Accountant who lied about cafe staff having workplace pension sentenced

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Hashmukh Shah said staff were enrolled into a workplace pension scheme when he knew this was not the case, to avoid an inspection taking place.

Hashmukh Shah court case

An accountant who lied about staff in a Knightsbridge cafe having a workplace pension has been ordered to pay nearly £7,000.

Hashmukh Shah pleaded guilty to knowingly or recklessly providing false or misleading information to The Pensions Regulator (TPR) about Gran Caffe Londra, which is opposite Harrods, in August and was sentenced at Brighton Magistrates’ Court on Thursday.

In the first prosecution of its kind, Shah said staff were enrolled into a workplace pension scheme when he knew this was not the case, to avoid an inspection taking place.

Hashmukh Shah
Hashmukh Shah pleaded guilty to knowingly or recklessly providing false or misleading information to The Pensions Regulator (Philip Toscano/PA)

Shah, 63, of Richmond in Surrey, did not react as district judge Teresa Szagun handed him the £3,937.50 fine, costs of £2,800 and a victim surcharge, making the total repayment £6,857.50.

She told the court that although Shah was “firefighting a financial crisis” for the company at the time, his actions were “deliberate” and with knowledge of the risks so he could “buy some time”.

The “mischief” of failing to comply with the rules is detrimental to individual employees and a society with an ageing population, she added.

TPR investigated after the company which runs the cafe, Primadell Ltd, missed its deadline to automatically enrol staff for a pension in October 2015.


It has since gone into liquidation, the court heard.

The cafe described itself on its website as “one of Knightsbridge’s best kept secrets, adjacent to Harrods yet slightly removed from the shoppers”, serving “authentic Italian food” including champagne afternoon teas.

In March last year it hosted the launch of Lamborghini’s brand of wine in an event attended by celebrities and figures from the worlds of politics, fashion and sport, its website said.

Italian businessman and film producer Marcello Moscarello is a director of Primadell Ltd and another company called Gran Caffe Londra Ltd.


He is also listed as a director for production company TMC Films, according to Companies House records.

During an inspection of the business by TPR, Shah falsely declared the company had met its legal requirements.

But when later interviewed, he admitted misleading officers, causing the investigation to be delayed by more than a year and denying staff pension contributions to which they were entitled.

The company eventually complied in March this year and has backdated contributions of around £5,000 for 11 staff, although it is thought more may have been eligible and missed out.

Despite reminders, extensions and fines of £5,800 for failing to respond since February 2016, no paperwork was handed over.

Carl Dowling, prosecuting, said the requests were “ignored” but the company was “clearly a business of some means” and was paying rent of around £100,000 a year.

It is believed more staff may have missed out on contributions but an exact number is not known.

Shah worked as a consultant for the company two days a week. He set the scheme up two days before a threatened inspection, but staff were not enrolled until a year and a half later after TPR investigation was launched.

Company directors “discouraged” inspectors from speaking to staff because it would distract them from their work, Mr Dowling said.

Steve Harris, defending, said Shah was in “extremely poor” health and had no experience with automatic enrolment pensions.

Shah was “simply firefighting” urgent daily problems to keep the company afloat so the requests from the Pensions Regulator were “put on the back burner” while he did not have time.

But he conceded Shah was “reckless” in lying about complying with the law and it was a “stupid mistake”, saying he felt “quite ashamed” and “very foolish”.

“What he should have done is walk away.

“He’s desperately sorry he finds himself here today,” Mr Harris added.

The married father, who has two grown-up children, missed out on about £16,000 of income from the company, the court heard.

He lives in the affluent south-west London district of Ham near Richmond in a three-bedroom terraced house modestly valued at £550,000, with his wife, a teacher, and his elderly mother.

The cafe was in set in “prime real estate” and a “very successful operation” with a vast turnover of staff, but Shah was battling a “perfect storm” of rising rent and business rates alongside a “dramatic drop” in trade which saw the company fall into “severe debt”.

He claimed the loss in custom was down to a diplomatic row which saw the number of Saudi Arabian shoppers visiting Qatari-owned Harrods drop, and therefore fewer people visiting the cafe.

The company went into liquidation with “significant liabilities” and both directors – who have not been prosecuted by TPR – were facing “personal bankruptcy proceedings”, Mr Harris said.

“It was clear [Shah] was given entirely no support whatsoever from directors of the company to keep it running and solvent”, Mr Harris added.

Deliberately providing false information to TPR about automatic enrolment is an offence under the Pensions Act 2004.

This is the first time the watchdog has prosecuted a third party on behalf of an employer – the maximum penalty of which is an unlimited fine.

All UK employers are required by law to put eligible staff into a pension scheme and pay minimum contributions.

Shah, who has racked up £15,000 in credit card bills, was given a year to pay the fine and costs to the court, with around half the amount due in a month.

Darren Ryder, TPR’s director of automatic enrolment, said it was “totally unacceptable” for any professional to file false documents, adding: “This case sends a clear warning to accountants and advisers tasked with completing an employers’ automatic enrolment duties – providing TPR with false or misleading information may land you with a criminal conviction and a fine.

“We take our role to ensure workers get the pensions they deserve, and are entitled to by law, very seriously.

“We do not look kindly on people whose deception gets in the way of our work.”

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