THIS IS VERSION 1 OF THIS DOCUMENT – ISSUED BY DALRIADA TRUSTEES LIMITED. FREQUENTLY ASKED QUESTIONS WILL BE ADDED HERE FROM TIME TO TIME AS THEY ARE IDENTIFIED – PLEASE CHECK BACK FOR UPDATES. THIS DOCUMENT MAY BE FREELY CIRCULATED OR REPRODUCED IN ITS ENTIRETY BUT DALRIADA TRUSTEES LIMITED MUST BE ACKNOWLEDGED AS THE SOURCE OF THIS DOCUMENT. WE WOULD APPRECIATE THAT WHEN CIRCULATING ELECTRONICALLY OR OTHERWISE THAT A LINK TO www.dalriadatrustees.co.uk/becker-fellowes IS SHOWN SO THAT READERS CAN EASILY ACCESS THE LATEST VERSION.
This Frequently Asked Questions (FAQs) document relates to the following pension schemes (the Schemes):
Bovey Cranbrook Retirement Benefits Scheme
Cotswold Ash Retirement Benefits Scheme
Dunoon Glen Retirement Benefits Scheme
Lulworth Trent Retirement Benefits Scheme
Mendip Beech Retirement Benefits Scheme
Morton Glen Retirement Benefits Scheme
Pennine Elm Retirement Benefits Scheme
Powderhan Exe Retirement Benefits Scheme
Rait Fell Retirement Benefits Scheme
Dalriada has made documents available for download by members.
Click on the relevant Scheme name above to see the documents available for download.
Copies of all Announcements issued to date can be downloaded from the links below:
Frequently Asked Questions
FREQUENTLY ASKED QUESTIONS WILL BE ADDED HERE FROM TIME TO TIME AS THEY ARE IDENTIFIED – PLEASE CHECK BACK FOR UPDATES.
Q Why and When was Dalriada Trustees Limited (Dalriada) appointed?
Dalriada is a professional independent trustee who was appointed by Court Order to take over the running of the Schemes on 19 September 2013. Dalriada is experienced in dealing with pension schemes that have complex issues and / or have unusual investments.
Because it is an independent trustee, Dalriada is not linked in any way with the original trustees of the Schemes. Dalriada effectively replaced the original trustees and was given exclusive powers to deal with the Schemes.
Subsequent to our appointment, the Pensions Regulator prohibited the original pension trustees, David Fellowes, Francine Becker and Avalon Pension Trustees Limited, a trustee company controlled by them, from acting as trustee of any trust schemes in the future.
Dalriada was appointed because the Pensions Regulator (tPR) was concerned that the Schemes were being used for pension liberation.
Pension liberation occurs where individuals are encouraged to transfer their existing pensions to new schemes in the expectation of getting money from their pension fund before the minimum retirement age of 55. This is usually by way of a loan or some form of cash inducement.
Pension liberation can become fraudulent if members have not been given the full facts about the risks and costs involved.
Schemes used for pension liberation generally have high charges and often invest whatever money is left after these charges in risky and unusual investments. They also put members at risk of having to pay large amounts of tax. Pension savings benefit from tax relief because they are meant to provide benefits in old age. If individuals try and take money out of their pensions early, HMRC can charge tax on any payment at a rate of up to 55%.
Q Are the pension schemes’ assets safe?
Dalriada has obtained control of the Schemes’ bank accounts. With regard to the other investments made by the Schemes, the position is as follows.
Dalriada has been working to gain control of the investments made by the previous trustees.
Dalriada established that around £12.1m was transferred into the Schemes by way of individual member transfer payments and the vast majority of that money (£10.9m) was paid over to Quantum Life, an insurance company based and regulated in Liechtenstein.
Of the remainder, about £800,000 was paid in fees to the previous trustees and their advisers.
The balance, just over £350,000, was held in cash.
The money paid to Quantum Life has been moved through companies based overseas (in Mauritius) to investments tied, we understand, to wheat farming in Australia and to ‘emerging market’ funds in Asia (India).
Dalriada has sought information from Quantum Life and, also, from the previous trustees and the Financial Adviser who advised the previous trustees. Generally, they have been unhelpful and uncooperative which is making it very difficult for us to properly understand where funds are held and what they are worth. At this stage, it appears that they are ‘highly illiquid’, in other words they cannot be ‘cashed in’.
Dalriada is trying to find out when it will be able to get funds back into the Schemes, and, at that time, what the Schemes’ investments are likely to be worth, if anything.
