TPR suspends pension liberation scam trustee

21 Jun 2018

The Pensions Regulator has suspended Gordon Craig, a trustee for IFA firm Optimum Retirement Benefit Plans, following a police investigation into a £13.4m pension liberation scam.

Craig, who is currently being investigated by North West regional crime unit Titan, is accused of having transferred a total of £13.4m from the pension schemes of 288 people, with the promise that they could access part of their savings early.

The scam, known as pension liberation fraud, claims to offer members direct access to their pension money before the age of 55.

Members, who were in some cases convinced to hand over their money in cold calls,  subsequently received loans for up to 75% of their total funds and had to pay tens of thousands in fees to the adviser, the regulator disclosed.

The remainder of the funds was subsequently invested in high-risk, illiquid investments, including gem mining and olive oil processing.

Over the past 12 months alone, Craig had paid himself more than £500.000 from scheme funds.

Three other advisers at the firm have already been convicted of similar offences. Martin Dowd and Robert Winstanle have been jailed for money-laundering last year while Richard Jones was convicted of the same crime and given a suspended prison sentence.

The regulator has now appointed Dalriada Trustees to replace Craig and his colleagues at Optimum while the police investigation continues, in a bid to prevent other pension holders from transferring their funds into the scheme.

The crackdown on Optimum comes among increased public commitment by the regulator to intervene in order to prevent pension scams. Lesley Titcomb, chief executive at the regulator confirmed that the watchdog will increasingly target fraudulent schemes, if necessary for related offences such as misuse of computers, in order to prevent pension fraud.

The regulator also aims to intervene more proactively in pension scheme valuations, visiting schemes deemed to be high-risk several times a year in order to speak to both trustees and the employer, Titcomb announced during a speech at the Association of Member Nominated Trustees’ summer conference.

The 1995 pensions act gives the regulator the power to appoint independent trustees and to exclude existing trustees from acting on behalf of the scheme.

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