‘No money’ for Wrapit customers

Posted by admin on 14 August, 2008 under Business news | 2 Comments to Read

Customers of collapsed wedding gift list operator Wrapit are unlikely to get any money back from the business, the administrators have said.

They said funds were unlikely to be available to customers without presents or Wrapit’s staff and its suppliers.

No buyer has been found for the business, which was founded by a former journalist in 2000 but ceased trading on 4 August, owing millions of pounds.

Out of 73 members of staff, 53 have now been made redundant.

Remaining presents

The remaining staff are staying on for a short period of time to deal with newlyweds who have presents ready for them in the warehouse. These couples have received letters telling them that they have presents to collect.

But this process has not been without its problems after the telephone service provider pulled the line to the warehouse on Monday. It has now been reconnected.

Some newlyweds held a protest last week

Staff will also take calls on the helpline for concerned couples without their presents.

But administrators Jane Moriarty and Myles Halley, of KPMG, said that the majority would now not receive any of their gifts.

About 2,000 have been waiting to see if they will receive any of their presents.

Administrators study the state of a business when they are called in. They oversee the sale of assets to pay back creditors.

The bank – HSBC in this case – has first claim on the money, with unsecured creditors, such as customers, staff and suppliers, at the back of the queue.

“At this stage we do not consider funds will be available for distribution to unsecured lenders,” said Mr Halley.

Claiming

That means most customers who paid for gifts by cheque or debit card will not receive any money back.

Customers who paid by credit card can claim from their card supplier, although this is only absolutely guaranteed if they spent more than £100. Those who spent less or used a Visa debit card will be considered for a refund on a case-by-case basis.

Wrapit vouchers cannot be used anymore and refunds for faulty goods can no longer be made.

Trading standards officers said customers should formally register as a creditor, by writing to the Wrapit administrator KPMG at 8 Salisbury Square, London, EC4Y 8BB.

They should outline details of the gift and where it was bought.

Wrapit was co-founded by former fashion journalist Pepita Diamand in 2000, but failed to make money. It owed HSBC £3.5m when it collapsed.

As well as its central warehouse in Acton, west London, the firm has two London showrooms and others in Aberdeen, Beaconsfield, Belfast, Birmingham, Bristol, Canterbury, Darlington, Glasgow, Harrogate, Manchester, Newbury, Newcastle and Norwich.

The administrators will release more information about Wrapit’s failure in eight weeks.

News reported by The BBC