Minister demands Treasury answers on First Solution’ collapse
GOVERNMENT minister Jim Fitzpatrick is demanding answers from the Treasury today on what has happened to those hit by the aftermath of the First Solution money transfer firm that went bust three years ago. His constituency is at the heart of East London’s Bengali community which was devastated by the collapse
GOVERNMENT minister Jim Fitzpatrick is demanding answers from the Treasury today on what has happened to those hit by the aftermath of the First Solution money transfer firm that went bust three years ago.
His Poplar & Canning Town constituency is at the heart of East London’s Bengali community which was devastated by the collapse in 2007.
Most of its savers were workers sending home their earnings to family in Bangladesh when the money-transfer firm collapsed, owing �1.7 million to its 2,000 customers.
Mr Fitzpatrick is asking what has happened to those who suffered financial loss in the aftermath, in a letter to Treasury Economic Secretary Ian Pearson.
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He says in the letter: “I understand that First Solution’s directors have been banned from running companies for a number of years, that the company’s liquidators tried to raise money by changing its name to XTL and selling this on, without any success, that XTL has not yet been struck off the company register, but to all intents and purposes no longer exists.
“However, the outcome for First Solution’s customers is unclear. People lost substantial amounts of money and were left in a desperate and parlous situation.”
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The after-effects of First Solution’s collapse were felt long after the events of 2007, he points out.
The collapse led to protest marches and a rally at Whitechapel and even a lobby of Parliament during that summer of discontent.
First Solution Money Transfer Ltd had its main office at the London Muslim centre in Whitechapel when it went under. It had mushroomed in just 12 months into a European network of 80 agents, but ceased trading in June that year. MP George Galloway’s Bethnal Green & Bow constituency office was beseiged by worried savers.
First Solution was run by four directors, who blamed media-fuelled rumours’ for sparking a run on the company, which they said had forced it towards liquidation.