A Criminal Declaration

PinocchioBack in June, I explained that entering false information on The Pension Regulator’s declaration of compliance is a criminal offence, albeit one which hadn’t as yet seen any prosecutions. However, on 7th March 2018, Crest Healthcare and a related individual pleaded guilty in the first prosecution of its kind.

This is by no means the first penalty related to automatic enrolment. Up to the end of 2017, the regulator had issued 32,211 fixed penalty notices and 6,770 escalating penalty notices. These included penalties of £52,500 to Borders Hotels Ltd. This company runs a hotel and is majority-owned by a Member of the Scottish Parliament (MSP) and her husband. The MSP has said the company intends to appeal the penalty.

This also isn’t the first criminal prosecution. Last November, a bus company and a related individual pleaded guilty to eight counts of wilful failure to comply with the automatic enrolment duty. The judge ordered them to pay a total of £39,095, which is on top of the £14,400 fine they had already received from the regulator, as well as back payments of pension contributions.

The Crest Healthcare case is, however, the first criminal case related to putting false information on a declaration of compliance. The company declared that 25 members of staff had been enrolled into a pension scheme when, in fact, none of them had.

Crest Healthcare and the individual both pleaded guilty to one charge of ‘knowingly or recklessly providing false or misleading information’ to The Pensions Regulator and to two charges of ‘wilfully failing to comply with their automatic enrolment duties’. The case was adjourned for sentencing until 15th May.

The Pensions Regulator’s advertising has, in the past, featured a big, furry monster but the regulator has now demonstrated that it really does have teeth. Automatic enrolment places quite a burden on small businesses, and it is now clear what the consequences are for businesses, and for directors, who fail to comply fully with their workplace pension duties.

Steven Tucker

By Steven Tucker - Co-founder

Steven is one of the founders of The Payroll Site. He writes about things affecting small businesses, especially those things connected with payroll. He's also a Maths graduate and a Chartered IT Professional and has a few views about technology, maths and the misuse of both.