Compensation Scheme (FSCS) proposed a number of changes to the CPA.



Christmas Clubs are not regulated by the Financial Services Authority and so do not come under the direct remit of FSCS. However FSCS can protect the Clubs’ funds in some circumstances, including if the financial institution holding the money fails but the Christmas Club provider continues to operate. Following an approach by FSCS in January the CPA has amended its Code of Practice to ensure that customers’ payments are placed with an FSA-authorised institution and clearly identified against the relevant individual. This means that in the event of a bank failure FSCS will be able to return the money so it can be used to fulfil their order.



The enhanced protection applies to schemes run by Country Christmas Savings Ltd, Family Christmas Savings Ltd, Park Christmas Savings Ltd, Flexesaver Ltd and Variety Christmas Club Ltd. Letters have now gone out to customers informing them of the changes. Banking deposits with the Post Office Christmas Savings Club, the sixth and final CPA member, are already covered by the Irish Deposit Guarantee Scheme.



Mark Neale, Chief Executive of the FSCS, said: “Although Christmas Clubs are not covered by FSCS we saw that a number of simple steps could be taken to improve the protection available for people who save with such schemes. We approached the CPA and are delighted they have accepted our suggestions to ensure that all customer funds are kept in FSA-authorised accounts, with individual amounts clearly identified. In the event of a bank failure, the customers of CPA members can be sure their money is safe.



“Customers should be fully aware of the risks associated with every product, including Christmas Clubs, before taking one out. They can check whether FSCS protection will be available by visiting our website or asking the provider. In these tough times, consumers can have peace of mind by knowing that FSCS will be there for them if they need it.”



Derek Walpole, Chairman of the Christmas Prepayment Association, commented: “Our members’ Christmas Clubs provide a service that hundreds of thousands of people find useful and convenient. They allow hard-working families to put aside some of their money to save for presents so they can enjoy Christmas. We want to do everything we can to protect our customers and so are delighted to tighten our code of conduct to do this.”



FSCS protects consumers if banks, building societies or credit unions go bust. Since 2001, it has helped more than 4.5 million people and paid out more than £26 billion. It covers the full range of financial services.

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PostPosted: Fri Nov 09, 2012 10:35 am 
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http://www.telegraph.co.uk/finance/news ... -cash.html


Co-op's Christmas savers scheme 'will ring-fence cash'
The Co-operative Group is to launch a Christmas savings scheme trust, offering consumers greater protection following the collapse of savings club Farepak six years ago.

The Co-operative Group is "underlining its care for communities" by opening a new Christmas savings trust. Photo: The Co-Operative
By Louisa Peacock
6:55AM GMT 09 Nov 2012
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The group said it had been approached by the Farepak Victims Committee to open a new trust that would ring-fence savers’ money and keep it protected.

Swindon-based Farepak collapsed in 2006, but its saving scheme was unprotected leaving 114,000 people with total losses of £37m, averaging hundreds of pounds each.

Martyn Wates, deputy group chief executive of The Co-operative Group, said: “The memory and impact of Farepak’s demise is still felt by many households within the UK.

“Members of the Farepak Victims Committee have, to their enormous credit, kept the issue of consumer protection alive and I am delighted that, as the UK’s biggest consumer-owned business, we have been able to respond in this way.”

A Co-op spokesman said the group was only approached by the Committee “a few weeks ago”, but he confirmed the money would be ring-fenced in a separate “banking facility”, although the details are still to be worked out. The scheme will launch in January.

Deb Harvey, secretary of the Farepak Victims Committee, said: "By putting this new scheme in place, The Co-operative Group really is underlining its care for communities."

Suzy Hall, national coordinator for a separate campaign group, Unfairpak, welcomed the Co-op’s scheme, adding it may help put pressure on other companies, such as supermarkets, to ring-fence their savings schemes.

"It's fantastic the Co-op have done this. I hope with the Co-op doing this, it will help other companies to follow suit. The supermarket schemes are still not protected."

Ms Hall, also director of consumer affairs at the Christmas Pre-payments Association, which includes the Post Office, invited the Co-op to join the CPA as further proof they are serious about consumer protection.

The Co-op spokesman said the group wouldn’t rule out the possibility of joining the CPA "if we thought that by doing this we would help move things even further forward in this area."

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PostPosted: Fri Nov 09, 2012 10:47 am 
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suzy wrote:
Ms Hall, also director of consumer affairs at the Christmas Pre-payments Association, which includes the Post Office, invited the Co-op to join the CPA as further proof they are serious about consumer protection.

The Co-op spokesman said the group wouldn’t rule out the possibility of joining the CPA "if we thought that by doing this we would help move things even further forward in this area."


Good to see that they have not ruled out the possibility of joining the CPA as I firmly do believe it would help improve things even further in this area. Well done Co-op =D> =D> =D>

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PostPosted: Fri Nov 09, 2012 11:43 am 
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suzy wrote:
Great that the Co-operative have done this! However, members of CPA have the added protection of FSCS now also. Wish that fact that been put out.

Hope other companies follow the lead and start thinking about protecting pre-payment schemes!

Agreed, CPA still has that extra layer of protection.

suzy wrote:
Good to see that they have not ruled out the possibility of joining the CPA as I firmly do believe it would help improve things even further in this area. Well done Co-op =D> =D> =D>

Suzy, would it be correct to say the Co-op will be self-regulated?


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PostPosted: Fri Nov 09, 2012 12:17 pm 
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Angie, I think it would be fair to say that yes.

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