Dominic Chappell, the owner of U.K. retailer BHS Ltd., London, was fined £9.5 million ($12.4 million) for not funding two BHS pension plans before BHS' insolvency in 2016, U.K.'s The Pensions Regulator said Tuesday.
Following an unsuccessful challenge of a TPR anti-avoidance 2018 ruling in the Upper Tribunal, Mr. Chappell will pay the fine to the Pension Protection Fund, London, the U.K.'s lifeboat plan, for the £421 million BHS Pension Scheme and the £95.1 million BHS Senior Management Pension Scheme.
Due to BHS falling into insolvency, TPR launched anti-avoidance cases in late 2016 against former owners Mr. Chappell and Sir Philip Green. Mr. Chappell bought the U.K. retailer in March 2015 for £1 from Mr. Green, who reached an agreement with TPR to provide funding for the pension plans.
The TPR said Tuesday that Mr. Chappell committed a series of detrimental acts to the pension funds, including acquisition of BHS, appointment of inexperienced board members, implementation of an inadequate business plan and the way company money was extracted and distributed to Mr. Chappell, advisers, company directors and his family members.
Mr. Chappell could not be reached for comment.
"This case illustrates how TPR is willing to pursue a case through the courts to seek redress for pension savers," said Nicola Parish, TPR's executive director of frontline regulation, in a news release. "It illustrates the situations our anti-avoidance powers were designed to meet and which allow us to protect the retirement incomes that savers deserve."
Mr. Chappell cannot appeal the case further.