After nearly six years of investigation and legal proceedings, a settlement agreement has been reached that will allow the Lehman Brothers pension plan to pay full retirement benefits to 2,466 members.
Action taken by The Pensions Regulator and the plan trustees during the Lehman Brothers financial support direction case has now resulted in companies within the Lehman Brothers group agreeing to buy out member benefits in full. The estimated buyout figure is £184 million ($334.7 million).
Had a deal not been reached, the plan likely would have entered into the Pension Protection Fund, which pays compensation to DB plan members when their company becomes insolvent.
“This is a pleasing and appropriate settlement,” says The Pensions Regulator interim chief executive Stephen Soper. “This case demonstrates that the regulator’s anti-avoidance powers can be used effectively, even in highly complex international insolvency situations.”
Following the insolvency of numerous member companies of the Lehman Brothers group in September 2008, the regulator said that companies within the Lehman Brothers group should provide financial support to the pension plan.
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