Civil servants to sue state for pensions

One of the biggest class actions against the state pension fund will unfold later this month.
More than 80,000 former Transkei civil servants from Butterworth, Sterkspruit, Mthatha, Matatiele, Kwa Bhaca, Maluti, Mzimkhulu, Kokstad, Komani, Lusikisiki, Ntabankulu and Flagstaff are taking on the state over the way their pensions were transferred from the old SA fund to the new.
They are calling on all disgruntled pensioners to come forward so they can sue the Government Employment Pension Fund (GEPF).
The GEPF was started in 1996 but some civil servants say they has been paying towards their pensions since 1976 but their pensions were not integrated into the new system.
A committee formed by the pensioners has launched a case which will be argued in the North Gauteng high court on October 29.
One of the committee members, Thobile Ndabambi, said he had been working for the department of defence for 10 years but he was only paid out a pension for two years.
“There are many people who have been affected by this who have died due to stress-related conditions.
“It seems as if the government does not care about our plight.
“We are not asking for any favours, but we are simply asking the state to pay us what is due to us, money that we worked for,” Ndabambi said.
In their court papers, the group said GEPF was in breach of the civil servants’ constitutional rights.
The members, they say, sustained damages and suffered prejudice due to the governments mishandling of their exit from the Transkeian Government Service Pension Fund when they were incorporated into the GEPF.
Public service and administration minister Ayanda Dlodlo told journalists that, as of May, there were 44,190 cases of unclaimed and unpaid benefits.
The Government Pensions Administration Agency (GPAA), which is responsible for administering pensions on behalf of the GEPF, stated that it had 26,919 cases of unpaid benefits, amounting to R907.1m, and 17,271 cases of unclaimed benefits, valued at R698.9m.
GPAA spokesperson Mack Lewele said: “We are however unable to comment on the matter because it is before the courts.”



Exclusive Exposé: ‘Businessmen’ make millions peddling empty promises and false hope

“Not one of the ‘beneficiaries’ I brought in has ever been paid. Yet, they were all told that they had unclaimed benefits in their name and they were all given a figure as to how much was available.”

The origin of Sean Westcott’s business can be traced back to Eldorado Park in Gauteng.
Similar to the legends of the mythical city of gold which enticed explorers for two centuries to partake in quests for untold riches… Rumours of guaranteed wealth have drawn crowds of people desperately searching for a way out of their financial difficulty to Donafin in Eldorado Park.
According to a client of Donafin, whose identity is known to the Vryheid Herald but cannot be published due to fear of intimidation, the business was started by Leon Lincoln who, in the beginning, worked from the garage of his Eldorado Park home.
“In 2013, the business was called BrownLinc. After a while the name changed to NewMindz and then to Donafin. It is still operating as Donafin in Eldorado Park but from different premises,” said the associate.
“I went there after hearing through word of mouth that they were able to trace unclaimed benefits. A close relative of mine had passed away and I wanted to know if there was a pension fund in her name. The yard was full of people.
“When it was my turn, they took my relative’s ID and death certificate and told me I needed to wait a few minutes while they did their search. A few minutes later, they called me and told me there was more than half a million rands in unclaimed benefits and they asked for R1 100 admin fee so that they can get the money paid into my bank account,” said a client of Donafin.
“I paid the admin fee and they told me the money would be in my bank account in six months.”
Two years later, this client of Donafin has not received the money that was promised.
“Leon approached a group of clients and recruited them as agents. He said that he was increasing his fee to R1 200 and would pay R200 for each new client introduced to the business. I brought in hundreds of new clients.
“Not one of the ‘beneficiaries’ I brought in has ever been paid. Yet, they were all told that they had unclaimed benefits in their name and they were all given a figure as to how much was available,” said an associate of Mr Lincoln’s. “These people are so angry and they want their money.”
One doubtful Eldorado Park client went to the FSCA for confirmation after she was told by Donafin that she had R190 000 in unclaimed benefits in her name.
She has provided the Vryheid Herald with documentary proof from the FSCA that indicates that she does not have a cent in unclaimed benefits to her name.
Residents of Eldorado Park said that Leon Lincoln has shamelessly flaunted his newfound wealth, buying flashy vehicles and investing in his home.

