Hogan Lovells

Key Dates

Determination issued 11 July 2018.


The Pensions Ombudsman has directed Northumbria Police Authority to reinstate a former member's benefits in the Police Pension Scheme (at an estimated cost of £124,000), or to provide him with equivalent benefits from another provider.  When processing the member's transfer out request, the Authority had failed to conduct adequate checks and enquiries in relation to the proposed receiving scheme; send the member the Pension Regulator's scorpion warning leaflet; or engage directly with the member regarding the concerns it should have had. 


Mr N applied in late 2012 to cease his active membership of the Police Pension Scheme (the Scheme), because he was considering reducing his working hours and taking a greater role in childcare.  He was concerned that he would not be able to access his pension from the Scheme from age 55 and, in August 2013, he contacted a company called Pension Transfer UK. He was subsequently contacted by an unregulated introducer and then by a firm of financial advisers.  He was recommended to join the London Quantum Retirement Benefit Scheme (Quantum), a defined contribution occupational pension scheme, and his benefits from the Scheme were transferred in August 2014.  In 2015, Mr N noticed that he had signed up to a high risk investment as a sophisticated investor.  In June 2015, the Pensions Regulator (tPR) appointed an independent trustee to London Quantum.  The independent trustee believed that actions taken by the previous trustee may have been in breach of trust and that members may have suffered loss as a result.

Mr N's complaint to the Financial Ombudsman Service about the financial adviser was rejected on the grounds that the adviser had not carried out any regulated activity.  His complaint under the Scheme's internal dispute resolution procedure (IDRP) was also rejected.  He then complained to the Pensions Ombudsman who, after issuing a preliminary decision, decided to hold an oral hearing.

Consideration by Pensions Ombudsman

The Ombudsman reviewed the development of the pensions industry's knowledge and understanding of pension liberation fraud.  He noted the following in particular.

Pensions Ombudsman's directions

The Ombudsman upheld the complaint of maladministration against the Authority and found that had it acted more diligently then, on the balance of probabilities, Mr N would not have proceeded with the transfer to Quantum.  He made the following directions.

Date Accessed: 28/05/2022