Retirement benefit schemes have expressed alarm at plans by the Government to seize Sh200 billion unclaimed assets held in financial institutions.
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| Finance Minister Njeru Githae |
They insist that they were still tracing owners of the unclaimed assets and it would be wrong for the Government to disrupt the exercise. Trustees of the pension schemes expressed discomfort with the prospect of having to hand over unclaimed assets to an authority under the control of political appointees.
Finance Minister Robinson Githae is slated to appoint a board for the new Unclaimed Financial Assets Authority comprising of five people later this month.
Agency powers
The agency has powers to take over all unclaimed assets in dormant accounts in pension funds, commercial banks, insurers or unpaid dividends in quoted firms. But the impending action has sent shock waves through local pension schemes.
But Chief Executive of Unclaimed Property Assets Register (K) Ltd – an unclaimed asset reunification solutions provider, Joe Ngigi, allayed fears saying some of the concerns are false.
He said Unclaimed Financial Assets Act 2011, passed by Parliament last December, is meant to ensure all firms trace owners or beneficiaries of unclaimed funds or forward them to the Government.
“The law will only affect those organisations not making efforts to trace owners or beneficiaries of the unclaimed funds and those without such unclaimed assets need not worry,” said Ngigi, who is also a consultant for Treasury on the new law governing unclaimed assets.
While addressing the trustees, Alexander Forbes Managing Director Sundeep Raichura said the law designed to deal with unclaimed assets should be an eye opener on estate management.
He said the new law should not only help enhance the culture of Know Your Customer within financial and other institutions, but should also encourage creation or writing of wills as one of the most critical things one can do for their loved ones.
Raichura said putting ones’ wishes on paper helps heirs avoid unnecessary legal hassles and ensures that a life’s worth of possessions will end up in the right hands.
Under the new laws, property eligible for reporting to the Unclaimed Financial Assets Authority include savings and deposits, safe deposit box contents, unclaimed shares, un-cashed dividend cheques, insurance and retirement benefits, among others.
