North West pension company wound-up after mismanaging £14m of funds
A Preston company that managed two pension schemes has been wound-up by the court after failing to properly maintain £14m worth of members’ funds.
Ecroignard Trustees Limited was wound up on Monday 2 September by Deputy District Judge Carter at the High Court in Manchester following an investigation by the Insolvency Service. The Official Receiver has been appointed as liquidator.
At the hearing to consider the petition to wind up the company, the court heard that Ecroignard Trustees Limited (Ecroignard) acted as the trustee of two pension schemes – The Uniway Systems Retirement Benefits Scheme and the Genwick Retirement Benefits Scheme.
Ecroignard was responsible for circa 229 members and £14 million worth of investments. Following complaints, however, the Insolvency Service conducted confidential investigations into the company’s activities before uncovering numerous instances of misconduct.
Investigators uncovered that Ecroignard had traded with a lack of commercial integrity. Pension funds were used to invest in vehicles that were illiquid, high-risk and not necessarily suitable for the members.
Ecroignard failed to comply with statutory requirements, best practice guidance and internal governance requirements. The company failed to ensure that the Uniway pension scheme was properly diversified or seek assurances that funds were put into regulated investments. Nor were members notified of proposed changes to their chosen investments or given an opportunity to choose how their funds should be invested going forwards.
The company failed to maintain and preserve adequate books and records. This has meant that it is unclear to investigators whether all investments are accounted for nor can they gain a comprehensive picture of members’ contributions and what payments were from Ecroignard’s bank accounts.
And the Preston-based company also demonstrated a lack of transparency and adequate stewardship. It is unclear who has been involved and responsible for the management of Ecroignard since Roger Bessent resigned as a director in April 2017.
There are also concerns that the official current director, Anthony Waterfield, has insufficient knowledge of Ecroignard’s trading to be able to manage the company. He has also been unable to provide key information to investigators, such as the schemes’ assets and the status of the schemes.
Investigators also noted that, despite having resigned previously and being disqualified from acting in the management of companies in November 2017, Roger Bessent appeared to continue having executive authority within the company. For example, he remained the sole signatory on the company’s bank account until October 2018.
Scott Crighton, Chief Investigator for the Insolvency Service, said: “When people invest their pension funds as a way of planning for their futures, they don’t expect their saving pots to be put at risk. Ecroignard’s management of the pension schemes, however, raised considerable red flags and questions remain which will need to be looked into by the Official Receiver as liquidator of the company.
“If you are considering moving your pension into an investment scheme, we strongly recommend you do your research beforehand and if you believe you have been affected by Ecroignard to contact the Official Receiver as soon possible.”