Dominic Chappell, the majority shareholder of Retail Acquisitions, the organisation that bought BHS for £1, has been fined £87,170 for failing to provide information to The Pensions Regulator (TPR) during the sale of the British retail organisation.
Under section 72 of the Pensions Act 2004, Chappell was legally obliged to provide certain information regarding the purchase of BHS by Retail Acquisition and the participants involved, as well as transactions involving BHS and the organisation after the sale was complete. TPR had requested this Information in an ongoing investigation to protect pensions.
Chappell also failed to inform the work-based pension schemes regulator about a possible disclosure of restricted material.
Failure to provide the requested information to TPR, without a reasonable excuse, is a criminal offence in the UK and can result in an unlimited fine if dealt with in a magistrate’s court.
On 11 January, district judge William Ashworth found Chappell guilty of three charges of neglecting or refusing to provide information and documents without a reasonable excuse. Chappell has denied the charges.
As a result of these convictions, Chappell was sentenced to pay £87,170 at Barkingside Magistrates’ Court on Friday 23 February 2018. This comprises a £50,000 fine, a £37,000 costs payment and a £170 victim surcharge.
This case is the fifth criminal conviction against individuals or organisations for failing to comply with section 72 notices.
TPR is still pursuing separate anti-avoidance action against Chappell regarding the BHS pension schemes.
District Judge Gary Lucie, who ruled over the case, said: “The court must send a message to those in senior positions that refusal to answer questions under section 72 will not be tolerated. The law is there for a purpose and it must be enforced. There is a complete lack of remorse on Mr Chappell’s part.”
Nicola Parish, executive director of frontline regulation at TPR, added: “We prosecuted Dominic Chappell because, despite numerous requests, he failed to provide us with information we required in connection with our investigation into the sale and ultimate collapse of BHS.
“Choosing not to comply with our section 72 notices has now left him with a criminal record and a bill for more than £87,000, both of which he could have avoided if he had simply done what was required of him. Information notices are a vital investigative tool for us. Ignoring them is a crime that can lead to prosecution.”