The head of a charity has been ordered to pay £6,500 for refusing to give information linked to an investigation into unusual scheme investments to The Pensions Regulator (TPR).
Patrick McLarry, the Chief Executive of Hampshire-based Yateley Industries for the Disabled Limited, failed to provide the required documents to TPR despite being pursued for them for over 18 months.
Mr McLarry, a former trustee of the charity’s pension fund, was issued with an information notice for the documents in July 2015. He refused to supply them, claiming that as the documents contained third party information, supplying them would be a breach of French privacy law. He also said that the bank statements* were protected by legal privilege, and subsequently claimed that he was refusing to provide them on the basis that they might incriminate him.
TPR decided that the failure to hand over the documents was sufficiently serious that it merited the prosecution of Mr McLarry – only the second time it has taken such action.
Mr McLarry pleaded not guilty to refusing to produce, without reasonable excuse, documents required under section 72 of the Pensions Act 2004, which is an offence under section 77 of the Act, but he was convicted of the offence at Brighton Magistrates’ Court. TPR engaged an expert in French law to give evidence on its behalf, following which the court agreed that Mr McLarry had been wrong not to comply with the information notice.
Finding Mr McLarry guilty and ordering him to pay a £2,500 fine, £4,000 costs, and a £120 victim surcharge, District Judge Christopher James said he had imposed a significant financial penalty to reflect high culpability. The harm caused by Mr McLarry’s actions was unknown but the consequent elongation of TPR’s investigation has caused delay and an increase in costs.
He also commented that TPR carries out a very important regulatory function and section 72 of the Pensions Act 2004 is an important investigative tool for TPR.
Nicola Parish, TPR’s Executive Director for Frontline Regulation, said: “Patrick McLarry refused to co-operate with TPR staff and gave a number of excuses which were rejected by the court. This was a clear case of him deliberately refusing to comply with the law.
“Legal action could have been avoided if Mr McLarry had simply complied with the legal notice.
“This is another example of how we will use our powers to take action against individuals who hamper our investigations into the management of pension schemes.
“Refusing to comply with a legal request from The Pensions Regulator will not be tolerated.”
*The bank statements requested were from a French bank account in the name of Mr McLarry and his wife that Mr McLarry had access to.
- TPR has the power under section 72 of the Pensions Act 2004 to require pension schemes, employers and third parties to provide us with information and documents relevant to our statutory functions.
- Failure to provide such information is a criminal offence which can result in an unlimited fine. Additionally, those involved can suffer serious reputational damage from being successfully prosecuted for non-compliance with the law. Businesses and professionals could also face further action from their professional body.
- TPR is the regulator of work-based pension schemes in the UK. Our statutory objectives are: to protect members’ benefits; to reduce the risk of calls on the Pension Protection Fund (PPF); to promote, and to improve understanding of, the good administration of work-based pension schemes; to maximise employer compliance with automatic enrolment duties; and to minimise any adverse impact on the sustainable growth of an employer (in relation to the exercise of the regulator’s functions under Part 3 of the Pensions Act 2004 only).