Last updated 19:26, Thursday, 13 November 2008

FAMILIES in West Cumbria who lost money when Christmas savings firm Farepak collapsed have been given fresh hope of claiming back more of their missing cash.

Hundreds of families were left out of pocket and facing a bleak festive season when the company went bust almost two years ago.

Liquidators have been examining the company’s accounts in an investigation that has so far cost over £1 million. Now legal action has begun against the parties involved in a bid to get back more of the savers’ cash.

Joint liquidators Martha H Thompson and Dermot Power of BDO Stoy Hayward LLP have announced the legal proceedings in a report to agents and creditors.

They said they could not give any further details, but the action is thought to involve the failed company’s directors.

It has been estimated that more than 150,000 people nationwide lost about £40m when the savings scheme firm folded just weeks before Christmas.

Trade creditors’ claims listed in October’s report total £3.6m.

The report confirms that families who lost out when the firm went under are still likely to receive just 5p for every £1 they invested, but it is thought this could increase pending conclusion of the proceedings.

Susan Nixon, 58, of Mosser Avenue, Cockermouth, lost £350 following the collapse.

Her sister, mum, daughter and mother-in-law all lost money. Her daughter was a Farepak agent.

She said she was not hopeful of seeing the money again.

She said: “Quite a few women from work had money in Farepak. I don’t know anyone who does it now. We are more careful with our money, especially with the credit crunch.

“I don’t suppose I will ever see the money again. It has definitely changed the way I save money. I set up a savings account because it is safer.”

Workington MP Tony Cunningham recently met the liquidators of Farepak in Westminster when he demanded answers over action to ensure justice is done for the families who lost out.

He said: “I am pushing as hard as I can with other colleagues to get this resolved. The problem is that legal issues take time.”

The Government is yet to decide whether Farepak bosses will be prosecuted over the company’s collapse.

An official investigation has already been completed but will not be published for legal reasons.