Dalriada considers the investments through Quantum Life high risk and inappropriate, particularly given the fact that the vast majority of the Schemes’ funds have been placed in the one investment. We are concerned that the investment will have little or no value ultimately which will impact greatly on the value of members’ benefits. Again, this would suggest that the Schemes might simply be scams.
Dalriada will continue to work in determining how likely it is that it will be able to get some money back from the investments through Quantum Life and, if necessary, what other options might be available (for example legal action).
Q Will the value of my pension fund be reduced?
Until Dalriada can determine the value of the Schemes’ assets, it will not be able to give members an indication of the value of their benefits under the Schemes. However, as set out above, it is likely the realised value of the Schemes’ investments will be materially less than the amount invested. This would mean that members’ funds would be reduced.
In our 2nd Announcement we explained that the Pensions Regulator had concerns that Schemes had been used for pension liberation. If members have received a cash payment as a result of joining one of the Schemes, HMRC may find these to be ‘unauthorised payments’. If that is the case there is a possibility that the Schemes themselves may be subject to tax penalties. If so, this will reduce the remaining funds held in the Schemes and therefore, ultimately, member benefits.
Any costs that are incurred (see below under ‘What costs are being taken?’) will be taken from the Schemes’ funds and will accordingly reduce the amount of members’ funds.
Q What actions have you taken and what actions are you taking?
Dalriada has received copies of the member files that were seized by City of London Police from the previous administrators. Based on those records we have now created proper administration records on our computer systems.
As well as taking control of the Schemes’ bank accounts, Dalriada has also obtained copy bank statements for the Schemes. These have been reconciled against the member files and we have now created the necessary accounting and financial records.
In conjunction with our legal advisors we have been actively pursuing recovery of the investments. Given the nature of the investments this is proving to be a long and difficult process.
We have prepared announcements for members and a centralised website with FAQ’s. These will be updated on a regular basis.
We are in contact with HMRC regarding the tax position concerning the Schemes and keep the Pensions Regulator regularly updated on progress.
Dalriada is continuing to get as much information as it can regards all aspects of the Schemes.
Q What costs are being taken?
Usually, where a scheme is an occupational scheme, some, if not all, of the costs of running the scheme would be met by the employer. The employers linked to the Schemes do not appear to have ever actively traded nor do they appear to have any assets or means to contribute to the costs of running the Schemes. This means that the costs of the previous trustees and its administrators and advisers, as well as Dalriada’s costs and legal costs, have been, and will continue to be, met from the Schemes’ funds.
Whilst Dalriada will do all it can to minimise costs, because of the number of complex issues associated with these types of scheme, not least the work involved in setting up proper administration records and trying to identify and recover investments, costs will be significant and will impact on the value of the Schemes’ funds.
Q What is the value of my pension fund and when can I take my benefits?
As commented above, until
- the realised value of the investments is known,
- the tax position is clarified,
- the final costs are known, and
- we know how the costs and losses are to be apportioned between the Schemes and members
Dalriada is not able to value members’ funds. To explain further:
- Ultimately, Dalriada might require direction from the Court as to how to apportion any remaining assets of the Schemes (taking into account any losses suffered by the investments and costs, including any tax charges) between members.
- The Trustee can only allow benefits to be taken once it knows the correct value of the fund for each member. Therefore we cannot agree to any benefits being taken at this point and it may be some time before we are able to do so.
Q Can I transfer out of the Schemes to another registered pension scheme or take my benefits?
Until Dalriada can place a value on the members’ funds it will be unable to pay out any transfer values. It may be many months before any transfer values can be paid out. Similarly, and as mentioned above, we cannot agree to any type of benefits being taken at this point.
Q I feel that I have been wrongly advised to transfer into a scheme. Who should I complain to?
Dalriada’s role as Independent Trustee is to manage the Schemes in the best interests of their members. If any member feels that they were wrongly advised to transfer into a scheme then Dalriada cannot assist with this complaint. You should immediately contact the firm that provided the advice.
If a member has a complaint about any action taken by Dalriada than you should complain in the first instance to Dalriada.
You may also find it helpful to read our page about the regulation of pension schemes. If you wish to speak to someone independent of Dalriada, The Pensions Advisory Service provides a free, independent source of advice.
Q What should I do if I have any further questions?
If you are a member or prospective member of one of the Schemes and have a personal question please contact Dalriada in one of the following ways:
By telephoning our helpline for members
Dalriada Trustees Limited
27-37 Adelaide Street
By e-mailing firstname.lastname@example.org
By using the Get in Touch form on our website.