Nest Commits $350 Million to Octopus Renewables for Green Infrastructure

The National Employment Savings Trust (Nest) has appointed Europe’s largest investor in solar and wind assets, Octopus Renewables, to expand its renewable infrastructure investment across the continent.

The UK’s biggest workplace pension plan committed nearly $350 million this year to the endeavor, Nest said Friday. The $22.3 billion retirement system said the commitment could grow to nearly $2 billion by the end of the decade.

Octopus Renewables, which is part of Octopus Group, manages a roughly $4.2 billion infrastructure portfolio. The asset manager will arrange bespoke deals for Nest, the pension fund said, by negotiating directly with owners of renewable infrastructure projects.

The firm owns several rooftop solar assets in Manchester and Birmingham, as well as wind farms in South Lanarkshire and Northamptonshire.

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“We want to invest in the energy of the future, not the past,” Nest’s Chief Investment Officer Mark Fawcett said in a statement.

The mandate is in line with greater aims at Nest, which is known for its deep commitment to environmental, social, and governance (ESG) strategies. Over the next decade, Nest expects it will halve the carbon emissions in its portfolio and achieve net-zero by 2050.

Nest has also announced its intention to boost its infrastructure equity allocation, which it expects will grow to 5% of the total portfolio. The UK pension program expects to consider more asset managers to access unlisted infrastructure equity, particularly in global core and core-plus (funds of low-risk holdings and a core of low-risk holdings augmented with greater risk strategies, respectively) projects. Over the next decade, private market allocation at the fund is expected to grow to 15%.

Sustainable investments have been gaining momentum in Europe. Regulatory pressures are mounting from the British Parliament, which is positioning itself as a climate leader post-Brexit. In Europe, more than half of fund assets could be invested in ESG strategies by 2025, PricewaterhouseCoopers forecast.

Support is also coming from Nest’s stakeholders. According to a survey from YouGov conducted last summer, commissioned by Nest, 65% of workers who contribute to their pensions believe they should be used to reduce climate change. The poll reviewed more than 2,000 adults in the UK, just over half of whom are pension savers.

“Investing in British green energy means our members will be investing in projects they can see and touch, a tangible connection to their pension and a way out of the climate crisis. The strong foundations of this kind of investment should help them achieve great returns for their future while directly investing in the future of the planet,” Fawcett continued.

“Nest’s action shows that schemes with economies of scale can access alternative investments, including renewable technologies, at a low cost to their members,” Minister for Pensions Guy Opperman said in a statement.

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Tags: environmental social and governance investing, Investment, Investment Fund, National Employment Savings Trust (NEST), Pension, Socially Responsible Investing, Sustainability, United Kingdom

The co-founder of a Miami-based firm that claimed to offer cryptocurrency-related financial products has been sentenced to eight years in prison for his role in a scheme that took more than $25 million from victims investing in the company’s digital funds.

Sohrab “Sam” Sharma pleaded guilty to conspiring to commit securities fraud, wire fraud, and mail fraud in connection with material misrepresentations and omissions used to solicit investors to buy digital tokens issued by Centra Tech, the company he co-founded, through fraudulent fundraising that included an initial coin offering (ICO).

According to documents filed in US District Court in the Southern District of New York, Sharma, along with codefendants Robert Farkas and Raymond Trapani, founded Centra Tech, which in addition to claiming to offer cryptocurrency-related financial products, also offered a purported debit card called the “Centra Card.” The credit card purportedly allowed users to make purchases using cryptocurrency at establishments that accepted Visa or Mastercard.

Sharma and his associates solicited investors to purchase unregistered securities, and claimed in offering materials disseminated via the internet that Centra Tech had an experienced executive team with impressive credentials, including a CEO named “Michael Edwards” who had more than 20 years of banking industry experience and a business administration degree from Harvard University. The men also claimed Centra Tech had formed partnerships with Bancorp, Visa, and Mastercard to issue Centra Cards licensed by Visa or Mastercard, and that Centra Tech had money transmitter and other licenses in 38 states.

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It was based in part on these claims that victims forked over millions of dollars’ worth of digital funds in investments to buy the Centra Tech tokens. When the fundraising efforts concluded, the digital funds raised from victims were worth more than $25 million, and at certain times in 2018 were worth more than $60 million.

However, the claims made by Sharma and his co-conspirators to lure the investors were false, and Michael Edwards and another supposed member of Centra Tech’s executive team didn’t even exist—they were fictional people who were fabricated to dupe investors. Centra Tech also had no partnerships with Bancorp, Visa, or Mastercard.

“Sohrab Sharma led a scheme to deceive investors by falsely claiming that the startup he co-founded had developed fully functioning, cutting-edge cryptocurrency-related financial products,” US Attorney Ilan Graff said in a statement. “In reality, Sharma’s most notable inventions were the fake executives, fake business partnerships, and fake licenses that he and his co-conspirators touted to trick victims into handing over tens of millions of dollars.”

In 2018, the FBI seized 100,000 Ether units, consisting of digital funds raised from victims who purchased digital tokens issued by Centra Tech. The US Marshals Service sold the seized Ether units for approximately $33.4 million earlier this year, which will be available for potential use in a remission program the Department of Justice (DOJ) intends to create to compensate victims of the Centra Tech fraud.

In addition to the eight-year prison term Sharma, 29, was also sentenced to three years of supervised release and ordered to forfeit more than $36 million, in addition to a $20,000 fine.