The Pensions Regulator has responded to Mr Justice Morgan’s High Court ruling in respect of the legal status of a number of suspected pension liberation schemes.
In May, City of London Police carried out a series of raids on organisations accused of involvement in such schemes. Independent trustees were appointed to administer schemes suspected of involvement in pension liberation fraud. The High Court was asked to determine the legal status of these schemes in light of ambiguities in the documentation. Mr Justice Morgan has today ruled that the schemes are occupational pension schemes.
The regulator’s executive director for defined contribution (DC), governance and administration Andrew Warwick-Thompson commented:
“We welcome the legal clarity provided by this ruling, which will help inform our wider strategy and enable us to take the appropriate steps to combat activities that could undermine confidence in the pension system.
“The judge in this case has ruled that, on a literal interpretation of the scheme documents, these schemes were established as occupational pension schemes. This means that a number of powers are available to us in respect of such schemes, and the market should not doubt that we will continue to take action against schemes where there is evidence of misuse of members’ pots.
“We have a suite of powers we can use to disrupt pension liberation fraud including suspending and prohibiting trustees, appointing independent trustees to schemes to protect assets, freezing bank accounts and repatriating monies. The actions that we took in relation to these schemes still stand and the independent trustees put in place by us remain appointed.
“We advise the pensions industry to remain vigilant, to have regard to the ‘scorpion’ materials, and to carry out the necessary due diligence. This judgment does not, and should not, interfere with that position.”
The regulator was appointed by the court to argue that a number of the schemes concerned were not set up as valid occupational pension schemes.
Dalriada Trustees Ltd and Pi Consulting put the argument that the schemes to which they had been appointed as independent trustee were occupational pension schemes.
The parties involved in the legal proceedings were not in dispute. Both sides of the argument needed to be represented to help the court to reach its judgment.
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