Two pension trustees have been charged with making illegal loans from a company pension scheme to the scheme employer, following an investigation by The Pensions Regulator (TPR).

The regulator has alleged that the pair used money from the Eastman Machine Company Limited Superannuation Scheme to make two loans to the scheme’s Huddersfield-based employer, Eastman Staples Limited.

The alleged payments, which were a £100,000 loan in 2017 and a second £140,000 loan in March 2018, would be contrary to section 40(5) of the Pensions Act 1995.

The company directors, Andrew Kyprianou and Colin Web appeared at Leeds Crown Court on Friday 28 May, where they both pleaded not guilty to two counts of making prohibited employer-related investments, having previously appeared in court earlier in May.

The men also pleaded not guilty to two charges of providing false or misleading information to TPR contrary to section 80 of the Pensions Act 2004 for documents provided to the investigation, which the regulator alleged were fabricated,

Making employer-related loans from a pension scheme is a criminal offence and can potentially lead to an unlimited fine and/or imprisonment, while knowingly providing false information to TPR can result in a fine or up to two years in prison.

A trial date is expected to be set in mid-June.

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