Police Move In On £13m Suspected Pension Liberation Scam

Financial enforcers have suspended a trustee in an alleged £13.4 million pension liberation scam.

Trustee Gordon Craig is suspected as the mastermind behind the scam by The Pensions Regulator.

He has been thrown out of running the Optimum Retirements Benefits Plan after paying himself nearly £500,000 in a year and handing over tens of thousands in commissions to financial advisers recommending his scheme.

The regulator says Optimum was a ‘pension liberation scheme’ offering 288 retirement savers loans of up to 75% of their pension funds if they transferred to the scheme.

Pension rules prohibit anyone under the age of 55 years old from accessing their pension pots.

High risk investments

The funds that were not paid out were invested in high-risk offshore projects, such as mining gem stones and processing olive oil.

Two advisers involved with Optimum were jailed for money laundering offences, while a third received a suspended sentence from the courts.

“The permission of activity that appears to be pensions liberation strongly suggests that Craig, if he has the knowledge and skill of a pensions trustee, is not exercising it properly,” said the TPR determinations panel.

“Similarly, the highly illiquid and high-risk investments, several of which appear to have failed, is consistent only with Craig not having or exercising the necessary knowledge and skill.”

High commissions for salesmen

The panel heard that investors were urged to switch their pensions to Optimum by cold-calling salesmen paid high commissions by Craig’s firm.

The regulator explained that it was necessary to “protect other pension holders by preventing them from transferring their funds into the scheme”.

The determinations panel was also concerned that the Optimum trustees had breached their duties by keeping poor records and having limited knowledge of how the pension scheme should have operated.

Trustees have been appointed to run the Optimum scheme while police investigate allegations of fraud.

Optimum Financial Solutions, the sponsoring employer of the Optimum plan, was wound up in the public interest by the High Court in February following an investigation by the government’s Insolvency Service.

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