Editorial: Put fraud firmly in the shade

Andrew Warwick-Thompson, the regulator’s DC governance director, had previously told Pensions Week it was gearing up to attack two pension liberation models in the courts.

In the case that has been adjourned until autumn, the regulator along with Dalriada Trustees and Pi Consulting argued that a number of schemes concerned are not valid pension funds.

Warwick-Thompson told Pensions Week: “If we are successful in taking down that model, then the whole of the law enforcement industry can say those are sham schemes and move in to take them down.”

And with further news last week that Nest was the victim of £1.4m fraud by a supplier, it seems fraudulent activity is coming from both directions.

Barry Gibb, a partner in the pensions team at law firm Hill Dickinson, says it is a dent to Nest’s reputation in the early stages of auto-enrolment.

Employers should be questioning whether their pension providers have the necessary checks in place against this type of fraud, he says.

Gibb recommends providers have a principal point of contact in the scheme that should be alerted if transfer requests are made. “It is about putting in further levels of protection,” he adds.

Warwick-Thompson said he doesn’t expect an end to fraudulent activity and the large pots of money pensions represent are tempting.

Pension fraud is certainly turning out to be a key pensions story of the year. As the print version of Pensions Week prepares for its summer holiday, on pages 9-11 we take a look back at other major stories from the year so far.

It became clear as auto-enrolment took hold that DC would dominate; low opt-out rates were of keen interest while the growth of mastertrusts led to questions around governance.

Lisa Botter is deputy editor of Pensions Week. You can follow her on Twitter @l_botter and the team @pensionsweek