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Wrapit Crisis: How to get your money back
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MSE_Martin
Posts: 8,272 Money Saving Expert
Wrapit, a wedding list service, has gone into administration, meaning many couples and their guests could have lost money on wedding gifts purchased through the site.
Normally you'd have to go through the administration process, but during the Farepak crisis, we developed other successful techniques... and many apply here.
This means insolvency practitioners have been called in to run each company and get what cash they can for the creditors via selling or utilising the assets. In theory a business can be kept running as a ‘going concern’ but this is unlikely.
Most likely the insolvency practitioners will simply collect in the assets, try and sell what they can and then distribute whatever cash remains to creditors. When the money is distributed there’s a priority of who gets the money, which usually works a bit like this:
It means, to be within any chance of getting money back you’ll have to apply to the administrator for it, not Wrapit. Any money left after paying the secured creditors and employees will then be split between everyone else that has submitted a claim.
Unfortunately there's only a small chance you’ll get any money back by doing this. If you do it won't be very much and it will take some time to be resolved.
Details of how to contact the administrator is on Wrapit’s website. A helpline has also been set up for queries 0844 770 1301.
If your wedding gift cost over £100 and you paid all, or even part of this, on a credit card then your credit card company is equally liable under Section 75 of the Consumer Credit Act. In other words, whatever the rights you'd have with a retailer/company you have with the credit card company. So here, you have a claim for non-delivery of goods.
This is a legal protection that credit card companies have no choice about, as when you spend on a credit card, you're effectively entering into an arrangement to borrow (even if you pay off in full) so you get these rights.
How to get your money back
Call up the credit card company and tell it you want to make a claim, specifically state you're doing this under "section 75 of the Consumer Credit Act", though beware the call centre operative mightn't have a clue what you're talking about.
While hopefully it will be smooth, there is a chance it'll say you have to contact the company first or claim from it. This is not true. The law states it is jointly responsible, there is no 'first point of call', you are choosing to claim from it, and that is an acceptible decision. If it wants to try and claim off the company then that's its business.
Be firm but polite and request a claim form. Again, on the claim form state it is a claim under "section 75 of the Consumer Credit Act".
If you paid on a Visa credit card for something over £100, then use section 75 above as that is a legal protection and is stronger. Yet if you paid on a Visa debit card for any amount, or a credit card under £100, then you have a reasonable chance to get your cash back via the Visa Debit Chargeback system.
Also try this route if you have paid via Paypal. As a third party, purchases via it do not get section 75 protection. You may also qualify for protection under the Paypal Buyer Protection Policy or be able to use the PayPal Buyer Complaints Policy. More info.
Unlike with credit cards, Chargeback isn't a legal protection, but a protection from Visa's own rules. It's effectively Visa's own refunds system. It's designed so that if you pay for something and that order hasn't been adequately completed or is never received, or the order is illegitimate in some way, your bank can do a chargeback from the bank that collected the payment.
The crucial part of this is that the chargeback means you're asking for a refund from Wrapit's payment processing bank rather than Wrapit itself, which is great news, as Wrapit has no cash, but its bank does!
How do you do a chargeback?
Quite simply call up your bank, with all the details of the payments made to Wrapit (check your statements, if you don't have them ask the bank for details, but this slows things down) and ask it to start the 'Chargeback procedure' to get you your money back on the basis of "non-delivery of the goods".
At this point it's quite possible the person you're talking to will never have heard of Chargeback. Yet don't let that put you off. This is a legitimate system, and you need to (politely) stand your ground. If the bank says no, write an official letter of complaint and note that you'll be writing to complain to Visa.
Luckily, the more people who try to do a chargeback, the more likely it is the banks will know the process and proceed.
What about other debit cards?
Banks and building societies are not legally obliged to help but sometimes they do, this happened almost across the board with the Farepak problems.
If you paid via another type of debit card, you could have a go at asking for something similar to Chargeback, but the rules are different and nowhere near as strong. Please click reply to report this if you have any success, so others can benefit.
This site, and especially the forum was one of those at the centre of the campaign to get people's money back. In many ways the Wrapit’s administration is very similar to that of Farepack’s back in Oct 06.
Farepak, whilst called a hamper savings scheme, was in essence a system with no protection in place which people gave money to be stored by a company for it to buy goods. Wrapit is a company where others gave their cash to buy goods as wedding presents.
Many of the above techniques are tried and tested because of Farepak. If you have time (and those who are organising Wrapit customers) it's worth reading through some of the Farepak discussion to see some of the success stories of Farepack victims and how to coordinate your complaint.
Report back your experiences below to help others in your situation.
Wishing you the best of luck.
Feel free to discuss and organise (though be careful about liable) via these forums and also do check out http://www.wrapitcustomers.com/
Martin Lewis.
How to keep updated on the Wrapit situation
Any futher info, changes or successes about Wrapit money back will go in the free weekly MoneySaving e-mail.
