BusinessBusiness RecoveryKPMG calls for law change following Wrapit saga

KPMG calls for law change following Wrapit saga

Government urged to re-think company director responsiblity when it comes to advance payments

The administrator of failed wedding list company Wrapit has called for the UK
law to be changed to protect customer money paid in advance for orders.

Myles Halley has called for UK company law to be changed to ensure money paid
in advance for goods is protected if companies go bankrupt.

Administrators KPMG, are preparing to announce they have abandoned
efforts to find a buyer and will wind down the online service within three
weeks.

The company’s co-founder, Pepita Diamand, had been trying to buy Wrapit back.

KPMG has written to Wrapit’s directors asking them to explain how the wedding
list service’s finances were managed. It will report its findings to the
Department for Business Enterprise and Regulatory Reform.

The company’s lender HSBC has also been under the spotlight for ring-fencing
£1m of Wrapit’s money when it became apparent that the company was verging on
bankruptcy. Wrapit’s management claimed in a message on its website that the £1m
would have been devoted to ‘fulfilling our orders’.

Wrapit was set up in 2000 and designed to allow couples to compile their
lists online with guests able to buy items through its website which the company
would then deliver.

Further Reading:

The
Daily Telegraph

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