UK workplace pensions watchdog The Pensions Regulator (TPR) has fined a corporate professional trustee firm nearly £104,000 for breaching multiple areas of pension law. The penalty is the largest fine handed to trustees by TPR.
Kent-based Link Pension Trustees Limited was fined £73,750 by TPR’s independent Determinations Panel for failing to obtain audited accounts for the plan for four consecutive years, not providing members with Statutory Money Purchase Illustrations (SMPI) for two consecutive years, and for neglecting to report those six breaches of law to TPR.
In a separate action arising from the same investigation, the trustee of the master trust plan was also fined £30,000 by TPR for failing to have at least three trustees on a master trust board.
“These were breaches of several important statutory obligations, which had occurred over several years,” said the Determinations Panel in its ruling. “They deprived members of information and a level of protection regarding their pension pots,” it said, adding that “the Panel would have expected better of a corporate professional trustee, particularly one that had been warned about breaches of one of the same obligations in 2011-12.”
The plan provides pensions for 32 franchisees of McDonald’s restaurants, but is independent of the fast-food chain. It has 148 members, of which seven are active and 141 are deferred.
The breaches were identified through TPR’s engagement with all master trust plans in preparation for authorization and supervision. It is the first time TPR has used enforcement powers for the failure to provide members with SMPIs, failure to report breaches of law to TPR; and failure to have three trustees on a master trust.
“This case highlights how working more closely with master trusts as part of authorisation and supervision will expose any areas where the law is being broken and enable TPR to take action,” Nicola Parish, TPR’s executive director of Frontline Regulation, said in a release. “The good governance of pension schemes is closely linked to good outcomes for members.”
TPR said the trustee has resolved the breaches, paid the penalty, and the plan has triggered its exit from the master trust market.