Lehman Brothers pension scheme payout agreed 

Members of the Lehman Brothers Pension Scheme will receive their benefits in full after a £184m settlement was reached in the six-year legal battle that followed the firm’s insolvency.

The Pensions Regulator (TPR) announced today that a settlement had been agreed that would keep the 2,500-member scheme out of the Pension Protection Fund (PPF).

This comes after the watchdog’s determinations panel issued a financial support directive against six solvent Lehmans group companies in 2010, ordering them to pay plug the scheme’s deficits.

TPR chief executive Stephen Soper said the £184m settlement sum was the largest secured by the regulator using its anti-avoidance powers.

He said: “This is a pleasing and appropriate settlement for the 2,466 members in the Lehman Brothers Pension scheme, and shows we will not hesitate to pursue regulatory action to protect members’ benefits and PPF levy payers where we believe it is appropriate.”

“This case demonstrates that the regulator’s anti-avoidance powers can be used effectively, even in highly complex international insolvency situations,” he added.

The Court of Appeal upheld this decision in 2013, confirming that trustees could apply to extend a directive and that the regulator’s two-year time limit to issue a direction did not apply in these cases.

The High Court and Court of Appeal ruled that directives effectively had ‘super priority’ and ranked ahead of most other creditors.

This paved the way for the settlement announced today, which recovers the full deficit on a buyout basis.

 

Source: accountancyage

---