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Pensions: More durable jail phrases for mismanaging funds

Work and pensions secretary Amber RuddPicture copyright
EPA

Firm executives might resist seven years in jail in the event that they mismanage worker pension schemes.

Work and Pensions Secretary Amber Rudd has proposed a brand new prison offence for “wilfully or recklessly” mismanaging funds.

Plans outlined final yr for a most sentence of two years in jail had been toughened up after public session.

Writing in the Sunday Telegraph, Ms Rudd mentioned the regulation will goal “the reckless few enjoying quick and unfastened”.

“For those who run your organization pension into the bottom, saddling it with large, unsustainable money owed, we’re coming for you,” she mentioned.

She mentioned present guidelines imply that “acts of astonishing vanity” by a couple of firm administrators are punished with fines “that hardly dent bosses’ financial institution balances”.

Underneath the brand new regulation, courts would even be given the ability to levy limitless fines for mismanagement of pensions.

Dodge accountability

The proposal follows requires reform after one of many largest pension scandals of the previous decade, involving the retailer BHS.

Only one yr after tycoon Sir Philip Inexperienced bought the retail chain for £1 in 2015, it collapsed together with its two pension schemes,

That meant the lack of 11,000 jobs and put the pensions of 19,000 present and previous workers underneath risk.

The Pensions Regulator concluded that Sir Philip Inexperienced bought the enterprise to dodge accountability for the corporate’s pension scheme.

MPs referred to as for Sir Philip to be stripped of his knighthood and a Parliamentary report referred to as him the unacceptable face of British capitalism.

Sir Philip later agreed to pay £363m into the pension schemes.


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