Timms quizzes PPF and TPR on compensation ruling implications

The Pensions Regulator (TPR) and Pension Protection Fund (PPF) have been asked to clarify the circumstances in which pension savers can receive compensation, in a letter from Work and Pensions Committee (WPC) chair, Stephen Timms.

The letter acknowledged that the High Court ruling in Board of the PPF vs Dalriada meant that many members of pension schemes used as a vehicle for a pension fraud could now be eligible for compensation, but added that there was additional uncertainty around cases, such as Salmon Enterprises, where no independent trustee was appointed.

As such, Timms asked the two organisations whether schemes with no trustee and no identifiable assets continued to exist as entities that could make a claim on the Fraud Compensation Fund (FCF).

It also asked whether TPR would revisit any decisions not to appoint independent trustees for schemes which might now be eligible for compensation from the FCF, as well as whether the PPF was engaging with schemes which could be eligible for compensation from the FCF, but had no trustees.

Finally, the letter questioned if the PPF had included schemes without trustees in its estimated £350m in compensation payments to be claimed as a result of the High Court judgment.

A judgment in relation to the case was handed down in November 2020, with Mr Justice Trower determining that a significant number of pension schemes could, in principle, make applications to the FCF.

Pension Scams Industry Group (PSIG) chair, Margaret Snowdon, warned that the ruling could have a “huge impact on pension liberation cases”.

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