UK - Maxwell-type pensions scandals could still occur if individuals were determined to defraud schemes, OPRA warns.
The industry watchdog conceded that it was reliant on whistleblowers for its information and did not have the powers to be an investigative regulator.
OPRA’s regulatory director Joe Robertson said: “We have got to allow for the fact that pension scandals can happen.”
He explained: “This is the reason why the protection of pensions actually stands on three pillars. The first is the safety given by the trustees, the second is the control that OPRA gives and thirdly is the fact that the pensions compensation board can step in if everything else fails.”
Robertson said the government was very aware of the continued risk and the pensions compensation board acted as a safeguard against further scandal.
Other pensions experts reinforced the point that the pensions compensation board had been set up to tackle any future problems.
PricewaterhouseCoopers partner John Shuttleworth said: “It is generally agreed amongst pension professionals that what Maxwell did could be repeated and that subsequent changes would not have stopped it.”
OPRA also added that it would need a vast – and perhaps untenable – increase in resources if it were to be able to put a halt to every possible case of fraud.
Robertson said: “If you actually wanted to make sure that not a penny was ever stolen then OPRA would have to countersign every request for every payment made out of a pension fund. We would need about 25,000 staff to do it.
“As long as you have 100,000 pension schemes in the UK then there is a limit to the level of intervention you can have in any one scheme.”
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