The Pensions Regulator has suspended a scheme trustee after detectives from an elite crime unit launched a fraud investigation over allegations about his role in a scam.
Gordon Craig is the subject of an investigation by Titan, the North West regional organised crime unit, in connection with his role as a trustee of Optimum Retirement Benefits Plan and other pension schemes.
The watchdog’s determination panel decided it is “overwhelmingly in the interests of scheme members and for the protection of scheme assets” for Craig to be suspended from acting as a trustee on any scheme while the investigation continues.
It also appointed Dalriada as an independent trustee to Optimum to protect other pension holders by preventing them from transferring their funds into the scheme.
From 2015, a total of £13.4m was transferred to Optimum from the pension schemes of 288 people.
In some cases members were cold-called to persuade them to transfer their pensions and introducers were also paid tens of thousands of pounds in fees.
After members transferred their pensions to the scheme, they received loans from companies linked to Craig for as much as 75 per cent of their funds.
The remaining funds not paid out as loans to members were then invested in high-risk, illiquid investments including gem-mining and olive oil processing.
Craig who is an insolvency practitioner paid himself nearly £500,000 from scheme funds in just 12 months.
The determinations panel noted a number of people involved in the setting up or running of Optimum and linked schemes had been convicted of dishonesty offences.
Two – Martin Dowd and Robert Winstanley – were jailed for money-laundering while a third – Richard Jones – was convicted of the same crime and given a suspended prison sentence.
The panel was also concerned Optimum trustees had breached their duties by keeping poor records and having limited knowledge of how the pension scheme should have operated.
In its determination notice on the appointment of an independent trustee to the scheme, the panel said: “The permission of activity that appears to be pensions liberation strongly suggests that Craig, if he has the knowledge and skill of a pensions trustee, is not exercising it properly.
“Similarly, the highly illiquid and high-risk investments, several of which appear to have failed, is consistent only with Craig not having or exercising the necessary knowledge and skill.”
Optimum Financial Solutions, the sponsoring employer of the Optimum plan, was wound up in the public interest by the High Court in February following an Insolvency Service investigation.