House of Fraser customers who were promised refunds for undelivered goods in the wake of the department store’s collapse are to lose their money after its new owner, Sports Direct, reneged on the offer.
In August, six days after the Sports Direct founder, Mike Ashley, controversially paid administrators £90m for the department store group, House of Fraser told online customers that it was cancelling and refunding orders that were yet to be sent out.
However, this week the company said customers would have to join the long list of other unsecured creditors applying to the administrator EY for payment.
A spokesperson for House of Fraser said: “We cannot comment on individual cases, however the correct course of action for customers who have issues regarding goods purchased prior to 10 August is to contact the administrators at EY.”
The store group made its refund offer via its official social media channels on 16 August after customers expressed their anger that it had continued to take online orders while management staff had been discussing when to call in administrators. It said shoppers would receive an email in “a couple of days”.
Due to delays with delivering online orders, we have taken the decision to cancel and refund all orders that have not already been sent to customers. All customers affected will receive an email in the next couple of days. Please accept our apologies for any inconvenience caused.
— House of Fraser (@houseoffraser) August 16, 2018
In recent weeks, customers have used the store’s Facebook page and other social media sites to complain that they have not been contacted and/or received refunds.
Charlotte Kerr’s post on Facebook is typical: “It’s been nearly a month and I still haven’t heard anything, my emails are being ignored and my credit card company has told me that I have to keep pursuing a refund from HoF. Not sure how I’m supposed to do that when they’re ignoring all attempts to contact them.”
The promise of refunds came the day after House of Fraser shut down its website amid a dispute over payment between Sports Direct and XPO, the company that delivered online orders.
The website was expected to reopen this week after a deal was agreed with XPO, but was still closed on Thursday afternoon.
Shoppers who have tried to return faulty goods have found them returned by Royal Mail after House of Fraser’s warehouse refused to accept them.
Holders of the House of Fraser gift cards who were told to send them to a Glasgow office are still waiting to hear whether they will be replaced, as previously suggested.
Sports Direct has no legal obligation to refund orders made before House of Fraser went into administration.
EY said there was little prospect of customers awaiting goods receiving any money back from the administration process.
A spokeswoman said it could be a few pence for each pound spent, if that, and any payments would take at least 12 months. She suggested affected customers should be claiming from their card or payment providers first.
The Guardian has repeatedly asked House of Fraser to clarify its position on refunds, but the retailer has declined to respond.
Steve Nowottny, of MoneySavingExpert, said House of Fraser customers had been left in limbo.
“While there’s often confusion in this sort of situation, communication to House of Fraser customers has been particularly poor, with many unanswered questions over online orders, gift cards and return rights,” Nowottny said. “House of Fraser needs to act straight away to ensure that customers who have been left sometimes hundreds of pounds out of pocket are refunded immediately.”
Last week one customer who had ordered an undelivered sofa entered the Darlington store with friends and removed the sofa she had bought. Staff called the police, who pulled over her van as she drove home, but officers let her continue when she showed them the receipt.
