Leicestershire Farepak clients in payout fury
Hundreds of people in Leicestershire lost almost £300,000 after the company went bust in October 2006.
Since the collapse about £6m has been recovered – but half has gone to accountants and lawyers, while thousands of customers have been told to expect to get just 5p for every pound.
The massive legal and accountancy bill was racked up by administrators and liquidators BDO Stoy Hayward, who blamed the amount of fees on having to untangle Farepak's "complex" financial affairs.
Leicestershire customers were dismayed by the fees because the most they could expect was a token gesture.
Across the country, more than 150,000 people lost money from the scheme, which allowed them to hand over money throughout the year in return for goods and vouchers at Christmas.
In October, liquidators began sending cheques to some customers whose money had been put into a trust fund by Farepak.
But just 5,900 will be getting the cheques, for about 5% of what they were owed.
For the other 144,000 customers, there is still hope of compensation in the future – but it will not be much.
Jeffrey Brotherhood and his wife Kathleen, both 59, lost £350 and do not know if they will be getting a cheque.
The couple from Ellistown, near Coalville, were agents for the Wiltshire company and had 14 customers owed thousands between them.
Mr Brotherhood described the legal and financial bill as a "diabolical amount of money".
He said: "Surely it shouldn't cost that much to wind up a business? We feel totally let down by it and I really feel for all the other customers and their agents who have lost thousands of pounds.
"To be paid 5p in the pound is meaningless. It's an insult to us. It's disgusting. At the start of all this, we hoped we might get at least 60% of what we lost.
"The whole experience has been very disheartening."
Linda Porter, from Aylestone, Leicester, lost £1,000 and is not expecting to get any of it back.
She was an agent for about 15 years and many of her 25 customers were each owed more than £1,000.
She said: "The longer this process goes on, the more money disappears. It makes me angry.
"Even if I did get something back, it's not worth the paper it's written on. It's pennies compared to what we lost."
A statement from BDO Stoy Hayward said: "The administration and liquidation of Farepak has been complex and involved an exceptionally large number of creditors, the identity of whom were unknown at the outset of the administration.
"Associated fees and external costs reflect the amount of time that has been spent in handling this work."
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