One of Britain’s biggest providers of workplace pensions will be sold this week following a catalogue of problems which led to it being fined last year by the industry regulator.
Sky News has learnt that NOW Pensions is being sold to Cardano, a specialist risk manager which owns Lincoln Pensions, a respected pensions advisory business based in London.
Details of the transaction, which is said to be worth little more than £10m, are expected to be confirmed on Thursday.
NOW Pensions launched in 2011 with the objective of targeting the auto-enrolment market, and has since amassed two million members, making it one of the UK’s biggest pension schemes.
It is currently owned by ATP, a Danish company.
However, NOW Pensions has been plagued by administrative problems, leading to some scheme members’ savings not being collected from members and invested as they should have been.
A year ago, The Pensions Regulator fined the trustee of NOW Pensions £70,000 and issued an improvement notice to the company.
Nicola Parish, the watchdog’s executive director of frontline regulation, said at the time: “This package of measures, together with those voluntarily taken by the trustee, should ensure that the issues with NOW (Frankfurt: 11N.F – news) : Pensions which have persisted for so long are finally resolved.
“We will continue to monitor progress and will issue further fines if necessary to ensure that the trustee and NPL focus on resolving the issues as swiftly as possible.
NOW Pensions has also face criticism on other fronts.
Last month, the Financial Times reported that MPs (BSE: MPSLTD.BO – news) examining its performance had queried why its investment returns were substantially below those of peers such as NEST and Legal & General (LSE: LGEN.L – news) .
Adrian Boulding, a director of NOW Pensions, said that returns had been lower because trustees had not wanted to expose members to exchange rate volatility.
NOW Pensions did not respond to a request for comment on Wednesday.
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