The Pensions Regulator has intervened in a case where 242 members from 17 pension schemes are believed to have lost around £13.7m to a scam.
In a final notice published today, TPR says three trustees – Alan Barratt, Susan Dalton and Julian Hanson, acting on the instructions of David Austin – misappropriated scheme funds.
Dalriada has been appointed as an independent trustee to take over governance of the funds in an attempt to prevent further losses.
TPR says Dalriada has managed to reclaim £400,000 so far but “for many hundreds of members, hard-earned savings have most likely been lost”.
According to the report, Barratt and Dalton were the trustees of nine and seven occupational scheme, respectively.
Austin is listed as the sole shareholder of Friends Trustee Limited, which registered the Friendly Pensions Retirement Fund as a master trust.
The regulator found evidence Barratt and Dalton received “large sums of money” into their personal accounts.
This includes cheques worth £37,000 paid to Dalton from the Regency Pension Investment schemes in June 2013, and £10,000 sent to Barratt from the Callahan Consulting scheme in January 2014.
In addition, both trustees received commission in breach of their fiduciary duty not to profit from the trust.
Documents for both trustees appear to show entitlement to 20 per cent commission of the profit made by Select Pension Investment.
Dalriada and the regulator have also noted “highly suspicious” payments, including £4m paid to the Friends Investment Company.
TPR executive director Andrew Warwick-Thompson says: “This complex case bears many of the hallmarks of a pension scam and should be seen as another reminder of why savers must remain vigilant against the threat of scams, which have a devastating impact on people’s lives.
“Our appointment of an independent trustee has helped secure approximately £400,000 from the schemes, however for many hundreds members, hard-earned savings have most likely been lost.
“Our message is clear: if you’re cold-called or texted by people claiming they can help you to get early access to the cash in your pension or unusually high investment returns, stop, don’t be tempted, and put the phone down. You’re likely to lose all your money and may face a considerable tax charge.”