'Farepak' safety net
STEPS to prevent a repeat of the Farepak Christmas savings club fiasco were announced yesterday.
A Government-commissioned review – backed by Consumer Minister Ian McCartney – proposes ring-fenced accounts for customers’ money. Companies couldn’t use it for any other purpose.
The Government also announced £1million for the Office of Fair Trading to raise awareness of Christmas saving schemes.
More than 150,000 customers lost £40million when Farepak’s parent company went bust in October last year.
The review was carried out by Brian Pomeroy, of the Financial Inclusion Taskforce, who said: “This package will go a long way to prevent a nightmare, and I don’t think that’s too strong a word, like this happening again.”