UK Government urged to help Farepak victims

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By a Newsnet reporter 
 
UK Business Secretary Vince Cable has been urged to show that there is substance behind David Cameron’s rhetoric on ‘moral capitalism’ by helping Farepak victims obtain compensation.
 
The calls followed comments from the senior Lib Dem MP in which he announced plans to tackle excessive pay awards for company executives.

By a Newsnet reporter 
 
UK Business Secretary Vince Cable has been urged to show that there is substance behind David Cameron’s rhetoric on ‘moral capitalism’ by helping Farepak victims obtain compensation.
 
The calls followed comments from the senior Lib Dem MP in which he announced plans to tackle excessive pay awards for company executives.

SNP Business and Enterprise spokesperson Mike Weir has called on the UK Government to step in and speed up the compensation process for Farepak families after receiving a letter from liquidators confirming that 207 agents and customers of the Christmas saving scheme have died since the company’s collapse five years ago.

Mr Weir said:

“We hear a lot of talk about moral capitalism by Coalition Ministers, but there is not much evidence of action when it comes to helping those who have been failed by the system.

“Moral capitalism should not just be about bankers’ bonuses but about helping ordinary people and, as Business Secretary, Vince Cable could start by demanding justice for the victims of the Farepak collapse.

“It is now five years since the company collapsed, yet thousands of ordinary savers, more than 200 of whom are now dead, have received absolutely nothing whilst the liquidators have pocketed fees in excess of £8million.

“Savers are likely to recover just 5 pence in the pound, while the final bill for the administrators and their legal advisers has already exceeded £8 million.”

Farepak collapsed in October 2006 owing £37m to more than 119,000 savers (20,000 customers in Scotland).  More than five years later, savers are likely to recover just 5 pence in the pound, while the final bill for the administrators and their legal advisers has already exceeded £8 million.

Mr Weir added:

“Had they been savers in a bank their savings would have been guaranteed, but because they were savers in Farepak they got absolutely no protection and ended up as ordinary creditors in a liquidation.

“Neither the previous Labour nor present Coalition Government have done anything to help them.

“If there is really any substance behind the rhetoric of moral capitalism then Coalition Ministers must now exert pressure to get justice for Farepak savers, otherwise this will simply be another in a long line of empty gestures.”