Farepak victims to protest
People who have lost their Christmas savings in the collapse of savings club Farepak are to hold a protest outside the Edinburgh offices of Halifax Bank of Scotland (HBOS), a big provider of UK current accounts. The protest will coincide with a reception to be held by the bank.
HBOS has been severely criticised for offering business banking services to Farepak’s parent company, European Home Retail, while allegedly being aware of the firm’s serious financial problems. When Farepak collapsed in October, some 150,000 people lost up to £50m of savings earmarked for Christmas shopping. This equates to an average shortfall of around £400 each.
The Government has expressed concern that such an event could happen at all, and that the savings club sector is largely unregulated. There are no criteria available for people to compare saving accounts and it would like to see this changed, with legislation covering the area.
The Farepak Response Fund (FRF) has been launched to try to compensate savers for at least some of their losses. So that the business banking UK sector does not look too tarnished by the affair, HBOS has given £2m to the fund, which now totals £6.4m, still a significant way below the total amount lost.
HBOS is reportedly stepping up its security for the reception in readiness for the protests.