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Sledgehead

Bride-lawyer Holds Bank Responsible For Biz Failure

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Extraordinary story this morning of a recently wedded couple who are going to march on HSBC today to see whether the bank will cough up the money her wedding guests gave to WrapIt, a wedding list company, hit by the credit crunch.

The bride showed up on the Breakfast couch. She claimed to be just like the victims of Farepak, tho frankly she sounded like a hooray-Henrietta. I checked her profile and she is apparently some kind of lawyer, tho I do wonder which law school allowed her to graduate with the belief that the pecking order of secured ceditors (bank) and unsecured creditors (customers) is open to debate.

Presumably she is trying to embarrass HSBC, wearing her poor-lickle bride hat. Personally if I were an HSBC shareholder I would be marching against her. SHE chose her wedding gift company, and IT chose to take on business risk. This is NOTHING like a Farepak situation where we were dealing with a company that posed as a pseudo-bank (where is the risk in holding savers money - logic dictates there should be none). Most of the wedding list customers will have paid by credit card in any case and be protected by the consumer credit act.

The fact is when we buy, we are entering into a business transaction and we become an unsecured creditor to the retailer. As a lawyer she should know this. Indeed, as a lawyer sporting a hooray-henrietta accent, she should even be embarrassed to make a fuss over losing £7000 of gifts she clearly doesn't need (she left them unclaimed for 12 months) to a wedding list company SHE chose. Presumably she views herself as being an A in the socio-economic rankings. She and others just like her should start behaving that way and display the dignity Britain was once famous for. Last week we bemoaned the loss of the Dunkirk spirit. It seems the stiff upper lip has gone the same way.

Edited by Sledgehead

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Guest DissipatedYouthIsValuable

The insurmountable loss of a fondue set is more than some are able to bear.

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We got al ot more of this coming.

A customer deposits with a business.

Bank takes deposit and reduces the OD facility for the business by the deposit.

Business therefore has now NOT got the money it received, the bank ahs taken it.

Business falls over due to cash flow.

Well done the HSBC, removing the umbrella it sold to the business during the summer.

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Anyone else remember the last recession? There were often news stories and programs like Watchdog showing stuff about people ordering furniture etc, only for the firm to go bust with the customers that had already paid being shafted. The bad old days are back.

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Anyone else remember the last recession? There were often news stories and programs like Watchdog showing stuff about people ordering furniture etc, only for the firm to go bust with the customers that had already paid being shafted. The good old days are back.

FYP

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Anyone else remember the last recession? There were often news stories and programs like Watchdog showing stuff about people ordering furniture etc, only for the firm to go bust with the customers that had already paid being shafted. The bad old days are back.

same with taxes.

i ordered a weekly bin collection, dentist and adequate housing provision.

but the government went bust and i didnt get my goods id paid for.

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If a bank allows a business to continue trading (ie, taking customer money) when it's obvious that the business model is going nowhere then it IS partly responsible for what happens IMO

If the bank claims that they did not know what was going on then they are incompetent (and also therefore culpable).

Also, wouldn't most of the guests have paid for the items using a credit card? - with some sort of protection?

Good luck to her, I say.

Buckers

What has the continued trading got to do with a Bank? Its the Company's Directors who decide that.

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Anyone else remember the last recession? There were often news stories and programs like Watchdog showing stuff about people ordering furniture etc, only for the firm to go bust with the customers that had already paid being shafted. The bad old days are back.

That's why it's always best to pay for something and take it away the same day, even if it means hiring a van. Even better, head down to the local second hand furniture shop, usually much better furtniture at much better prices, and you can take it with you the very same day.

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Anyone else remember the last recession? There were often news stories and programs like Watchdog showing stuff about people ordering furniture etc, only for the firm to go bust with the customers that had already paid being shafted. The bad old days are back.

If you purchase with a credit card (not a debit card) you have some protection, as the card issuer has some liability if you don't receive the goods, unless they've changed the law recently on that?

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I saw this She said her guests could of claimed the money back from their credit cards had she of told them... she could of done that but no, it was too "embarassing" for the poor lady. She needs to get with the program get off her high horse and put things in perspective. To aliken herself to a victim of the farepack collapse is pretty ofensive on so many levels. I bet hsbc are quaking in their massive offices.

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If you purchase with a credit card (not a debit card) you have some protection, as the card issuer has some liability if you don't receive the goods, unless they've changed the law recently on that?

But if large number of firms start going bust, then the rates and charges on CCs will increase, so you all pay for it in the end.

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Something odd about it,

They never made a profit in six years of trading, suppliers had, in one case, not been paid since last year

and they have £3.5m in debt.

Yet they acted as middle men, just collecting goods and offering a service. The people I feel sorry for are

the suppliers and customers. HSBC and the owner losing it all doesn't bother me.

Of course the "credit crunch", what does that even mean now???? , is to blame.

It wanted to take on big names such as John Lewis and Debenhams with a huge database of gifts to choose from.

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.

http://news.bbc.co.uk/1/hi/business/7540758.stm

Founded in 2000 by Canadian-born former fashion journalist Diamand, the firm blamed the credit crunch and retail-market

problems for its woes. It sent a letter to customers recently claiming HSBC had “withheld £1m of our money”, leaving it in a cash

crisis. However, accounts show the company has made a loss for the past six years.

