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| Comet faces administration: know your rights | |
| (35 minutes later) | |
| High street retailer Comet is in trouble. Its chief executive Bob Darke has told staff that the troubled electricals retailer will enter administration next week, with Deloitte understood to be waiting in the wings to handle the process for the 240 stores. | High street retailer Comet is in trouble. Its chief executive Bob Darke has told staff that the troubled electricals retailer will enter administration next week, with Deloitte understood to be waiting in the wings to handle the process for the 240 stores. |
| Shoppers will be concerned that recent purchases might not be delivered. If you have a gift card – Comet sells them in amounts of up to £500 – you may be equally worried you won't be able to redeem it. | Shoppers will be concerned that recent purchases might not be delivered. If you have a gift card – Comet sells them in amounts of up to £500 – you may be equally worried you won't be able to redeem it. |
| So how can you shop confidently on the high street knowing you won't end up out of pocket if something goes wrong? | So how can you shop confidently on the high street knowing you won't end up out of pocket if something goes wrong? |
| Can I still shop in Comet? | Can I still shop in Comet? |
| Stores are still open, but the website is no longer taking orders, instead redirecting shoppers to a screen which says "comet.co.uk is currently unavailable". If you have vouchers, you would be well-advised to use them now, as in some previous cases retailers have refused to accept them once the administrators are brought in. | Stores are still open, but the website is no longer taking orders, instead redirecting shoppers to a screen which says "comet.co.uk is currently unavailable". If you have vouchers, you would be well-advised to use them now, as in some previous cases retailers have refused to accept them once the administrators are brought in. |
| If you are concerned about spending money in the stores, see below for details of how to protect yourself against future problems. | If you are concerned about spending money in the stores, see below for details of how to protect yourself against future problems. |
| Can I still shop in a store that has gone into administration? | Can I still shop in a store that has gone into administration? |
| In some cases you can – and there are often deals to be had as a retailer desperately tries to get rid of its stock to raise as much cash as possible – but you might not get your money back if an item later turns out to be faulty. | In some cases you can – and there are often deals to be had as a retailer desperately tries to get rid of its stock to raise as much cash as possible – but you might not get your money back if an item later turns out to be faulty. |
| I'm awaiting delivery of an item I've paid for – will I get it? | I'm awaiting delivery of an item I've paid for – will I get it? |
| Contact the retailer to see what stage your order is at – if it's ready for dispatch the company might still be able to fulfil it. If it cannot dispatch an item check to see if you can collect it from a warehouse or store yourself, providing there are still staff on hand to help. You'll need to take a receipt or proof of ID with you. | Contact the retailer to see what stage your order is at – if it's ready for dispatch the company might still be able to fulfil it. If it cannot dispatch an item check to see if you can collect it from a warehouse or store yourself, providing there are still staff on hand to help. You'll need to take a receipt or proof of ID with you. |
| What if it doesn't arrive or turns out to be faulty? | What if it doesn't arrive or turns out to be faulty? |
| If the company is unable to fulfil your order and you are unable to obtain a refund or replacement for a faulty item, you may be able to get your money back depending on how you paid: | If the company is unable to fulfil your order and you are unable to obtain a refund or replacement for a faulty item, you may be able to get your money back depending on how you paid: |
| If you paid by credit card You are covered by Section 75 of the Consumer Credit Act. This makes the credit provider jointly liable with the retailer for anything you buy, provided the item costs between £100 and £30,000. This also applies to anything bought with a credit agreement through a store, so if you sign up for an interest-free credit deal you are still covered. | If you paid by credit card You are covered by Section 75 of the Consumer Credit Act. This makes the credit provider jointly liable with the retailer for anything you buy, provided the item costs between £100 and £30,000. This also applies to anything bought with a credit agreement through a store, so if you sign up for an interest-free credit deal you are still covered. |
| The protection covers undelivered goods and those that prove to be faulty, and you only need to have put the deposit on your card, not the whole cost. | The protection covers undelivered goods and those that prove to be faulty, and you only need to have put the deposit on your card, not the whole cost. |
| Should you need to make a claim, Citizens Advice has a template letter you can download and send to your credit card provider. Bear in mind, the cover does not extend to items paid for with credit card cheques. | Should you need to make a claim, Citizens Advice has a template letter you can download and send to your credit card provider. Bear in mind, the cover does not extend to items paid for with credit card cheques. |
