Deathwatch - 1,800 Empire Direct Customers Lose Cash

27 January 2009

Rotten news for some 1,800 Empire Direct customers who became creditors when the company went into administration recently – they’re unlikely to get their money back.

That’s according to administrator KPMG, who announced that a total of 5,800 customers had orders outstanding with Empire Direct when KPMG were called in last week.

About 4,000 of those customers had paid by a credit card and would almost certainly be able to claim their money back from their card supplier, but it looks like bad news for the remainder who will almost see their cash flushed away with the company.

(Thanks to Bitterwallet reader Daniel Austin)

TOPICS:   High Street News

29 comments

  • Crash G.
    An ode to gordon brown, crash gordon... Crash - a-ah - failure of the UK purse Crash - a-ah - he'll screw everyone of us Ha ha ha ha ha ha ha ha ha Crash - a-ah - preying for a miracle Crash - a-ah - king of the imlplausible Spend for everyone of us Ignore everyone of us He'll take with a mighty hand Every man every woman Every child - with a mighty tax Crash - a-ah Crash - a-ah - he'll screw every one of us
  • mark s.
    I had 2 orders with them before Xmas I received one and got a refund on the second when it did not arrive in the first week of January. So glad I could have lost over £800.
  • Mac P.
    Bad news for the 1,800 customers concerned. In these times I think it would be prudent to treat any company where you have to pay up front with caution - always use a credit card.
  • graham m.
    i paid for a plasma tv on 20th december 08 paid cash as i don't have a credit card the tv never arrived so i lose 1000.00 pounds and no tv i feel so discusted with the company and know its going to take a long tome before i'm able to save to buy another tv
  • Amanda H.
    Mr Mac Jones, I have clicked on your site numerous times, but have still not received my order of 23 Playstation 3's and 17 Xbox 360's. Could you give your courier a nudge. It is so nice to find a website that offers free consoles with no catches. Amanda Hugginkiss
  • Wyliekid
    if you paid by a Visa debit card you can be coverd by the same guarantee as a the visa credit card (i.e over a 100 squid).... cant remember for the life of me what its called thou,
  • Joff
    Mr Mac Jones - Can I have an iPod touch please. Any chance it can be pre-loaded with both of Aqua's albums (Aquarium and Aquarius) and also some stuff from Lene's solo career, I'll let you choose which as you're doing me a favour. Much appreciated boss.
  • Fred C.
    Beware of any company which had a heritage original of another bigger company. Empire Direct was a subsidiary company set up by Legal and General Insurance. Such companies are set up as shell company with no assets and is essentially hollow company. The subsidiary is spun off and sold usually when the parent company has maximised its investment from me and can gain no further benefit from any significant increaese in future profits. Therefore the subsidiary, once on its own, has to survive on a profit margin at the time of sale. Any significant drop in profit and revenvue will kill it off straight away.
  • Honky S.
    While I accept what you're saying Fred Chan - surely being part of Legal & General would have meant Empire Direct never going bust. This recession is getting hard to understand...
  • mum2oneplustwins
    Good point......... are some companies using some sort of loophole to go conveniently "bust"?......
  • Ryan
    What Fred is saying is Empire was started by L&G but then once L&G felt the business growth had been maximised they sold the company, presumably a management buyout or some other private investment, which loaded the company with debt as it in effect had to 'buy itself'. The money used by Empire to buy freedom from the parent company would of been secured against future sales and profits etc, now the recession has started hitting these sales and profits Empires creditors want their money back as they don't think the business is viable at its current and projected sales levels, i.e. they think they can make more money with a lower chance of default by lending the money to a different company.
  • Yaser88
    they've still got their thieving mug on billboards. for all those that lost substantial cash, go to tthe owners house, i'm sure he can sell his house(s) to repay the customers he's robbed.
  • Fred C.
    Thanks "Ryan" in your elaboration. I am trying to help people here to save money as sure more companies will go bust suddenly. Those people who paid less than £100 on the credit card will not be protected by the Consumer Credit Act 1974. So to extend my concept further online electrical companies which have been founded on a proper footing with sound enterprise are and the online shop is still part of the core business: John Lewis Partnership, the online arm is still part of John Lewis. BT online shop which is still attached to BT PLC http://www.shop.bt.com/homepage.aspx . Other totally online electrical which are relatively stable are the mail order companies on the channel islands e.g. play.com. Another illustration on my principle source of business failure is Zavvi which had a heritage of Our Price/Virgin business, a management buy-out led to the rebranding as Zavvi. Management buy-outs are high risk companies will little or no assets in the company as they are stripped off of assets and their gearing and debt are much higher.