[threadbanner]box[/threadbanner]
Normally you'd have to go through the administration process, but during the Farepak crisis, we developed other successful techniques... and many apply here.
What is 'administration'?
This means insolvency practitioners have been called in to run each company and get what cash they can for the creditors via selling or utilising the assets. In theory a business can be kept running as a ‘going concern’ but this is unlikely.
Most likely the insolvency practitioners will simply collect in the assets, try and sell what they can and then distribute whatever cash remains to creditors. When the money is distributed there’s a priority of who gets the money, which usually works a bit like this:
- The Insolvency Practitioners (if they didn’t get paid they wouldn’t do the job in the first place).
- Any secured creditors (if they’ve borrowed money that's secured on property/assets).
- Any employees (redundancy pay).
- Everyone else ranked equally (this includes customers, the Inland Revenue etc. and all will be ranked pro-rata).
It means, to be within any chance of getting money back you’ll have to apply to the administrator for it, not Wrapit. Any money left after paying the secured creditors and employees will then be split between everyone else that has submitted a claim.
Unfortunately there's only a small chance you’ll get any money back by doing this. If you do it won't be very much and it will take some time to be resolved.
Details of how to contact the administrator is on Wrapit’s website. A helpline has also been set up for queries 0844 770 1301.
Yet you've a better chance trying the following...
The standard systems don't work well. However in this case, as it was quite a high end company and much was via the web, a much better way is to rely on the plastic people paid with.
In both cases it is the person who paid for the gift not the wedding party who can reclaim. If it's your wedding party, feel free to link your gift givers here.
Did you pay for a gift worth more than £100 wholly or partly credit card?
If your wedding gift cost over £100 and you paid all, or even part of this, on a credit card then your credit card company is equally liable under Section 75 of the Consumer Credit Act. In other words, whatever the rights you'd have with a retailer/company you have with the credit card company. So here, you have a claim for non-delivery of goods.
This is a legal protection that credit card companies have no choice about, as when you spend on a credit card, you're effectively entering into an arrangement to borrow (even if you pay off in full) so you get these rights.
How to get your money back
Call up the credit card company and tell it you want to make a claim, specifically state you're doing this under "section 75 of the Consumer Credit Act", though beware the call centre operative mightn't have a clue what you're talking about.
While hopefully it will be smooth, there is a chance it'll say you have to contact the company first or claim from it. This is not true. The law states it is jointly responsible, there is no 'first point of call', you are choosing to claim from it, and that is an acceptible decision. If it wants to try and claim off the company then that's its business.
Be firm but polite and request a claim form. Again, on the claim form state it is a claim under "section 75 of the Consumer Credit Act".
Did you pay on a Visa Debit or Credit Card?
If you paid on a Visa credit card for something over £100, then use section 75 above as that is a legal protection and is stronger. Yet if you paid on a Visa debit card for any amount, or a credit card under £100, then you have a reasonable chance to get your cash back via the Visa Debit Chargeback system.
Also try this route if you have paid via Paypal. As a third party, purchases via it do not get section 75 protection. You may also qualify for protection under the Paypal Buyer Protection Policy or be able to use the PayPal Buyer Complaints Policy. More info.
Unlike with credit cards, Chargeback isn't a legal protection, but a protection from Visa's own rules. It's effectively Visa's own refunds system. It's designed so that if you pay for something and that order hasn't been adequately completed or is never received, or the order is illegitimate in some way, your bank can do a chargeback from the bank that collected the payment.
The crucial part of this is that the chargeback means you're asking for a refund from Wrapit's payment processing bank rather than Wrapit itself, which is great news, as Wrapit has no cash, but its bank does!
How do you do a chargeback?
Quite simply call up your bank, with all the details of the payments made to Wrapit (check your statements, if you don't have them ask the bank for details, but this slows things down) and ask it to start the 'Chargeback procedure' to get you your money back on the basis of "non-delivery of the goods".
At this point it's quite possible the person you're talking to will never have heard of Chargeback. Yet don't let that put you off. This is a legitimate system, and you need to (politely) stand your ground. If the bank says no, write an official letter of complaint and note that you'll be writing to complain to Visa.
Luckily, the more people who try to do a chargeback, the more likely it is the banks will know the process and proceed.
What about other debit cards?
Banks and building societies are not legally obliged to help but sometimes they do, this happened almost across the board with the Farepak problems.
If you paid via another type of debit card, you could have a go at asking for something similar to Chargeback, but the rules are different and nowhere near as strong. Please click reply to report this if you have any success, so others can benefit.
Lessons to be learned from Farepak.
This site, and especially the forum was one of those at the centre of the campaign to get people's money back. In many ways the Wrapit’s administration is very similar to that of Farepack’s back in Oct 06.
Farepak, whilst called a hamper savings scheme, was in essence a system with no protection in place which people gave money to be stored by a company for it to buy goods. Wrapit is a company where others gave their cash to buy goods as wedding presents.