| If you bought goods on other plastic You may have some protection. Visa, MasterCard and American Express all offer a scheme called chargeback, which allows customers to claim back money spent on a debit or prepaid card if the goods do not arrive or are faulty, or where the retailer has gone bust. There are time limits for these claims, so you should act as soon as you can. See our factsheet for more on Section 75 and chargeback. | If you bought goods on other plastic You may have some protection. Visa, MasterCard and American Express all offer a scheme called chargeback, which allows customers to claim back money spent on a debit or prepaid card if the goods do not arrive or are faulty, or where the retailer has gone bust. There are time limits for these claims, so you should act as soon as you can. See our factsheet for more on Section 75 and chargeback. |
| If you paid by cash or some other means You will have to contact the administrators to make a claim directly. Details of who it is are usually posted on the ailing firm's website or should be listed at Companies House or the Individual Insolvency Register for sole traders or partnerships. | If you paid by cash or some other means You will have to contact the administrators to make a claim directly. Details of who it is are usually posted on the ailing firm's website or should be listed at Companies House or the Individual Insolvency Register for sole traders or partnerships. |
| You should do so immediately to inform it about the disputed purchase, although there is no guarantee you will get your money back. A company in administration will have a long list of creditors and it is the administrator's role to decide how much cash the company has to be distributed, which creditors are first in line, and how much each creditor will receive. | You should do so immediately to inform it about the disputed purchase, although there is no guarantee you will get your money back. A company in administration will have a long list of creditors and it is the administrator's role to decide how much cash the company has to be distributed, which creditors are first in line, and how much each creditor will receive. |
| Are all gift vouchers worthless if a company is in administration? | Are all gift vouchers worthless if a company is in administration? |
| Pretty much. It makes sense to try to spend a voucher as soon as you can once you learn a retailer is in trouble, as vouchers tend not to be accepted once a company is in administration. If you have unspent vouchers you need to lodge a claim with the administrators and hope for the best. | Pretty much. It makes sense to try to spend a voucher as soon as you can once you learn a retailer is in trouble, as vouchers tend not to be accepted once a company is in administration. If you have unspent vouchers you need to lodge a claim with the administrators and hope for the best. |
| I bought vouchers using a credit card. Am I protected? | I bought vouchers using a credit card. Am I protected? |
| Section 75 means that buying with a credit card usually offers you protection when a company goes bust, assuming you have spent more than £100. But the situation with vouchers is more complicated. | Section 75 means that buying with a credit card usually offers you protection when a company goes bust, assuming you have spent more than £100. But the situation with vouchers is more complicated. |
| If there is no third party involved then you could be effective in making a claim. So, if you buy vouchers directly from a store to spend in that store you would be entitled to your money back if that store went bust (remember, this only applies if you've spent more than £100 using your credit card). However, if you used a third party such as a website that sells vouchers on behalf of a number of stores, you could not make a claim. | If there is no third party involved then you could be effective in making a claim. So, if you buy vouchers directly from a store to spend in that store you would be entitled to your money back if that store went bust (remember, this only applies if you've spent more than £100 using your credit card). However, if you used a third party such as a website that sells vouchers on behalf of a number of stores, you could not make a claim. |
| Check out our factsheet on using Section 75 and the Chargeback facility for more information. | Check out our factsheet on using Section 75 and the Chargeback facility for more information. |
| Will the guarantee I bought with my product still work? | Will the guarantee I bought with my product still work? |
| Yes. Manufacturers often provide their own guarantee, while longer-term guarantees and warranties are usually underwritten by a third party, which will be legally required to honour contracts regardless of what has happened to the retailer who originally sold the product. In Comet's case, for example, its guarantees are underwritten by The Warranty Group. | Yes. Manufacturers often provide their own guarantee, while longer-term guarantees and warranties are usually underwritten by a third party, which will be legally required to honour contracts regardless of what has happened to the retailer who originally sold the product. In Comet's case, for example, its guarantees are underwritten by The Warranty Group. |