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Labour MP Frank Field has called on HBOS to recompense savers who lost money as
a result of the collapse of Christmas hamper supplier Farepak.
He claims the bank should have pulled the plug on Farepak long before it went
into administration on October 13, potentially saving the money of 150,000
customers.
In an early day motion, Mr Field says that "HBOS allowed Farepak to continue
trading while it clawed back something like £1 million a week of people's
savings to offset the company's overdraft with the bank".
He urged HBOS to
"make good quickly the savings of decent citizens, carefully saving money with
Farepak."
Mr Field also believes that HBOS, which handled accounts for Farepak and its parent
company, European Home Retail, took £40 million from Farepak customers to reduce
overall group debt.
Farepak savers are owed £50 million and are likely to get
back only a few pence in the pound, if that, from the administrator.
HBOS rejected Mr Field's understanding of the process. It said in a statement:
"We accommodated the company on many occasions to allow management every
opportunity to find a solution to its financing challenge."
Source:
RedAlert
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