Tuesday, October 24, 2006

The Farepak who stole Christmas

Tuesday, October 24, 2006

I can't decide which of my two favourite recurring themes to file this under; it's a toss up between 'everyone is stupid except me' and 'unloading the emperor's new clothes'.

Prior to going bust this month, Farepak, was the best-known Christmas hamper and food/gift voucher supplier in the savings scheme market. The idea is that you set up a direct debit to issue monthly payments to the company, and then as Christmas approaches they issue you with either a modest hamper or the privilege of purchasing overpriced food or gifts from their own store. In effect they operate as a bank who profit from investing your money, but don't reward you with interest payments. Not only do they not pay you any interest, you actually pay them for sitting on it.

Believe it or not this bizarre scam appealed to thousands of people. Some thought it was such an ingenious concept they even signed up to become proselytising agents for Farepak. I expect they're having second thoughts now the company have gone into administration leaving them high and dry.

Of course it's atrocious that Christmas this year is going to be pretty much null and void for these low-income families (while the managing directors of this crooked firm stuff their faces with luxury mince pies and port at the Hilton), but you've got to wonder what they were smoking when they agreed to pay Farepak to take their cash. Even if they'd stuffed their savings under a mattress and let it gather dust it would still be there by the time Christmas rolled around. Rocketry it's not.

What have they got against grown-up money? The fact that it can be spent anywhere, or that - providing you don't shop at Harrods - 100 pennies equals a pound?

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