Two fraudsters have been sentenced to prison for fleecing pension savers out of £14m after the brains behind the scam killed himself.
The trio persuaded 245 people to transfer savings into fraudulent pension schemes, the Crown Court has ruled.
Alan Barratt, 62, of Essex and Susan Dalton, 66, of Rochdale, both admitted to abusing their positions as trustees of pension schemes to commit fraud. They coaxed vulnerable savers into schemes set up with fraudulent intentions. They had enticed them with unrealistic returns, cash bonuses and John Lewis vouchers.
They were sentenced to just under six years in prison, only half of which they must serve.
The scam’s “mastermind” David Austin killed himself in 2019 after being invited for a police interview under caution, the court was told. Mr Austin was provided with blank cheques to fraudulently withdraw funds from the pension scheme accounts.
Mr Austin and Mr Barratt were ordered to repay £7.7m by The Pensions Regulator in 2018, while Mr Austin and Mrs Dalton were liable to pay back £5.9m.
Investors have been “robbed of their security in later life”, the judge ruled. Some victims attempted suicide after they faced poverty in retirement.
Stephen O’Reilly, 61, from the Isle of Wight, lost £104,000 to the scam, after being lured by an online advertisement.
He received a call on his 55th birthday to tell him that his money was gone, destroying his dream of retiring in Spain and costing his children their inheritance.
“These scammers have ruined my life. Now I’m depressed all the time because I know I’m going to have to work for the rest of my life because my pension has been stolen,” he said.
“I was a miner from 1978 to 1992, I put in 14 years of hard work, averaging about 80 hours a week. I was putting my money into my pension.”
Once the pension savings had been transferred, the pair sent the majority of the money to Mr Austin who is said to have used it for his own personal benefit, including to enrich himself and his family and fund his businesses.
Mr Barratt made £396,000 while Ms Dalton earned £168,000 from the scam, according to official accounts.
Both tricksters, who were based in Spain, were part of a “criminal enterprise”, according to The Pensions Regulator, as they cold called savers and talked them into transferring their pension.
Nicola Parish, of the pension regulator, said it was a “despicable” case but that “tough action against fraudsters” was taken.
Victims of the pension scam under age 55 have also faced eye-watering tax bills from HMRC for accessing their pension too early.