The trial of former British Home Stores (BHS) owner Dominic Chappell, which has been brought by The Pensions Regulator (BHS), kicked off yesterday (8 January) in Brighton.
Mr Chappell is being accused of failing to provide information and documents during the investigation into the sale of the collapsed retailer.
He has pleaded not guilty to the charges.
Mr Chappell was the director and majority shareholder of Retail Acquisitions when the company bought BHS from Sir Philip Green's Arcadia Group for £1.
BHS went into administration in April 2016, putting workers' retirement nest eggs at risk and TPR has been investigating the case since.
In the end, a £363m settlement with Sir Philip was reached to fund a new independent pension scheme for 19,000 former BHS workers.
This will give future pensioners the option of the same starting pension as they were originally promised by BHS, and higher benefits than they would get from the Pension Protection Fund (PPF).
TPR is prosecuting Mr Chappell for failing to comply with three notices issued under Section 72 of the Pensions Act 2004. The notices requiring information were issued to Mr Chappell on 26 April 2016, 13 May 2016 and 20 February 2017.
After the sale of BHS in 2015, the regulator had concerns over the two pension schemes that retailer had in place - holding over 19,000 members - past and present employees. As at March 2015, the combined deficit for both schemes was around £500m.
TPR then began an investigation into the circumstances of the BHS sale, and whether it was appropriate to exercise its anti-avoidance powers to seek a contribution notice and/or a financial support direction in respect of the schemes and the substantial deficit.
Prosecutor Alex Stein told the Brighton Magistrates’ Court in his opening statement that “it is a criminal offence to neglect or refuse to comply with a section 72 notice without reasonable excuse,” and that the crux of the case against Mr Chappell is that he neglected to respond to three of these requests.
Mr Stein argued that “it is understood that the defendant will submit that he had a reasonable excuse in relation to the failure to respond to the notices,” such as that TPR already had much if not all of the relevant material about the case, and that he had already provided all the information which he had.
Mr Stein said: “That is not accepted by the prosecution but ultimately appears to be the issue for the Court to determine in this trial.”
The trial will continue in the next few days.