Diamand, who recently returned from a holiday in Sardinia, could not be reached. HSBC and KPMG declined to comment

http://business.timesonline.co.uk/tol/busi...icle4449580.ece

Is it true that the financial difficulties were caused by HSBC blocking card payments and holding £1 million of Wrapit's money?

The Administrators are aware that Wrapit had been struggling for some time (the company has made losses for a number of years)

and had been seeking funding from other sources but without success. The Administrators have a duty to produce a report to creditors within

8 weeks and this report will give further details of the events leading up to the Administration of Wrapit. The Bank has advised that it regrets

the failure of the company but it had taken professional advice and believes it acted wholly appropriately in the circumstances.

http://www.wrapit.co.uk/Wrapit.asp

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What has the continued trading got to do with a Bank? Its the Company's Directors who decide that.

Surely if the bank pulls a loan then it effectively stops you trading.

What gets me is how you c0ck up a business like this. Take all the money up front. Then buy some stuff and deliver it. Bit of a website and storage infrastructure but how in the world do you break this kind of business.

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What gets me is how you c0ck up a business like this. Take all the money up front. Then buy some stuff and deliver it. Bit of a website and storage infrastructure but how in the world do you break this kind of business.

I don't think its the right business model really. John Lewis and Debenhams would be moreorless bound to be more competetive than something like this as they already have all the infrastructure.

Then there are the DIY lists like whattogive.com. This site seems to be funded by click throughs. OK its not quite as robust and relies on trust but it seems more appropriate to the British way of doing things. I personally detest the type of wedding list where you are just supposed to tick a box and hand over the cash without ever getting to see/wrap/give the item.

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What gets me is how you c0ck up a business like this. Take all the money up front. Then buy some stuff and deliver it. Bit of a website and storage infrastructure but how in the world do you break this kind of business.

I don't know about this particular case, but one or more of the following is probably to blame:

the start up capital was not sufficient,

unrealistic business / growth plan,

management salaries too high,

etc.

There are loads of new businesses failing every week, most of them default on other businesses / government, these sort of failures, whereby the general public loses by paying up front, are rarer but usually are high profile when they do happen (Farepak, red letter days ...). Perhaps we need some legislation for monies paid in advance to be held in trust/client accounts, although this would probably be more time consuming and costlier than the odd failure, and I think we're over legislated anyway.

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I don't think its the right business model really. John Lewis and Debenhams would be moreorless bound to be more competetive than something like this as they already have all the infrastructure.

Then there are the DIY lists like whattogive.com. This site seems to be funded by click throughs. OK its not quite as robust and relies on trust but it seems more appropriate to the British way of doing things. I personally detest the type of wedding list where you are just supposed to tick a box and hand over the cash without ever getting to see/wrap/give the item.

It does seem a bit pointless since John Lewis, Debenhams, Argos, M&S and others all do wedding list services, and most also gift wrap for you if you're too lazy to do it yourself.

Getting married next year but since we aren't buying a place and already have all the furniture, pans and other random house crap we're just going to ask for guest (mostly family anyway) to donate something to our Honeymoon.

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Guest DissipatedYouthIsValuable
Surely if the bank pulls a loan then it effectively stops you trading.

What gets me is how you c0ck up a business like this. Take all the money up front. Then buy some stuff and deliver it. Bit of a website and storage infrastructure but how in the world do you break this kind of business.

By being a compulsive shopper?

I can just imagine some looney chick with an OCD shopping fixation, "One for you, two for me..."

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Guest DissipatedYouthIsValuable
Getting married next year but since we aren't buying a place and already have all the furniture, pans and other random house crap we're just going to ask for guest (mostly family anyway) to donate something to our Honeymoon.

Not sperm, I hope.

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It does seem a bit pointless since John Lewis, Debenhams, Argos, M&S and others all do wedding list services, and most also gift wrap for you if you're too lazy to do it yourself.

Getting married next year but since we aren't buying a place and already have all the furniture, pans and other random house crap we're just going to ask for guest (mostly family anyway) to donate something to our Honeymoon.

Why not tell them to keep the money and spend it on themselves (or give it to charity)?

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Why not tell them to keep the money and spend it on themselves (or give it to charity)?

Because it's a wedding, and people always gets gifts for the bride and groom. If we don't specify what we want then i'll end up with a £50 carving knife i won't use, or 12 champagne flutes, or a load more plates that won't fit in the dishwasher.

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Guest DissipatedYouthIsValuable
Prefferably not sperm, but it depends how valuable it is at the time.

Comedy gourds? One can never have enough comedy gourds.

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Surely if the bank pulls a loan then it effectively stops you trading.

What gets me is how you c0ck up a business like this. Take all the money up front. Then buy some stuff and deliver it. Bit of a website and storage infrastructure but how in the world do you break this kind of business.

Yeah, but when you build a business, you take loans to buy cars, pay for rent, admin, computers etc etc. suddenly take away the profits and poof, you still have the overheads.

Banks assess businesses not only on a case by case basis, but also the trade they are in.

So, for example, you might be the only EA doing well in your town, but your access to credit will depend also on the trade you are in, so banks see EAs doing bad, the whole lot must be. Time to call in the overdrafts.

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Caught some of this, they got married in October but the wedding list remained open until February or something like that :huh: I would have thought a wedding list would close before the wedding or has tradition changed?

Edited by sandster

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  • 399 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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