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Surrender or get penalised, holders of unclaimed assets ordered

BUSINESS
By Dominic Omondi | October 1st 2015
Unclaimed Financial Assets Authority CEO Kellen Kariuki during the launch of awareness month. (PHOTO: DAVID NJAAGA/STANDARD)

Holders of unclaimed financial assets have until November 1 to surrender them or risk being penalised.

The Unclaimed Financial Assets Authority (UFAA), an outfit mandated to manage unclaimed assets, warned the holders of the assets - who include commercial banks, insurance companies, Saccos and utility companies- of punitive action including being slapped with a fine of up to 25 per cent of the value of unclaimed assets.

UFAA CEO Kellen Kariuki said: “In a month’s time, all institutions, financial or otherwise, will surrender the financial assets deemed unclaimed as per the provisions of the unclaimed financial assets Act.”

Mrs Kariuki noted that the primary responsibility of re-uniting the unclaimed assets with their owner rests with the holding institutions. “The institutions only surrender the assets to UFAA in the event that they cannot trace the whereabouts of the beneficiaries,” she said.

Some of the unclaimed financial assets the association will be expecting include travellers’ cheques, money orders, cheques, life endowment insurance policies and assets from dissolved business entity. Others are deposits for utility services such as electricity bills and water, order by a court for refund by holder, and ownership of interest including dividends.

UFAA estimates that Sh100 billion is yet to be submitted from companies but it will do an audit to get an exact amount of money. A survey by the Unclaimed Property Asset register found that insurance firms hold 25 per cent of unclaimed funds. Other major holders of idle assets are pension funds and public listed companies.

About two million Kenyans have their money idle in an account at the Central Bank of Kenya as unclaimed assets. UFAA says about 60 companies have so far surrendered Sh3.3 billion. “The money is at the Central Bank in a trust account. We have so far invested in Government securities,” Kariuki said at a media briefing in Nairobi two weeks ago. She said that only Sh32 million has been claimed to date.

Kenya Bankers Association CEO Habil Olaka said Kenyans are finding it difficult to keep track of small deposits of money in accounts with banks and utility companies.

“Many customers also have un-cashed mobile money receipts, dividend cheques or health insurance re-reimbursements,” said Mr Olaka, attributing the occurrences to current mobile lifestyles. “The result is that we lose contact with our financial providers and our money is considered unclaimed or abandoned,” he concluded.

KBA and the authority yesterday launched an awareness campaign on unclaimed financial assets. “We thank our partners like KBA and their willingness to share information. About 62 per cent of the unclaimed financial assets we have are remitted by KBA. It is enormous but we demand more from all holding institutions,” said Ms Kariuki.

She said during the October awareness month, they'll target three main issues, reuniting customers with their unclaimed financial assets, transfer of abandoned funds to the authority and formalising the process of industry compliance.

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