The Pensions Regulator now has new criminal powers to prosecute people and organisations that put pension savers investments and accrued benefits at risk.
The new powers were granted in the Pension Schemes Act 2021 that is now in force. The act now makes it a criminal offence to put pension savers investments at risk rather then a civil offence. Criminal law allows the court to punish for any offence e.g. prison term sentences and fines whereas civil law allows for financial redress or compensation to awarded to the injured party.
The new powers are a clear warning to employers, pension scheme trustees, pension scheme administrators and fund managers.
Criminal Act Offences
The Pensions Regulator has confirmed it is not looking to prosecute or jail people for day to day activities, human error or mistakes but it will take action with perpetrators that intentionally commit ‘wrong doing’ or are reckless in their conduct.
It is hoped that the new powers will act as a deterrent to discourage any intentional wrong doing as we have seen in a couple of high profile cases recently where scheme trustees and administrators have stolen pension funds or businesses that successively declare profits, dividends or pay ‘fat cat’ salaries and bonuses just before firms go into liquidation after building up huge pension deficits.