Court dashes Christmas hope for Farepak losers
Customers of the collapsed Christmas savings club Farepak who were hoping that a High Court ruling would entitle them to at least some of their UK investment in the scheme, have been disappointed.
Under dispute was the legal status of the money deposited with Farepak between its failure in October and when it went into administration as a saving and investment firm a short while afterwards.
Mr Justice Mann had to rule on whether local Farepak agents held savers’ money, paid in the key period, in an interim fund “in trust” on behalf of the firm, or whether they held it for the customers themselves.
Savers who had made savings and investment in Farepak in the disputed period were hoping to get back sums ranging between £17 and £1,500, but these were dashed by the judge’s ruling.
Based on the evidence he had presented to him, Mr Justice Mann said he could not award any money to savers in the UK investment scheme at this stage. He accepted that Farepak subscribers were suffering real hardship and that they would regard his decision as “technical and unmeritorious”.
However, he stressed that the funds had to be disposed of properly and on the basis of law, “not purely on the basis of sympathy and Christmas”.