The Fraud Compensation Fund has paid £9.4m to the three retirement schemes that collapsed during the Norton Motorcycles pension scandal, more than a decade after victims had seemingly lost their life savings.
The payment represents some long-awaited good news for more than 200 people who fell victim to what is known as “a pensions liberation fraud” during 2012 and 2013, when they were tricked into allowing about £11.5m to be transferred out of their existing retirement plans.
Most of those funds were transferred into three Norton pension schemes and then vanished after being invested directly into Norton’s business, a heritage British motoring brand that dates back to the 19th century and has boasted high-profile devotees including the revolutionary Ernesto “Che” Guevara and the actor Keanu Reeves.
Victims welcomed news of the payment, which comes after a long-running campaign to establish if the Norton schemes were eligible. However, some pension scheme members continue to feel frustrated as they still face a wait to receive the money. Some victims have not lived long enough to receive the award.
Dalriada, the trustee appointed by the regulator in 2019 to manage the Norton schemes, said it had still to establish how much each member is owed and that this task could run until November.
Neil Davis, 57, is owed about £51,000 of compensation after transferring a pension pot built up working as a bin man for Tewkesbury borough council in Gloucestershire.
He said: “It is pretty disappointing to learn that the funds will possibly take until the end of the year to be transferred. We were under the impression this would be quite a quick process [from now]. Don’t they think we have suffered enough?”
The news of the compensation payment follows years of reporting on the scandal by the Guardian, which exposed how senior government ministers feted a businessman called Stuart Garner, who acquired Norton with £1m borrowed directly from a pension fraud, received a further £10m that was raised via the pension liberation scam, and then illegally invested that pension money into his own business.
Norton then collapsed into administration in January 2020 and five months later the Pensions Ombudsman ordered Garner to make a “restorative payment” to all the scheme members – then thought to total about £14m including interest.
The businessman was also told to pay £180,000 to 30 complainants for “exceptional maladministration causing injustice” and the ombudsman stated Garner had acted “dishonestly”.
The ombudsman’s decision led to Garner filing for bankruptcy, leaving the Fraud Compensation Fund, a statutory public corporation accountable to parliament, as the only viable method of recompensing the victims.
In 2022, Garner pleaded guilty to illegally investing millions of pounds of people’s retirement savings into his own businesses. He received an eight-month prison sentence, suspended for two years.
The conviction represented a huge fall from grace for the entrepreneur, who had used Norton’s brand to secure himself a cameo role in the 2015 Bond film Spectre and travelled with a government trade mission to China on Theresa May’s jet when she was prime minister.
Norton was bought out of administration in April 2020 and has since begun marketing bikes as a separate business under new ownership.
