Former Norton CEO Facing Jail Time

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Stuart Garner now faces up to two years of jail time after pleading guilty to illegally investing Norton workers’ pension funds. (Paul Bryant/)

Stuart Garner, the man who bought Norton in 2008 and revived the brand with a revamped Commando range and the ambitious V4 superbike project, now faces jail for illegally investing other people’s retirement funds into the business.

Garner has been in the spotlight for the pension problems ever since Norton went into administration in January 2020. He poured money from three pension funds—the Dominator 2012, Commando 2012, and Donington MC schemes—into Norton to help prop the business up, breaching laws that allow a maximum of 5 percent of occupational pensions to be invested into the employer’s company. Garner was the sole trustee of the funds.

In June 2020 he was ordered to repay the money, variously estimated as being worth 11 million pounds ($15 million) to 14 million pounds ($19 million), after an investigation by the Pensions Ombudsman found that he had acted dishonestly, but it doesn’t appear that investors in the funds have seen any of their money back yet.

By that stage, many of Norton’s assets had been sold to Indian bike company TVS for around 16 million pounds ($21.8 million), although TVS opted not to take on the firm as a going concern. Instead, the current, TVS-owned Norton brand is a new company that has rights to the brand name and the intellectual property behind the bikes, but it’s not legally liable for the Garner-era iteration of the company when it comes to debts.

Garner, 53, led a jet-setting lifestyle as Norton’s owner, with a collection of Aston Martins and other luxury cars, and used the historic Donington Hall—an 18th century manor house neighboring the famous Donington racetrack—as the firm’s base. He also attracted significant government grants, worth several million pounds, to the business. However, he now faces a jail term of up to two years for the pension crime.

Monday, February 7, he pleaded guilty at Derby Magistrates’ Court to three charges of breaching employer-related investment rules, investing money from the three pension schemes into Norton Motorcycle Holdings Ltd. in return for preference shares between 2012 and 2013. Nicola Parish, executive director of frontline regulation at The Pensions Regulator, said, “As a trustee, Stuart Garner failed to comply with restrictions on investments which are designed to protect the funds of pension schemes. Trustees have a vital role in protecting the benefits of members and we will take action where that responsibility is abused. Trustees should be clear on when a pension scheme can invest in its sponsoring employer.”

The maximum penalty for the offence is an unlimited fine and/or a jail sentence of up to two years. Although Garner pleaded guilty at Derby Magistrates’ Court, he has been referred to Derby Crown Court for sentencing because Crown Courts have greater sentencing powers than Magistrates’ Courts, which can’t impose jail terms of more than six months. He’s been given unconditional bail in the meantime, but District Judge Jonathan Taaffe said: “This clearly crosses the custodial threshold and I am sending the case to Derby Crown Court.”

He’s due to appear there for sentencing February 28.

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