Every industry can become victim to scams and the pensions world is not excluded.  The Pensions Regulator released a warning to savers to remain aware of the on-going threat of scams while explaining the details of a recent £13.7m pensions theft.

Three trustees were acting on third party instruction from David Austin and were all deemed by TPR to have misappropriated scheme funds.  TPR also explained how these trustees exercised extremely poor trustee governance.

Austin was described in the report as acting “as a shadow trustee in control of the funds paid into a number of pensions schemes.”  Upon investigation, TPR believes there was foul play to the tune of £13.7m, which has mysteriously disappeared.  This lump sum of money belonged to approximately 242 members.  The £13.7m includes fees and commission payments.

The regulators’ Determinations Panel appointed an independent trustee to administer 17 pension schemes in order to prevent any more loss and to help claim back some of the funds.

Human resource experts are urging savers to be cognizant of warning signs that could indicate a potential scam.  The list includes things like mass marketing techniques, suspicious activity like fund transfers, incentives for lump sum payments or incentives for transfer completions and lack of documentation.

While the case of this scam and its details are certainly devastating for those involved, HR experts hope that it can serve as an example and a reminder as to why vigilance and attention to savings is so important.