Last week saw the first arrests in relation to auto enrolment fraud. Four men and a woman were arrested in Derby and Nottingham and all five are thought to be involved with a recruitment agency known as Smart Recruitment UK. The agency, based in Derby, has offices across the Midlands and South of England is an employment agency specialising in industrial, driving and technical recruitment.
The men arrested are aged 28, 35, 37 and 38, the woman arrested is 31. All were arrested on suspicion of fraud and have now been released on bail pending further investigation. They will be invited to attend an appointment at a police station in the New Year. The arrests were part of an ongoing inquiry into auto enrolment fraud that centres on the enrolment of workers into occupational pension schemes & then subsequently underpaying them.
Derbyshire police said: "Five people arrested as part of a joint operation involving Derbyshire and Nottinghamshire police, The Pensions Regulator and the Employment Agency Standards Inspectorate have now been released on bail."
Auto enrolment fraud is in its infancy and it is impossible to understand whether it is a wide ranging problem yet because auto enrolment is only starting to get into its stride. Currently at the halfway point, it's only the larger companies in the UK that have auto enrolled, and the vast majority of the country's medium, small and micro businesses are yet to auto enrol. With over a million of these businesses yet to enrol, the potential for fraud could be bigger with these smaller businesses often under more financial pressures than their larger counterparts.
The needs of these arrests and subsequent bailings comes after The Pensions Regulator released statistics on breaches of auto enrolment. Up to September 2015, there were nearly 400 statutory notices handed out to employers by the regulator for breaching auto enrolment regulations. Of these, 279 of the notices were revoked, varied or substituted.
As auto enrolment rolls on, it will be interesting to see if we see any more arrests for fraudulent activity.
If you enjoyed this article, you may also like The Ultimate Guide to Online Fraud in the Workplace.