Are we safe in their hands?

Two men behind the collapsed funeral-plan firm Safe Hands have been charged with conspiracy to defraud. This is four years after it went bust, leaving 46,000 customers with losses of £70m.

At a Magistrates Court hearing, the Serious Fraud Office barrister told the judge that Richard Wells, 39, and Neil Debenham, 43, planned to “enrich themselves” by arranging for money to be sent to the Cayman Islands and routed back so they could take control of it. She added: “Nobody would have sought to buy a funeral plan had they known the money was going to be used this way.”

The firm was put into administration just four months before funeral plans began to be regulated by the Financial Conduct Authority. The administrators only managed to recover about 4p in every pound given to the firm, so around 96% of the money has disappeared. Some customers have reported their plans cost many thousands of pounds but have now received a final cheque for just a couple of hundred or so.

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Since the FCA began to regulate funeral plans, on 29th July 2022, such spectacular failures are very unlikely – and if one did collapse, customers are protected by the Financial Services Compensation Scheme. I am still not convinced they are good value for money, however. You pay a firm for your funeral while you are alive and it guarantees to provide the funeral you have chosen however long you live and however much costs have risen. But the plan will not cover everything. Embalming, some cremation costs, a second mourners car, recovering your body if you die a long way away and many other extras may still be charged for. Many plans are sold on an instalment plan, but that will cost more, and if you die too soon the cost may not be covered.

If you’re tempted to buy a plan, make sure you understand exactly what it does and does not cover, and decide with your relatives if it’s a good idea. Alternatively, pay money into a high-interest savings account labelled ‘funeral’ and leave relatives details of what you would like.

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NB Sub: PL changed last sentence of copy after the last day in court:

Wells and Debenham pleaded not guilty at Southwark Crown Court and were released on bail with a trial expected in October 2028.