Kenya’s unclaimed assets agency seeks senior staff to manage unclaimed billions

NAIROBI, KENYA: Local firms will from November be required to remit unclaimed money they hold in their coffers as the Unclaimed Financial Assets Authority (UFAA) starts to earnestly implement the unclaimed assets law.

The Authority Friday said it has already drafted regulations to guide companies on modalities of remitting unclaimed financial assets and it expects the Treasury to gazette it in the coming months.

UFAA has also started recruiting a management team to be in place by September, ready for commencement of reporting and remitting unclaimed monies from different institutions on November 1.

“These are part of efforts to operationalise and position the Authority to receive unclaimed assets from institutions that are holding them,” said Vincent Kimosop chairman UFAA.

“The authority has developed regulations to guide the institutions on reporting unclaimed assets… we have advised Treasury on the regulations in accordance with the law and we are waiting for the Cabinet Secretary to process and gazette the regulations.”

DECLARED DORMANT

A wide range of institutions hold huge amounts of money that has not been claimed mostly by their clients. These include money left in bank accounts that have since been dormant for some time, retirement benefits, dividends and matured insurance policies.

Kimosop noted that it is difficult at the moment to determine that amount held by local institutions as unclaimed assets. He however, refers to a 2008 report compiled by a Treasury appointed taskforce that estimated Sh9 billion to be the amount held by institutions in unclaimed assets. A bulk of this amount, 56 per cent, was being held by banks.

This may have however escalated by huge margins, because in the six years since the report, financial inclusion has deepened and the number of people using financial service surged. In particular are the number of people that use mobile money services. M-Pesa, the largest service in the category has over 21 million users, a large number compared to the three million customers it had by end of 2008, which was its first year in operation.

The unclaimed assets law that has been in place since 2011, has set different periods within which financial assets can be declared dormant and hence unclaimed, which ranges from two years for cheques and seven years for bank accounts. Concerns have in the past been raised as to whether companies will open up and give a true picture of the unclaimed money that they have in their possession. This is especially given the fact that many companies have in the past appropriated unclaimed assets.

AUDITS 

This has largely been due to lack of policy and legislation on the matter and most institutions often write them into their books of account. The 2008 report by the Government Taskforce on Unclaimed Financial Assets indicates that this was prevalent with more than half the respondents of the survey.

Kimosop said UFAA has powers to undertake audits on institutions that make suspicious reports. The audits, he noted, would determine whether the reports given by the institutions on the unclaimed assets they hold are indeed true. The money remitted to the Authority will be managed by the Unclaimed Financial Assets Fund, which will make deliberate attempts to reunite the money with their owners or next of kin.