  • Yaser88
    this company looks strikingly similar
  • Yaser88
    this company looks strikingly similar http://www.electrosaver.co.uk/
  • Fred C.
    As to your statement "mum2oneplustwins", I am afraid many companies are at the whimp of their creditors. The creditors will look closely on the "worth" of the company in the current trading environment. If they see their credit to the company is looking to be threated by the declining worth of the company they will make the company bust quickly and grab at their amount owed rather than to let situation drift. They have no feeling for any possible ethics and possible future earnings as these are risky in risky times and they certainly have no social responsibility. This is why at these trouble times the world leaders are once again reading Karl Marx's books for wisdom thought not suggesting communism is the solution but as a sense check on free market capitalism!
  • Fred C.
    As a further tip, don't buy anything from a company with a cash back offer unless the company is really stable. As when the company goes bust you will end up with no cash back and still paying for monthly bills, e.g. mobile phone cash backs.
  • OFI
    Argh I hate the way it is getting to the point where we MUST use a credit card. I have never wanted one because I didn't want to get into debt and I have enough of my own money I can spend using my debit card. But with more and more people happily ready to scam you and more businesses going under, spending other peoples money is looking to be the only safe option. Why can't we have similar cover for debit cards :-P Wonder if I would even be accepted on a new credit card now, probably not the best timing to apply.
  • liam
    Firstly, I'm seriously very sorry to hear about anyone that has paid for something and not received the goods. but here's my question.... my brother bought his tv from empire direct and took out the pay monthly option. he received the tv in december and has made his first payment. does he still have to continue making the payments? Surely if they won't give customers stuff they have paid for, he shouldn't have to pay for stuff he has received...
  • Saftlad
    Liam, your brother will still have to continue the payments. EmpireDirect (like so many other companies) don't do the credit themselves, but farm it out to credit companies. So, your brother actually owes someone else the money, not EmpireDirect who would have got their money as soon as your brother signed on the dotted line.
  • Curved S.
    Liam, unfortunately I think he will, as it's not EMPIRE he owes the money too, it's the company he took the credit out with, they paid Empire when he bought the TV
  • Mike H.
    What was up with that comment Mr Mod? I was trying to help Liam out
  • Joe B.
    Something that I have heard about - The bank that Empire Direct used refused to increase their overdraft by one million even though some of the managers had put their homes up as collateral. Not only did they decline the increase, but they then reduced their overdraft by 2 million. There was enough money in circulation in cheques etc, but they couldn't wait for these to clear etc. It is the banks that cause these problems!
  • DG
    I bought a Washing Machine form them and elso the edExtra Card which gave 3 years gurantee with the product. Now since th ecompany has gone bust. will have to rearrange warrantee with some other company. Those who got edExtra card.. Beware !!!
  • Gareth E.
    Fred Chan is completely wrong about BT Shop. It is a sister website of Dabs.com, which has a BT front end. All orders are fulfilled by Dabs - not BT.
  • Mars
    Gareth Evans - BT bought Dabs.com!!!
  • Former E.
    Fred Chan is completely wrong about Empire Direct, it was set up by two pairs of brothers over 25 years ago and was still owned and managed by the four when t went into administration last month. L&G were a small client of one of Empire's businesses (I know as I worked there). Apparently, and the full administrators report bares this out if you read it, the business was well run and cash rich until as little as 4 months ago and it was the withdrawal of credit insurance that happened then that did for ED.
  • Feckers
    Empire Direct are no way near as bad as Sorroco Direct. At least these guys supplied something; the SD rip off merchants didnt supply anyone. Lesson is "be wary of dodgy geezers" selling cheap goods.
  • KJ
    Anyone who has paid by Visa Debit Card will be covered under the chargeback Visa guarantee.........

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