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Prevention

  1. We may identify contraventions of pensions legislation, or activity or risks, that can be prevented in the future, such as:
    • ongoing breaches of pensions legislation, including poor record keeping that could, if not resolved, result in additional breaches such as failure to pay contributions
    • scams and the misappropriation of scheme assets, which can have an immediate and catastrophic impact on an individual’s pension savings

Enforcement options

  1. Where prevention is our preferred outcome in relation to a breach, we may issue an improvement notice or a third-party notice. These notices can be used to set out the steps the person must take (or refrain from taking) to remedy the breach, but also to prevent the breach from being repeated.
  2. An improvement notice applies where a person, such as a trustee, is in breach of pensions legislation and can remedy that breach. However, the person may be in breach due to factors outside their control, for example failing to submit a funding valuation on time where this is wholly or partly the result of a failure by a third party, such as an employer or an actuary. In this situation we can issue a notice to that third party, requiring them to take steps to address the failure.
  3. Where we use these powers, we allow a reasonable amount of time to put measures in place to remedy or prevent a repeat of the non-compliance and require confirmation or proof that this has happened.
  4. If the non-compliance continues after the deadline given in the improvement or third-party notice has passed, we may impose financial penalties.
  5. However, we are unlikely to take this kind of action in cases involving scams or misappropriation of scheme assets. We take particularly seriously the actions or inactions of trustees which lead to the loss of pension savings. In these cases, we intervene to freeze and secure assets and disrupt the activities of those who prey on members. If necessary, we will suspend or prohibit those involved from acting as trustees and appointing an independent trustee to the scheme. We generally also pursue a criminal prosecution if there is evidence of fraud.
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