TPR bans pension trustees after suspected pension scam
The Pensions Regulator (TPR) has banned two trustees of the London Quantum pension scheme for transferring funds into high risk and suspected scam investments.
Stephen Alexander Ward and Anthony Salih have been banned from acting as trustees after they allowed millions of pounds of transferred funds held in their trust to be put into exotic, high risk and suspected scam investments, including eucalyptus farms, hotel rooms on an African island and car park bays.
TPR’s determinations panel said both men lacked the competence and capability to be trustees, and described Ward as reckless and lacking in integrity.
They were warned they could be jailed if they act as a pension scheme trustee in the future.
Between April 2014 and June 2015 hundreds of people were approached by introducers being paid commission to persuade pension savers to transfer their funds to London Quantum.
More than 90 people transferred their pensions, worth over £6m, to be invested in the exotic propositions without their knowledge. From this, hundreds of thousands of pounds were paid out to Dorrixo, to introducers and to an administration and marketing services firm.
The regulator deemed Ward’s behaviour to have been reckless and said he had demonstrated a lack of integrity, as he had failed to investigate an inappropriate employer-related investment that should have been obvious to him as a professional trustee.
It also found he had a serious lack of competence and capability to be a trustee. Ward did not appeal his ban.
TPR’s panel also alleged that Salih lacked the competence and capability to be a trustee.
Salih launched an appeal in February to the Upper Tribunal against his prohibition, but abandoned this seven months later, ahead of a hearing. TPR had made clear throughout the process that it would defend its case against Salih robustly.
TPR’s concerns over the security and quality of the investments and the governance and administration of the scheme led to the regulator’s appointment of Dalraida Trustees Limited as an independent trustee to the exclusion of Dorrixo, it said.
“Ward and Salih put millions of pounds of other people’s money at risk and have neither the knowledge nor the skills needed to run a pension scheme,” TPR executive director of frontline regulation Nicola Parish, said.
“Trustees play a vital role as the first line of defence for pension schemes but these two men allowed huge sums to be invested into high risk, exotic investments that bear all the hallmarks of being scams,” she added.
TPR and FCA joined forces in August to launch a new national awareness campaign about pension scams.