Sean Westcott was introduced to Leon’s Eldorado Park clients in June last year as the ‘paymaster’ from Cape Town who would ensure that all outstanding money would soon be paid out to Donafin’s increasingly disgruntled clients.
It wasn’t long thereafter, that Mr Westcott opened a Donafin branch in Vryheid. In June, two days prior to the Hawks raiding the Vryheid business, Donafin had changed its name to Tovasize, but continued to operate in exactly the same manner as before. Mr Westcott, however, rebuffed any further association to Donafin.
“No one in Eldorado Park is aware that Sean is now operating in Vryheid. He just seemed to have disappeared suddenly,” said another associate of Mr Lincoln’s.
A Vryheid couple has confirmed that Donafin in Vryheid (now Tovasize) operates in exactly the same manner as Donafin in Eldorado Park.
“We heard from friends of ours, that there was this tracing company in town that could track unpaid benefits and surplus funds in your name. I accompanied my husband there and they took his ID number and told us there was R294 000 in his name. We paid the R1 500 admin fee believing that we were going to get R294 000 back, but we still haven’t received any money. What makes us suspicious that this is a scam is the fact that the people before us and the people after us were also told they had unclaimed funds. How can everybody have unclaimed funds in their name?”

Hawks investigators have confirmed that a similar business has also opened in Nongoma, and they are looking into claims that one may be operating in Newcastle.
Anyone with further information is urged to contact Estella Naicker of the Vryheid Herald on 079 256 7570.



Government pension fund has R1.6bn in unclaimed benefits

The government is urging former public servants and their beneficiaries who may be owed benefits by the Government Employees Pension Fund (GEPF) to contact the fund.
The GEPF owes R1.6 billion in unpaid and unclaimed benefits. 
Last week, Public Service and Administration Minister Ayanda Dlodlo said that, as of May, there were 44 190 cases of unpaid and unclaimed benefits. 
The Government Pensions Administration Agency (GPAA), which is responsible for administering pensions on behalf of the GEPF, says it has 26 919 cases of unpaid benefits, amounting to R907.1 million, and 17 271 cases of unclaimed benefits, valued at R698.9m. 

Most of the unclaimed and unpaid benefits (R514.1m) are owed to the beneficiaries of people who used to work at national government level.
One of the reasons benefits have not been paid is the submission of documentation that contains incorrect information about the identities of beneficiaries, as well as incorrect tax and banking details.
Dlodlo called on all stakeholders, including government departments and trade unions, to notify public servants about their benefits and that they need to apply for them.
The GPAA says it plans to work with community workers to track down beneficiaries. It will also hire 20 full-time tracing agents and 10 external service providers to trace beneficiaries. Other intervention strategies, such as the deployment of mobile vans and national road shows, are being explored.
“The minister calls on family members or beneficiaries of deceased former public servants to contact the GEPF to ascertain whether they are entitled to any unclaimed pension benefits,” the department said.
Former public servants or their beneficiaries should visit their “closest regional walk-in centres of the GEPF in all nine provinces” to apply for their benefits.
Unpaid and unclaimed retirement fund benefits have been a problem for many years. The Financial Sector Conduct Authority estimates that more than R20bn is due to more than three million people.



Liberty in shock admission it erred in deregistering 130 funds

Liberty’s admission that 130 pension and provident funds must be reinstated years after industry-wide cancellations of thousands of dormant funds could bolster a case before the Constitutional Court.
Speaking at Liberty’s interim results for the six months to June on Thursday, CEO David Munro said it had erred in deregistering 130 funds with about R100m in assets when it cancelled around 4,600 dormant funds about a decade ago.
This could affect up to 3,000 beneficiaries, said Tiaan Kotze, CEO of Liberty Corporate.
It had successfully reinstated 25 of these through a high court process and had recommenced payments. Liberty would look for ways to reinstate the remaining 105 funds more expeditiously, Munro said.
"There’s a lot of noise around this matter and we want to be clear that we take it very seriously. We are prepared to go back and look at our actions, and where we’ve made mistakes, to rectify them," Munro said.

Liberty, which found that funds needed to be reinstated following its own investigation, is the first retirement fund administrator to admit as much.
"I congratulate Liberty on making these disclosures and wish other fund managers would do the same," Rosemary Hunter, the previous deputy registrar for pension funds at the Financial Sector Conduct Authority, said.
She has argued that the cancellations project, in which the regulator approved the cancellation of nearly 7,000 pension funds from 2007 to 2013 on the grounds that they had ceased to exist because they no longer had properly constituted boards, was illegal.
After two high court rulings and the Supreme Court of Appeal dismissing her case against the regulator, Hunter approached the Constitutional Court. She is seeking an order that all the funds be investigated and is now awaiting judgment.
For Liberty, reinstating these funds represents an administrative expense at a time when the embattled insurer is trying to cut costs as part of a turnaround.
Separately, Liberty disclosed an amount of R2.2bn in unclaimed benefits, saying it was actively locating 75,000 of the 100,000 beneficiaries to whom this money was due.
Whatever resources were required to trace beneficiaries and reinstate wrongly cancelled funds would be made available, Munro said. Liberty had made "meaningful progress" on its turnaround, which involved simplifying its product set and internal structure.
For the six months to June, normalised operating earnings jumped 18% to R958m. While a considerable improvement on the six months to June 2017, this is still behind the R1.1bn posted for the six months to June 2016, signalling it still has some way to go to return to what chairman Jacko Maree has previously described as its "former glory".
It would be critical to better integrate with parent Standard Bank for distribution and customer data, as had been done with the short-term insurance joint venture, said Avior Capital Markets analyst Warwick Bam.
"As long as its core affluent consumer remains moribund and the competitive environment remains unrelenting, Liberty’s pursuit of sustainable growth will be a bit like trying to boil the ocean," said Justin Floor, a portfolio manager at Kagiso Asset Management.


