Two companies responsible for operating occupational pension schemes worth a combined £19.4million have been placed into provisional liquidation via a winding up petition following an Insolvency Service investigation.

The investigation, carried out by Company Investigations, part of the Insolvency Service, resulted in two separate hearings of applications issued on behalf of the Secretary of State for Business, Innovation and Skills. The hearings took place in the High Court on the 3 and 5 of June.

The companies, which were the trustees of two unrelated occupational pension schemes, were placed into provisional liquidation after failing to achieve anything like the type of returns they had promised.

The investigation’s findings

The Insolvency Service’s investigation found that Omni Trustees Ltd, a company with its current registered office in the West Midlands, was the trustee of an occupational pension fund known as the Henley Retirement Benefit Scheme, which had received £8.6million from members of the public.

Omni Trustees had invested £3.6million of this money in self-storage units, whilst £3.7million was held in cash before being transferred to a separate occupational pension scheme in July 2014.

The second company, Imperial Trustee Services Ltd, based in Kent, had received £10.8million from the public to be placed in a pension fund known as the Capita Oak Pension Scheme.

The investigation found the company had suffered from a number of governance issues, operating an apparent revolving door system with directors coming and going in quick succession. There was also an inability to transfer member benefits in accordance with their wishes, the result of which was a number of complaints to The Pension Ombudsman. The Ombudsman responded by commenting that the Capita Oak scheme was part of a ‘pension liberation scam’.

What is provisional liquidation?

A provisional liquidation occurs when the court appoints a liquidator to a company for the period between the filing of the winding-up petition to shut down the company, and the court hearing the application.

The provisional liquidator is appointed to protect the company’s property on the behalf of creditors if the assets of the company are in jeopardy, or if continuation of the business until the petition is heard is not in the public interest.

The provisional liquidator also has the power to investigate the affairs of companies, and ensure that any assets belonging to third parties, in this case over £19million of occupational pension payments, are no longer under the company’s control.

Both cases are now waiting for the winding-up petitions to be heard. No further information will be made available until the hearings, which are scheduled for 22 July 2015 in Manchester High Court.

The role of the Insolvency Service

Company Investigations, part of the Insolvency Service, uses powers given to it under the Companies Act 1985 to conduct confidential fact-finding investigations into the activities of limited companies in the UK on behalf of the Secretary of State for Business, Innovation and Skills.

The Insolvency Service is the government organisation responsible for administering the UK insolvency regime. This includes the investigation of all compulsory liquidations through the official receiver and the reasons behind the company’s insolvency. It also uses powers under the Companies Act 1985 to conduct fact finding missions into the activities of limited companies that are still in operation.

The Insolvency Service is also responsible for regulating the work of insolvency practitioners, disqualifying company directors who do not act in the best interest of their creditors in company insolvencies, and assessing and paying statutory entitlement to redundancy payments when an employer cannot or will not pay their employees.

If you are being threatened with winding up and unsure what action to take contact the team at 08000 746 757.