Many of the above techniques are tried and tested because of Farepak. If you have time (and those who are organising Wrapit customers) it's worth reading through some of the Farepak discussion to see some of the success stories of Farepack victims and how to coordinate your complaint.
Report back your experiences below to help others in your situation.
Wishing you the best of luck.
Feel free to discuss and organise (though be careful about liable) via these forums and also do check out http://www.wrapitcustomers.com/
Martin Lewis.
How to keep updated on the Wrapit situation
Any futher info, changes or successes about Wrapit money back will go in the free weekly MoneySaving e-mail.
[threadbanner]box[/threadbanner]
Martin Lewis, Money Saving Expert.
Please note, answers don't constitute financial advice, it is based on generalised journalistic research. Always ensure any decision is made with regards to your own individual circumstance.
Please note, answers don't constitute financial advice, it is based on generalised journalistic research. Always ensure any decision is made with regards to your own individual circumstance.
Don't miss out on urgent MoneySaving, get my weekly e-mail at www.moneysavingexpert.com/tips.
Debt-Free Wannabee Official Nerd Club: (Honorary) Members number 000
0
Comments
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BBC Breakfast are doing a piece about this today at 6.40 am probably will be repeated before the end of the programme as they usually do.0
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Hi Martin
In terms of chargeback, how does one stand with a direct debit payment to Wrapit via Paypal, I couldn't see it above?
btw - Paypal have closed my dispute immediately.
Please advise, thanks.0 -
Why cant people just buy the presents themselves, and wrap them, cant understand why you should pay extra for this?
could someone explain?0 -
Why cant people just buy the presents themselves, and wrap them, cant understand why you should pay extra for this?
could someone explain?
LOL! I know exactly what you mean. Some people want specific things so have their list somewhere where they can have chosen that exact salt and pepper pot.
You can of course get the stuff, wrap them up yourself etc. But that's too much hassle for some folk.0 -
Why cant people just buy the presents themselves, and wrap them, cant understand why you should pay extra for this?
could someone explain?
He Hee - WrapIt is just a brand name for the wedding list service - it's not present-wrapping service!
I used them for my wedding about 6 years ago, and the service was diabolical. We were chasing them for months and months to get our presents delivered. Seeing these reports about WrapIt going to administration does not surprise me. I'm only shocked it's taken quite so long for their terrible service to collapse like this.
I sincerely hope any of you MoneySavers affected by this problem get a good outcome.0 -
We bought a gift for a couple which cost £25 and paid by credit card. From the aboved advice it looks like we have bno claim as it was lass than £100. ANyone know if thats the case?
I have also heard talk of a deal being done with Debenhams and all the couples would get vouchers. Would be good if that came off.0 -
I made an order through Wrapit at the beginning of July. Unfortunately when I went to make the order they would not allow a credit card transaction for one reason or another (obviously I am extremely suspicious of their reasons now) so, in a bit of a rush, I put the order through on my HSBC Debit card (Maestro). I have just tried to reclaim my money back from HSBC, using the 'Chargeback procedure' argument, through their internet banking phone number and their branch specific number....both to no avail. They both said that I would have to contact Wrapit directly, which having read the post on their website will be a waste of time.
Has anyone had any luck claiming in a similar situation or have any good ideas about who/what I could try next?
Obviously I don't hold a lot of hope out for retrieving this money but any help you could offer would be greatly appreciated.
cheers,
dg0 -
I'm £149 down too mate.
Stung by direct debit transaction via Paypal.
Time to move on, methinks.
It's my niece (the bride) I feel sorry for. She doesn't need this stress 1 week before her wedding. She's not fussed about the actual pressies, only the fact that her guests are losing money all over the place.0 -
Just been on to the Halifax about a Chargeback. Their official line is that this service is only offered to "Ultimate Reward" account holders, and if I can't contact Wrapit directly for a refund my local Citizens Advice might be able to help...... useful0
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different_gravy wrote: »I made an order through Wrapit at the beginning of July. Unfortunately when I went to make the order they would not allow a credit card transaction for one reason or another (obviously I am extremely suspicious of their reasons now) so, in a bit of a rush, I put the order through on my HSBC Debit card (Maestro). I have just tried to reclaim my money back from HSBC, using the 'Chargeback procedure' argument, through their internet banking phone number and their branch specific number....both to no avail. They both said that I would have to contact Wrapit directly, which having read the post on their website will be a waste of time.
Has anyone had any luck claiming in a similar situation or have any good ideas about who/what I could try next?
Obviously I don't hold a lot of hope out for retrieving this money but any help you could offer would be greatly appreciated.
cheers,
dg
Same here, paid £25 on my First Direct Maestro card, called FD and they said "there's no protection on Maestro payments sir"
oh well..... live and learn I guessWorking through my debts one company at a time0
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