Bank's £8m for customers of failed hamper firm Farepak
A bank has decided to make £8m available to help former customers of the collapsed Farepak Christmas hamper business after a judge suggested it should look to its morals.
Mr Justice Peter Smith had pointed the finger at Farepak's bankers during a hearing at the High Court in London yesterday. HBOS defended its actions last month after the judge accused it of taking a “hardball approach” and suggested the bank “seriously consider” adding to the £2m it put into a distress fund in 2006 for Farepak's customers.
HBOS is now part of Lloyds Banking Group, which said in a statement yesterday that it has chosen to make an ex gratia payment of £8m “in the light of recent comments from Mr Justice Smith”.
It emphasised that HBOS acted legally, but said the group had “wider responsibilities” to the community, as well as legal and financial obligations.
The Lloyds Banking Group statement said: “We are now working to ensure this money goes directly to those customers.
“While HBOS acted legally in its dealing with the company, as the judge himself acknowledged, we are mindful that, in acquiring HBOS in 2009, the Group took on not only its legal and financial obligations, but also wider responsibilities. We have a crucial role to play in supporting the communities in which we operate.”