Carin Smith | fin 24 | 23 October 2019 |
A new investigative report released by advocacy group Open Secrets on Wednesday evening aims to put pressure on authorities to hold accountable those who wrongly deregistered a large number of pension funds, affecting thousands of people.
According to the report, entitled The Bottom Line, Who Profits From Unpaid Pensions?, by 2006, of the 13 132 pension funds registered with the then Financial Services Board (FSB) – since replaced by the Financial Sector Conduct Authority (FSCA) – only 3 500 were “active”.
A project launched by the FSB, therefore, wanted to get rid of these so-called “orphan funds”. Since 2007 over 6 000 pension funds had their registrations cancelled on the basis that they were no longer functioning.
However, according to the report, some of these still held assets and liabilities to fund members and should not have been cancelled.
Whistle blowers who assisted in the investigation for the report are of the view that there were widespread problems in the cancellation of the pension funds and related unpaid benefits.
“(The trustees) were obliged to make sure that the funds were indeed empty of assets and liabilities and that members were paid before submitting them to be deregistered, but this was often not the case,” states the report.