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NatWest accused over pension funds

The Maxwell Trial; Day 41

Financial Correspondent

The lawyer defending Kevin Maxwell accused National Westminster Bank of having knowingly accepted pension fund assets as collateral for loans to private Maxwell firms.

The lawyer, Alun Jones, said that David Leal-Bennett, a NatWest executive testifying at the trial, knew he was being handed pension fund assets when he accepted $35m in shares after Robert Maxwell died in 1991.

Kevin Maxwell gave NatWest the shares as collateral for two emergency loans totalling $27.3m.

The shares were in an Israeli company, Teva Pharmaceuticals Industries. The name of the main Maxwell pension fund group, Bishopsgate Investment Management, was printed on the share certificate as the owner of the shares.

"I really do want to suggest to you that you knew exactly what Bishopsgate Investment Management Ltd was," Mr Jones said. "But you cannot say so now because, looking back in hindsight, since the Maxwell empire collapsed, National Westminster Bank does not want to admit, does it, that it knew assets could be easily transferred between the pension fund and the private companies?"

"That is not true. That is not true," Mr Leal-Bennett replied. "I have nothing to hide. If I had heard or thought that the pension funds were involved at any stage I would have had that discussed within the organisation."

Kevin and his brother, Ian, and two Maxwell directors have denied conspiring to defraud pensioners by using the Teva shares to prop up ailing private companies days after Robert Maxwell died.

Kevin has also been accused of, and denied, conspiring with his father earlier in 1991 to misuse other pension funds.

Mr Jones said the witness must have known BIM was the pension fund group as he had dealt with it in the past.

But Mr Leal-Bennett said he simply did not associate the name BIM with the pension funds when he received the share certificate, adding "perhaps it is a failure on my part. I was not involved in the detail".

He told the prosecutor earlier that Kevin Maxwell told him the Teva shares were "found in a safe and it was one of Bob's (Maxwell) investments in Israel".