Commentary on Sections Summary Relationship with fraud compensation regime Section 172: Relationship with fraud compensation regime
634.Subsection (1) clarifies that no notice transferring responsibility for the scheme to the Board can be given within the first 12 months of the assessment period. This is to give time for a fraud compensation application to be made as the payment of such compensation may affect the scheme’s ability to meet the cost for the protected liabilities, and so affect whether the Board must take responsibility for the scheme.
635.Subsection (2) states that, where there has been an application for a fraud compensation payment under section 182, (cases where fraud compensation can be made) no transfer notice can be given until the Board has decided the application, and the period within which the Board’s decision can be reviewed has expired and any review, reconsideration or reference to the PPF Ombudsman against the decision and any appeal against his decision has come to an end.
636.If, during the assessment period the Board decides to make a fraud compensation payment and compensation becomes payable after the relevant time (as defined), then it will be regarded as an asset of the scheme at the relevant time, for the purpose of valuations referred to in sections 127(2)(a), 128(2)(a), 152(2) or 158(1). This does not apply where the compensation payable relates to a reduction in value of assets relating to money purchase benefits.