F
raud investigators have opened an inquiry into the collapse of a funeral plan supplier.
Safe Hands Plans collapsed final 12 months, after 46,000 prospects had paid into it, anticipating a contribution in the direction of future funeral prices.
The Serious Fraud Office (SFO) stated it’s investigating a suspected fraud on the firm and its mother or father, SHP Capital Holdings Ltd.
Funeral plans have been marketed for years as a means for folks within the later levels of their lives to place apart just a little cash every month so their households aren’t burdened with an enormous invoice after they die.
The plans turned significantly common as funeral costs soared, however there have additionally warnings, with critics saying there may be little or no safety ought to the supplier go bust and never have the ability to uphold its finish of the deal.
Some additionally criticised the massive administration prices that funeral plan suppliers cost prospects.
SFO director Nick Ephgrave stated: “Thousands of individuals from all corners of the UK lost peace and security after being sold a product on the basis it would help reduce the burden on their loved ones upon their death.
“Today, we have taken decisive next steps in our full criminal investigation into Safe Hands Plans.”
The SFO has written to stockbrokers, monetary establishments, banks and different witnesses as a part of the probe.
Safe Hands went into administration in March final 12 months, with directors saying the corporate confronted a “combination of factors, some of which are understood to be linked to the Covid-19 pandemic”.
FRP Advisory, which is operating the administration, has beforehand stated it’s investigating why the scheme failed and the conduct of administrators.
After the collapse the supplier was now not in a position to uphold its pledge to make sure that somebody’s funeral was paid for after they died.
FRP stated collectors of the corporate have claimed round £70.6 million.
It stated Safe Hands had used the cash it received from prospects to make investments and pay for the price of administering the plans. Administrators are actually promoting off these investments to allow them to return some cash to prospects.
But they warned there’s a “shortfall”, which signifies that the worth of those investments shouldn’t be sufficient to satisfy the corporate’s funeral obligations.