State calls on former employees to collect unclaimed benefits

The government has called on retired public servants and their beneficiaries to apply for unclaimed and unpaid pension benefits, which amount to more than R1.6bn.
Public Service and Administration Minister Ayanda Dlodlo said on Monday the Government Pensions Administration Agency (GPAA) had 44,190 cases of unpaid and unclaimed benefits as of May 2018.
The GPAA administers pensions on behalf of the Government Employees Pension Fund (GEPF). Unclaimed benefits are accumulated as a result of the rejection of incorrect documentation, including the identity of beneficiaries, as well as member tax matters, incorrect banking details and family disputes.
While unpaid benefits are settlements that are more than 24 months old from the exit date of employees from the public service, the mode of exit is unknown and there were no exit documents, resulting in amounts being based on the minimum benefit payment.
The GPAA is dealing with 26,919 cases of unpaid benefits that amount to R907.1m, while there are 17,271 cases of unclaimed benefits valued at a total of R698.9m.
Dlodlo called on government departments and trade unions, among other stakeholders, to alert public servants to the benefits and the need to apply.
"The minister also calls on family members and/or beneficiaries of deceased former public servants to contact the GEPF to ascertain whether they are entitled to any unclaimed pension benefits," read a statement issued by the department.
Long-Standing Issue
The country has had a problem with unpaid and unclaimed retirement fund monies for years, with the Financial Services Board estimating more than R20bn is due to more than 3-million people.
This was mainly due to invalid contact details on pension and provident fund members’ records, emigration and death, among other reasons.
While some of the former employees would have been paid upon retirement, more monies could have accrued thereafter, which would also be owed to them.
The GPAA planned to work with community development workers and hire 20 full-time tracing agents and 10 external service providers to trace beneficiaries. Other interventions included the deployment of 10 mobile vans in all provinces and quarterly national road shows.
The highest amount of unclaimed and unpaid benefits, at R514.1m, was at national government level.
Meanwhile, KwaZulu-Natal provincial departments came second, with R370.2m in unclaimed benefits.
The GPAA has a backlog of 14,932 cases.
Dlodlo said former public servants who had not claimed their pension benefits should approach their "closest regional walk-in centres of GEPF in all nine provinces to apply for their unclaimed benefits".



The Government Pensions Administration Agency(GPAA) says that cases of corruption and maladministration involving unclaimed pensions are being investigated by the Commercial Crime and Assets Forfeiture Units.
The GPAA has also confirmed that over R400 million remains unclaimed by pensioners or their families.
Eyewitness News began investigating the unclaimed pensions after being approached by several people who claimed that pension funds were being looted.
The GPAA has dismissed reports that an internal investigation has found that at least R100 million is unaccounted for.
However, the agency’s Mack Lewele says corruption within the agency is receiving attention.
“The corruption report that we received [was] investigated internally in the organisation and we found that there was cause to following them up.”
Lewele has called on the families of deceased government employees to come forward so that the appropriate funds can be allocated.



Ex-mineworkers to claim for unemployment insurance

There is still time for ex-mineworkers who left employment in the mines prior to 1 April 2002 to make applications for unclaimed benefits from the Unemployment Insurance Fund (UIF).
This can be done during departmental visits and follows after a successful campaign for unclaimed benefits by the Department of Labour in the Frances Baard and parts of the Pixley ka Seme District from 30 May to 26 June.
The campaign started in Hartswater, and already yielded positive results with a turnout of 729 applicants and 358 applications already processed for payment.
Kebalepile Khula, the Northern Cape’s communication officer of the Department of Labour, says all ex-mineworkers who left their employment after 2002 will be assessed in line with the Unemployment Insurance Act of 2001.
The department urges all potential ex-miner applicants to bring along several documents for verification: an identity document, access card and IRP5 (from the previous mine employer), old “blue card”, previous salary advice or any proof of mine employment (including “Ma­khulu’s kop” card, “dompas” or Teba record).
The dates of the campaign in the John Taolo Gaetsewe District, where mineworkers can be served free of charge, will be communicated.