Think back to January, 2020, for a moment. We know, it was shortly before the pandemic kicked up in earnest, but it’s also when details of the Norton Motorcycles pensions scandal first came to light. British publications the Guardian and ITV teamed up to dig into the story, which took place several years prior to Norton going into administration and subsequently being purchased by TVS.
Back in 2012 and 2013, hundreds of British pensioners were persuaded to transfer their entire pension funds into three Norton pensions schemes by a conman named Simon Colfer. In 2018, he was convicted and received a suspended prison sentence for these and other pension fraud-related crimes. If you were one of the affected pensioners or their families, though, the damage was already done.
All three of the Norton-related pension schemes—Commando 2012, Dominator 2012, and Donington MC—all had a single trustee. His name was Stuart Garner. If that name sounds familiar, it’s because he was the former owner and CEO of Norton Motorcycles, under whose oversight the company went into administration in 2020. “Wait,” we hear you thinking. “Isn’t that a conflict of interest?” Indeed, it was, and Stuart Garner may now face either prison time or an unlimited fine as a result of his involvement.
To be clear, Garner has long claimed that he had no knowledge of the pension fraud, and was not legally implicated in the matters for which Colfer and two other of Garner’s associates were convicted. However, on February 7, 2022, Garner pleaded guilty to using around £11 million from those pension funds in order to fund the Norton Motorcycles business. Adjusted for inflation, that would be about £13,821,219.72 in 2022, or approximately $18,765,761.
According to the U.K.’s employer-related investment rules (ERI), Stuart Garner the trustee should not have invested more than 5 percent of the assets from any of those pension funds into any business that he owned. Three pension schemes = three offenses to which Garner has now pleaded guilty.
“As a trustee, Stuart Garner failed to comply with restrictions on investments which are designed to protect the funds of pension schemes. Trustees have a vital role in protecting the benefits of members and we will take action where that responsibility is abused,” U.K. Pensions Regulator executive director of frontline regulation, Nicola Parish, said in a statement.
“Trustees should be clear on when a pension scheme can invest in its sponsoring employer,” she concluded.
What happens next? On February 28, 2022, Garner is scheduled to appear at Derby Crown Court for his official sentencing. We’ll be sure to keep you updated on the outcome.
Sources: U.K. Pensions Regulator, The Guardian, Bank of England