Four UK company directors have collectively been disqualified for 34 years for various failings linked to the transfer of pension funds.
The Insolvency Service released details on Wednesday of its investigation, which centred on the conduct of the directors connected with Gibraltar-based Transeuro Worldwide Holdings (TWH), which was wound up in 2015.
Encourage transfer network
TWH helped fund two introducer firms, Sycamore Crown and Jackson Francis, which cold-called members of the public to encourage them to transfer their pension pots into self-invested personal pension (Sipp) plans and other pension schemes.
The Sipp and pension schemes were operated by Omni Trustees and Imperial Trustee Services, which provided trustee and administrator services for two occupational schemes – Henley Retirement Benefit Scheme (HRBS) and Capita Oak Pension Scheme (Cops).
Investigators found that introducers from Sycamore and Jackson Francis misled clients about their expertise and experience.
They also offered “guaranteed” returns designed to encourage clients to transfer.
In total, £57m ($74.9m, €63.7m) was transferred, with more than £39m paid into the Sipp scheme, over £10m into Cops and in excess of £8m in HRBS.
The funds were largely put into unregulated investments in storage units, which ultimately did not yield the level of returns promised to members.
Omni and Imperial are currently the subjects of an ongoing investigation by the Serious Fraud Office.
Disqualifications
The most recent disqualification was for Stephen Talbot, a director of TWH.
He was banned for nine years for failing to ensure that TWH maintained or delivered adequate accounting records.
As a result, it has not been possible for investigators to ascertain whether payments of more than £37m from the firm’s bank account were for a purpose connected with the business.
Additionally, they cannot explain why over £740,000 was paid to Talbot or why £7.5m was paid to a Panamanian foundation for which Talbot was protector.
The records also do not show commission due to, or received from, the company or show the nature of receipts into TWH.
Talbot’s ban follows three others involved in the case.
Stuart Grehan, director of Sycamore, agreed to a nine-year ban as a result of false and misleading statements to encourage investors to transfer their pension pots.
Karl Dunlop, director of Imperial, and Ian Dunford, director of Omni, both agreed to voluntary bans of nine and seven years, respectively.
They failed to act in the best interests of pension members and subsequently failed to ensure investment were adequately diverse.
As a result, none of the men listed above can act as a director of a company; take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership or be a receiver of a company’s property for the duration of their respective disqualifications.
An increase in cases
Ken Beasley, official receiver for the Insolvency Service’s public interest unit, said that, unfortunately, he has seen an increase in cases where members of the public have been persuaded to transfer their hard-earned pension pots on the basis of unsubstantiated promises of higher returns, which inevitably never materialise.
“You may have seen the current campaign by the Financial Conduct Authority, where they recommend that you reject unexpected offers, especially those originating from a cold call,” he said.
“You should check who you are dealing with, avoid being rushed or pressured into making decisions and seek out impartial advice before going ahead with any pension transfer.
“Suspicions should also be raised if you are promised high or guaranteed returns, unusual investments or complicated structures, high-pressure sales tactics, involvement of several parties, all taking a fee which significantly cuts into your pension pot, and long-term pension investments which could take years before you realise something is wrong,” Beasley added.
