18.03.2024
The Fraud Compensation Fund (FCF) has made total compensation payments of £9.8m to three pension schemes, whose members’ pension savings were lost after being unlawfully invested in the former sole trustee’s own business, Norton Motorcycles Holdings Ltd.
More than 200 members will gain access to the pension benefits by the end of the month after Dalriada Trustees secured benefits for members via Standard Life using the compensation paid by the FCF. The FCF covers the financial loss from the scheme due to dishonesty, as well as scheme costs needed to investigate and progress the case.
Sara Protheroe, Chief Customer Officer, at the Fraud Compensation Fund said: “We’re very pleased that scheme members’ hard-earned pension savings have been rightly restored. This has been a complex and distressing case for scheme members, and we sympathise with those who have been waiting a long time for redress. We hope this is welcome news for all those who have been impacted by this case, and also provides reassurance to all members that we are continuing to make progress on existing claims.”
Tom Lukic, Director and Chair of the Dalriada Board, said: " Dalriada is delighted to have achieved this outcome for members of the Norton pension schemes. We understand how harrowing it is for those who believe they have lost their pension savings, and we are pleased to have been able to secure benefits for those members of the Norton schemes, as a result of the FCF compensation. The FCF is truly a life line for victims and this outcome gives reassurance to others in the same position, who have suffered uncertainty for a number of years, that there is now some light at the end of the tunnel.”
The compensation payment follows The Pension Regulator's (TPR) action against Stuart Garner, which resulted in a suspended jail sentence for employer-related investment breaches, and a determination by The Pension Ombudsman which upheld members' complaints of dishonesty and maladministration.
The Work and Pensions Select Committee opened an inquiry in 2023 to look at the lessons that could be learned from the Norton pension schemes case with the aim of ensuring members of pension schemes that experience losses due to dishonesty are better protected and supported in the future.
Due to the general election called in May, the Committee was unable to publish its report following the inquiry, however the former Committee Chair, Sir Stephen Timms, published a letter summarising the key points raised during the inquiry and possible areas for the new government to focus on.
Since November 2020, following a court ruling which clarified that occupational pension schemes set up as part of a scam were eligible for FCF compensation, the FCF has paid out around £50m in compensation to 28 schemes, and expects to receive over 100 further claims with a potential value of over £400m (as at 31 March 2024).
