BBCMargaret and David Fee spent thousands of pounds pre-paying for funeral costs to ease the trauma of their loved one’s death.
But in 2022, they and 46,000 others discovered that Safe Hands Plans Ltd – the company they trusted to organise their funerals – had collapsed.
Two years on, and despite an ongoing fraud investigation into the company’s trading, Margaret and David have neither received a penny of their money nor the answers they demanded about what went wrong.
A consumer group has called on ministers to launch a public inquiry into the collapsed funeral company following the new government’s election.
Margaret, a former NHS bereavement officer, said the schemes were paid for by David’s pension.
She said she only worked part-time so her pension was “very small”.
The couple, aged 78, are now retired and live in Rathby, Leicestershire.
In 2015, they each paid £2,745 from David’s pension to pay for the funeral.
Safe Hands assured them that their money would be protected and that every aspect of the funeral would be taken care of.
But seven years later, the company went into bankruptcy and the couple’s money disappeared with it.
Funeral plans are designed to allow people to set aside some money while they are alive to help their family pay for funeral expenses after they die.
Previously unregulated
The plans have become particularly popular as funeral prices soar, but questions have been raised about whether they lack protection if a provider goes bankrupt.
From July 2022, providers must obtain approval to operate from the Financial Conduct Authority (FCA), providing greater protection for consumers.
Safe Hands was one of dozens of companies in the previously unregulated prepaid funeral industry and collapsed four months before the measures were introduced.
The Serious Fraud Office (SFO) launched an investigation into Safe Hands in October 2023 and the investigation is still ongoing.
As customers who purchased directly through Safe Hands, Margaret and David had the opportunity to renew their entire plan through Dignity or Co-op by paying half the amount again.
Margaret and David (a former electrical maintenance engineer) took up the offer, paying one upfront with David’s pension and the second with Dignity’s monthly payment plan.
They said the company’s collapse had affected their monthly premiums, leaving them in a tenuous financial position.
“We never thought we’d be stuck with monthly payments again. We thought we were living comfortably. Now, we’re debt-free, but we’re broke. No money for snacks,” Margaret said.
They believe their health has suffered as a result.
As Margaret consoled him, David said in tears: “Ulcers and worry can get you into trouble and all these problems add up in the end.
“Sometimes you wonder, is this even worth going on? But you have to do it.”
Gill Marshall, a retired grandmother of four, paid £4,000 for a Safe Hands funeral plan.
Her husband Paul died suddenly in 2012 at the age of 57 while traveling in France.
The family had no plan, insurance, or adequate funds to pay for repatriation.
To get her husband home and arrange his funeral, Jill, from Grantham, Lincolnshire, had to borrow money and get a bereavement loan from the government, and nearly lost her home in the process.
“It was a really hard time and I didn’t want my kids to be put in that situation,” she said.
So for her funeral, Jill adopted the “Safe Hands” plan.
She gave the matter no further thought until she received a letter on September 19, 2022 informing her that the company had gone into receivership.
“Are you lost? Because the money is gone,” she said.
“You think you’ve been ripped off, but then not only do you not have a funeral plan, you don’t have the money to make another funeral plan.”
Safe Hands administrators FRP Advisory declined to comment on the situation.
But it has published four public progress reports since taking over management of the company.
In its latest report in May, administrators said it “will continue to pursue claims”.
The report noted that it had made “substantial progress in the process of reviewing claims brought by plan holders”.
But the company has not yet been able to refund any money to Safe Hands customers.
Before Safe Hands collapsed, there was no industry regulation as long as the funds were held in trust (which meant the funds would be carefully handled by the account trustee).
But by July 2022, all prepaid funeral companies must obtain approval from the FCA to operate.
Safe Hands filed an application, but the company subsequently withdrew its application and went into administration in March 2022 as it could not trade without regulation.
FRP Advisory told the BBC that the estimated payment to scheme holders was £70.6m, with expected returns of between £8m and £10.9m.
No repayment terms
The administrators’ progress documents show a series of financial transactions carried out before Safe Hands collapsed.
Of the tens of millions of dollars owed to plan holders, £45.1 million of investments were made in the Cayman Islands, which is not subject to British jurisdiction, the documents show.
In addition, the company’s previous owner, Malcolm David Milson, was granted a loan of around £3.5m in 2018. According to documents filed with Safe Hands on Companies House, the loan had no repayment terms.
The BBC invited Mr Milson to comment on the payment but he did not respond.
Lara Gee, a finance expert and associate professor of accounting at the University of Nottingham, said the company had plenty of time to get its finances in order to comply with the regulations.
She said: “Safe Hands itself was part of the original group of funeral plan issuers in 2017 where we came together to discuss the future of the industry and how it could be regulated.”
“With that in mind, you would expect that they would consider what the FCA might ask of them and that they would invest in the regulatory requirements so that they would be prepared, like many other providers.”
We contacted Mr Milson and Richard Philip Wells, two former owners of Safe Hands, to ask about the company’s financial situation, but they did not respond.
Consumer group Fairer Finance said it would push for a public inquiry under the new government.
The company said it had warned the Treasury and the Financial Conduct Authority about the financial situation of Safe Hands and the risk of its collapse as early as a meeting in 2017.
It argues that if the organisations had taken action, significant losses to plan holders could have been avoided.
The FCA said at the time that because Safe Hands was unregulated, its powers were limited.
Meanwhile, a Treasury spokesperson said: “Once concerns were raised about the funeral plan market, we banned the sale of prepaid funeral plans without authorisation from the Financial Conduct Authority to protect 1.6 million customers and their families.”
Responding to an ongoing investigation, the Serious Fraud Office told the BBC it had an “active criminal investigation into alleged fraud” involving Safe Hands and its parent company, SHP Capital Holdings Limited, which was currently underway.
The organisation has not yet revealed how long the investigation will take, which is of no comfort to people like Margaret and David who have suffered financial losses.
“To be honest, I think they want criminal prosecution,” Margaret added.
“They cause so much suffering to such a vulnerable age group.”
