More than 200 building societies probed in connection with withheld pensions cash

More than 200 investigations are under way into construction companies that have kept money from employees earmarked for pension funds, it emerged today.

The Pensions Board said all its probes were into building firms and warned there would be further cases.

Brendan Kennedy, chief executive, said: “We have at the moment over 200 cases where we are pursuing employers who see not to have passed on money deducted from their workers,” he said.

“At the moment we are preparing two cases, which in the next number of weeks will be in court.

“There will definitely be further cases.

“It’s a very very serious offence, it’s arguably the most serious offence in terms of pensions, taking the money that should be in the pensions fund.”

Anyone caught flouting the rules could face up to five years in jail and/or be hit with a fine of 25,000 euro.

The Board opened 181 new investigations into firms last year, 150 of which were launched because of whistleblower reports mainly involving the failure to pass on pension contributions.

In one case the Board successfully sought a High Court order demanding a construction firm pay arrears of €186,825.

The case was taken against Limestone Construction Ltd after it failed to put pension contributions deducted from workers to the Construction Workers Pensions Scheme.

The Board and gardai raided the firm in October 2007 and seized computer and payroll records.

At the launch of the Board’s 2008 annual report Mr Kennedy said that while pension losses last year were unavoidable, the scale of it was worse that it should have been.

He claimed there was a culture of firms putting money into high-risk schemes with little or no thought given to the potential loss.

“I think it’s been sort of a cultural thing in Ireland. I think going back a number of years, everybody had the same view,” Mr Kennedy said.

“There was this widespread assumption that the best thing to do with pensions seemed to be to put a very high proportion in stocks and shares and property.

“You’ve got to take account not just of how big a return you’ll get, but what the downsides are.”

Key findings from the report:

:: Some 852,119 people were in occupational pension schemes – up more than 27,000 on the previous year.

:: PRSA’s jumped from 130,709 in 2007 to 155,632 last year.

:: The number of defined benefit schemes dropped by 8,059 from 90,424 last year after companies wound them up.

:: Twenty-three firms were hit with on-the-spot fines for failing to submit correct documentation for pension schemes.

:: Four prosecutions were brought against employers who failed to respond to a request for information over their responsibility to provide pension funds for workers.