The Regulator has highlighted that since the start of automatic enrolment a total of 179,801 compliance notices, 105,556 fixed penalty notices, 32,157 escalating penalty notices and 55,266 unpaid contribution notices have been issued.
The Regulator has also highlighted the following:
Last month we successfully prosecuted a third accountant for deliberately lying about completing automatic enrolment duties on behalf of an employer, and he incurred fines and costs of £5,000 for the offence (see case study below). Although the employer is legally responsible for completing their duties, knowingly providing false information to us is a crime by whoever completes the declaration, and advisers who lie to us will be found out.
Having third party advisers who are competent and knowledgeable about all aspects of AE is vitally important, given that 30% of new employers are seeking external help with some or all of their AE duties as part of their day to day financial administration.
To make sure all advisers are up to speed with the basics, we’re running a webinar just for them on 30 March, which they can sign up to here.
With the evolution of automatic enrolment, advisers may have clients who are going through re-enrolment as well as new employers who have never been through the ‘staged’ approach, so it’s a good opportunity for them to brush up on their knowledge and avoid compliance issues down the line.
This Cambridge-based former accountant was working for an employer with 17 members of staff. The company came to our attention as part of our compliance validation checks after it failed to declare compliance on time, and received a fixed penalty notice (FPN), and subsequently an escalating penalty notice (EPN). The EPN had accrued to £4,500 when the employer declared compliance, claiming that 10 employees had been automatically enrolled and two were not eligible.
We discovered the declaration was false when the pension scheme contacted us to say that the employer’s account had been cancelled, and that no employees had been enrolled. After serving the employer with an inspection notice we discovered that there were indeed eligible staff. We also discovered that the accountant had been struck off the Chartered Institute for Management Accountants’ register in 2018.
The employer claimed that the accountant had reassured him that AE was in hand, but when we challenged this he enrolled the relevant staff and backdated contributions. The accountant admitted to falsifying the information on the declaration, claiming that he had misunderstood the questions on the declaration of compliance, was overwhelmed with work and had intended to re-submit the correct information when he had more time. We prosecuted the accountant for giving us false and misleading information – he pleaded guilty in court and was penalised nearly £5,000.
Message to advisers
Whether you are too busy or simply don’t understand what you need to do, don’t give us false information. We have all the information you need on our website, so ignorance is no excuse. We are still carrying out these data-led inspections throughout the country, so we’ll find out if you’ve lied to us and you may end up being prosecuted.