HomeBusinessSafe Hands funeral clients may lose ALL their money

Safe Hands funeral clients may lose ALL their money


Thousands of elderly people who took out pre-paid funeral plans with one of key providers face losing most, if not all, of the money they handed over

Thousands of elderly people who took out pre-paid funeral plans with one of Britain’s key providers face losing most, if not all, of the money they handed over to the firm.

It means that the funerals they thought they had paid for in advance are unlikely to be honoured – even though they had been led to believe that their money was safeguarded in a trust fund, overseen by a third party. 

The news, which has left many customers distraught, follows the appointment of administrators at Safe Hands Plans, a firm based in Wakefield, West Yorkshire, specialising in selling pre-paid funeral plans to the elderly. A note on Safe Hands’ website says the appointment of administrators from FRP Advisory is a result of a ‘period of severe financial challenge which has left the business unsustainable in its current form’. 

Shock: Funerals many thought they had paid for in advance are unlikely to be honoured

A supporting question and answer document warns customers it is ‘uncertain that the funeral plans will be able to be fulfilled’. 

Last month, The Mail on Sunday presciently reported that thousands who had plans promising to cover the cost of their funeral would find out they had been sold a dud. 

This was because of the decision by the City regulator – the Financial Conduct Authority – to regulate the sector amid fears of widespread malpractice, including huge commissions taken by third-party sellers of plans, the cold-calling of vulnerable people, and, in some instances, fraud. 

The FCA will regulate all funeral plan providers from July 29 and is currently vetting those companies that have indicated they intend to keep selling plans, which typically cost between £3,000 and £4,000. 

Though no authorisations will be granted until close to when regulation comes in, the FCA has cajoled three providers into withdrawing applications because of financial issues. Safe Hands was one – the other two being Eternal Peace Funeral Plans in Bridlington, East Yorkshire, and PS Cremations Funeral Planning in Harrogate, North Yorkshire. 

Last month, the FCA ordered Safe Hands to stop selling new plans. It has yet to do the same to Eternal Peace or PS Cremations. News of this caused understandable panic among many of its 45,000 customers with some cancelling plans despite having to pay a £395 exit fee. Others decided to stay put. 

Catherine Pearce lives with her husband John near Burton-on-Trent in Staffordshire. They bought plans from Safe Hands six years ago, costing in total about £6,500. 

Catherine says: ‘I dealt with my mother’s funeral, where no financial provision had been made. So I thought there must be a better way, which is why we ended up taking out pre-paid plans with Safe Hands.’ 

She adds: ‘We felt good about it, especially for our two grown-up children. It should have meant one less worry for them on our deaths.’ 

Catherine did due diligence on Safe Hands before buying, and had no cause for worry until last month’s shock announcement from the company that it would no longer be selling new plans – and only promising to fulfil funerals up until July 29. 

She contacted Safe Hands as soon as she heard the news, but was encouraged to ‘sit tight’. 

Last week, Catherine told The Mail on Sunday: ‘We are both 70 years young and are most upset, especially as John has just undergone major surgery. There are so many increases in the cost of living. Now it seems we could end up paying twice for our funerals. I feel I have been deceived.’ 

The demise of Safe Hands supports the need for tough regulation. Until recently, the company was deemed a registered provider by the Funeral Planning Authority – an organisation set up to oversee pre-paid funeral plans. In announcing its registration, FPA boss Graeme McAusland said it was pleased the company had ‘demonstrated to our compliance committee it can satisfy the requirements of our rules and code of practice’.

Last week, he said: ‘Safe Hands’ inability or unwillingness to achieve FCA authorisation has crystallised issues that in other circumstances may have been manageable over time.’ 

The last accounts for Safe Hands show net assets of just £5,088 for the year to the end of May 2020. 

On Friday, the FCA said it would support the administrators and the wider pre-paid funeral plans industry in finding a ‘longer-term solution for Safe Hands’ customers’. 

The key rules to follow when buying a plan 

FIRST, do not buy a plan on the back of an unsolicited call. Cold calling about funeral plans is banned by law. Simply hang up. 

Second, ask for proof from any provider as to where your money will be held. It should go into a trust fund overseen by an independent company, such as a law firm. 

The trustees will ensure any withdrawals are above board. For example, plan provider Golden Charter makes its accounts available at goldenchartertrust.co.uk. 

Pure Cremation says it will send out details about the health of its trust fund to customers in coming weeks and publish them on its website purecremation.co.uk. Prosperous Life holds customers’ funds in The Great British Funeral Trust, managed by Embark Actuarial and Guardian Professional Trustees. 

If a provider is unwilling to reveal such information, walk away. For the past month, The Mail on Sunday has asked Safe Hands and its trustees Sterling Corporation for the latest trust accounts. They failed to oblige. An unwillingness to disclose details may be a sign the provider is putting customers’ money into its business bank accounts, meaning the money is not protected.

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