Monday, November 13, 2006

Local help for victims as Farepak fatcats take the cash…

Residents of Deeping St James and Frognall facing hardship after the £40 million collapse of hamper firm Farepak may be eligible for help from a local charity.

I don’t know if any of the 100,000 victims of the scandal live locally, but I or any of the other trustees of Deeping St James United Charities would be happy to be approached.

United Charities assists any member of our community who falls on hard times. Contact details are on their website which has just been launched, or drop me an email in confidence at fairdealphil@hotmail.com

The scale of the Farepak scandal is becoming clearer by the day. As the company headed for disaster, fatcat directors trousered massive bonuses. At the same time, they continued to collect weekly payments from their 100,000 subscribers saving up for a Christmas hamper.

At the weekend, the Daily Mail contrasted the Christmas the Farepak fatcats will enjoy with the misery they have caused their customers.

Just as grotesque is the revelation that money that should have provided Christmas hampers for their customers was actually being spent to buy other failed businesses.

Labour MP Anne Snelgrove has named and shamed Farepack directors, singling out Sir Clive Thompson, chairman of Farepak’s parent company special as 'a modern day Scrooge'.

She called Thompson
'the man who bemoaned a 30p rise in the minimum wage when he was earning over £2 million a year'.

'This is the man who wound up the pension scheme while at Rentokil for all but the executives and then walked off with a £690,000 a year pension.'
Some MPs have called for the former CBI president to be stripped of his knighthood.

Anne also rounded on Farepak chief executive William Rollason
'who, I understand, is soon due to appear in an Australian court possibly on a not unrelated issue for another company'
and Farepak executive director Nick Gilodi-Johnson, whose father Bob Johnson founded the business. Gilodi-Johnson is set to inherit £75 million.

Anne added:
'No doubt Sir Clive and those directors will be eating a very big turkey this Christmas, and enjoying it.'
Anne’s an old friend – I knew her years before she deservedly became an MP and I know she will keep up her campaign until she gets justice for Farepak’s victims.

12 comments:

Michael Oakeshott said...

They are not fatcats, they are criminals. Why does everything have to come down to class with the likes of you Phil. If a kid on a council estate was robbing cars, would it be right to refer to him as a working class yob? No. Because it would be offensive to working class people. If the kid was black, would it be right to refer to him as a black yob? No. So don't refer to fatcats as criminals.

It is highly offensive to fatcats.

Anonymous said...

Michael - you are absolutely right - they are common criminals and should be prosecuted but this government has like the last Conservative one shied away from prosecuting business "leaders".It is sad that you bring class into it phil - this has nothing to do with class at all.It just shows your own prejudices clearly.Let the Police investigate these people and bring charges in the same way as they are investigating Labours loans for peerages.

Brynley said...

Hang on a minute!

Farepack took a long time to emerge as the STINKING SCANDAL that it is because the people who lost out were ordinary families on low incomes.

Anonymous said...

Brynley,Well,what about Labours raid on pension funds over the last decade - £100 Billion or in that kind of ball park - who the hell do you think will end up paying for that but ordinary working people.Then again its all spin,smoke and mirors in politics and this has permeated across society these days which is why people like these clowns at Farepak get away with stuff like this.

Liz said...

My understanding from reading the financial press is that although MPs are calling for the serious fraud office to become involved, it appears that no criminal offence has been committed. This sector is apparently not regulated. I believe that interest has to be paid out to come under the Financial Services Authority. I do hope that some form of legislation from the DTI is forthcoming to ensure that such business people cannot prey on those in society who do not have access to credit ever again..

In my opinion, class does have some bearing. The majority of people who save in this sector do not have access to credit nor have bank accounts. The Post Office was supposed to assist with such difficulties but my understanding is that whilst they will accept benefit cheques they do not accept wages cheques? Some people involved in the loss do work but with very low wages. The people who have lost their monies - are the underprivileged class who do not have access to the same financial services and protection that are available to me. They have a right to be protected and legislation to ensure this does not occur again must be speedily introduced.

Those involved in the Farpak business have been villified in the press. Their lame excuses - blaming HBOS has been torn to shreds. All I can hope for is that they become ostracised within the business community and that future ventures into business (inevitable) by these rogues flop. No serious investor will touch them with a barge pole in the future. They are a despicable and unethical bunch and should be shamed in everyway possible if, as I believe, we cannot prosecute them.

fairdealphil said...

michael and anons:

You both raised the issue class, not me.

Before you accuse me, please read my post, then tell me who's obsessed with class - me or maybe You!

Michael objects to my use of the word "fatcats" to describe Farepak's greedy directors.

If you click on the link in my post, you'll see the Daily Mail calls them 'fatcats'.

Whether these particular fatcats have actually broken the law is a matter for the police.

fairdealphil said...

Liz:

you are right.

This sad tale highlights how a few greedy rich fatcats have benefitted hugely from weekly collections taken from thousands of people saving up for a hamper at Christmas.

They will never see the hampers or their money again.

People like the ex-President of the CBI Sir Clive Thompson should never be allowed to take charge of a whelk stall.

It really does STINK!

Michael Oakeshott said...

I am not a spokesman for the Daily Mail. The word appeared in your post on your blog, so it is your responsibility, not theirs. You and I both know what you were trying to do. You might not have used the words, but the meaning was very apparent. Shame on you. These people are the victims of what should be a crime. If it isn't a crime then we know to blame the Government for this mess like so many others recently. No amount of criticism for businessmen, or faux sympathy for the so-called working classes, should disguise Labour's incompetence here. Businesses are there to make money within the law, the Government are there to use the law to protect innocent people from scams. It appears that this business simply outwitted the dimwits in number 10.

Michael Oakeshott said...

BTW Why doesn't Tony try to get some of the money back by selling him a peerage?

Geoffrey Brooking said...

I have every sympathy for those who have lost out and well done Phil for putting the details on your site.

However, my strong feeling is that HBOS should pay the victims in full.

fairdealphil said...

Geoffrey:

i agree. HBOS are not coming out of this with any credibility.

it's easy to join the "something must be done" brigade and of course it must be.

but if government intervenes, will those calling for action now be the first complain of more red tape?

i think it would be helpful if the CBI made a comment on the activities of their former President and perhaps encouraged their members to support the rescue packages.

Liz said...

HBOS does seem to have some case to answer. They are under strict codes related to the bank's savers money, yet they apparently continued to take £1m savings each week from Farepak customers to reduce the companies debt to the bank. Not illegal(they were not savers of the bank) but somehow it seems rather immoral to me by a company that made £5bn profit last year. The bank also knew that Farepak's parent company EHR had its shares suspended in August. Farepak's income prior to the collapse of EHR from savers was being used to support EHR. Interesting too that EHR sold off the profitable bits (propped up by Farepak savers)earlier and got £34m. I accept that money moving across group wide businesses is OK but surely the practice should not be allowed with savers money?

I think HBOS should have pulled the plug earlier. They permitted Farepak to make the decision in October that their business was untenable. Interesting time of the year to make the decision given earlier events - coffers full of saver's money of course. HBOS has acted within the law yet somehow their standing has been diminished in my eyes. I hope they lose many customers who are worried about the morality of this saga. I look forward to reading the DTI investigation and hope the Directors of all related/parent companies are hung out to dry.

ps. There is a telephone number to make a donation.