2015-06-27

Unclaimed life insurance benefits exempted from prescription laws

Tracing beneficiaries

From 1 June 2013, life insurers will be obliged to start the process of tracing policyholders or beneficiaries within six months of the assets becoming payable, either as a benefit or a maturity payment.
Should this process not match the rightful owner with the assets, the life company repeats the tracing process within a three-year period and again within 10 years if the assets remain unclaimed. If after 10 years, the life company cannot trace the beneficiaries or policyholder, an external tracing company must be used. This requirement may only be waived is if the assets are worth less than R1 000 and the cost of tracing exceeds the amount available.

In terms of the Standard, any reasonable administrative and tracing costs incurred after the first attempt to trace the rightful owners may be recovered from the unclaimed assets.

THE National Union of Mineworkers has blamed the Financial Services Board for R15-billion in unclaimed retirement funds.

THE National Union of Mineworkers has blamed the Financial Services Board for R15-billion in unclaimed retirement funds.
The FSB recently reported R15-billion was still unclaimed and trustees were scrambling to get hold of beneficiaries.
The board said that 70% of the money belonged to former mineworkers.
NUM health and safety secretary Erick Gcilitshana said the money would long have been claimed had the FSB released names of the beneficiaries.
"The challenge is [the] FSB chamber and trustees which consist of members that are reluctant to release names of the people who are owed," Gcilitshana said.
"If we can get the names of those people we direct to get help."
However, FSB deputy executive officer for retirement funds Rosemary Hunter said they were as concerned about the unclaimed funds.
"We are deeply concerned about the increasingly high number of unclaimed benefits and want to find ways to help funds trace and pay their beneficiaries, both local and foreign," said Hunter.
She said employers have a duty to assist employees to claim benefits from funds in which their membership has contributed to.
"Employers should not simply abandon their employees whose employment has been terminated to 'fend for themselves' in claiming their benefits," Hunter said.
She added that trust funds should insist that employers supply them with up-to-date contact information of employees.
Hunter said the main problem lay with members who did not know that they were entitled to benefit from the fund to which they contributed while employed.
"Sometimes migrant workers who have to leave the country quickly after termination of employment do not know how to claim the benefit from their own country or else a member was deceased and dependants may not have been aware that there was a benefit payable on the member's death," Hunter said.

http://www.sowetanlive.co.za/business/2014/11/08/miners-r15bn-unclaimed---num-accuses-fsb-for-unpaid-benefits

Former miners paid out R450m in previously unclaimed benefits in past year

Mining Weekly Online reports that in the past year, R450-million in claims have been paid to former Southern African miners to compensate them for unpaid pension, provident fund and service-award benefits. 

But, given that this made only a small dent in the estimated R6-billion that is owed by the Mineworkers Provident Fund (MPF), the Mines 1970s Fund, the Sentinel Mining Industry Retirement Fund, the Rand Mutual Assurance Company and the Fidentia-linked Living Hands Umbrella Trust, besides others, there is still much left to be done.  From the MPF, which seems to have most of the unclaimed benefit – about R3-billion – 15% had been paid out.  Executive director of the nonprofit facilitator Southern Africa Trust (SAT), Bhekinkosi Moyo, said this was a big success.  “From zero disbursement [from MPF], to almost R250-million; for us it is a lot.  We are happy to see that the funds are trying to disburse these claims as soon as possible.”  He added that there were almost 300,000 miners that still needed to claim for unpaid benefits, while many former miners had been traced during the past year.  SAT programme manager for social capital, Christabel Phiri, said these funds were facing a number of issues, including a lack of detailed information.  Besides the issues around information dissemination, there were also issues around legislation, which was a barrier that affected the social security funds in terms of tracing beneficiaries.  Moyo outlined that the establishment of a centralised database would go a long way in helping to overcome many of the challenges faced.  “Rather than having databases all over, with four or five funds carrying different databases for the same person, because the information is not shared, [we want to have all information in the same place].”  Such a database would ideally be managed by the FSB and the Regulatory Services Board, with oversight by government.  Moyo also noted that a lot of the initiatives that were happening needed to be harmonised.

http://www.salabournews.co.za/index.php/component/content/article/70-labour-news/24060-former-miners-paid-out-r450m-in-previously-unclaimed-benefits-in-past-year.html

Campaign underway to trace 200,000 ex-mineworkers owed R5bn in unclaimed benefits

Mining Weekly Online reports that a campaign is under way in the mining industry to find more than 200,000 former mineworkers who are owed at least R5-billion in unpaid provident fund, occupational disease and service-award claims.  Disabled or sick former mineworkers can potentially gain upwards of R500,000 each and provident fund payouts for 10 to 15 years’ service can amount to hundreds of thousands of rands apiece.  But, at least half of the 200,000 are unaware that money is owed to them, despite having valid, uncontested claims.  If the current unsuccessful disbursement methods are continued, the already large financial backlog will grow even larger.  But, Teba Limited, which has a database of more than 1.5m records is advocating new ways of resolving the problem.  CEO Graham Herbert believes Teba could assist in eliminating the backlog in three years.  For instance, it is already dealing “very constructively” with the Medical Bureau for Occupational Diseases in tracing 200,000 mineworkers with assessed lung damage.

http://www.salabournews.co.za/index.php/press-releases/16995-campaign-underway-to-trace-200000-ex-mineworkers-owed-r5bn-in-unclaimed-benefits.html

Unclaimed Benefit Strategies Reviewed

Retirement fund benefits that remain
unpaid for a period of 24 months gain the
status of unclaimed benefits. This
happens when members do not claim
their benefits which often happens when
employees abscond or go absent without
consent. It is no longer permissible for
unclaimed benefits to revert to the fund
and become part of its assets after a
period of time. The benefits must either
remain in the fund or be transferred to an
unclaimed benefits preservation fund.

http://www.simekaconsult.co.za/downloads/Consulting%20services/simeka%20publications/baobab%20bulletin/For%20intranet%20-%20do%20not%20move%20or%20change%20names/feb%202012/Page%201.pdf

Moriting Unclaimed Benefits Preservation Provident Fund

Moriting Unclaimed Benefits Preservation Provident Fund

Registered name: Moriting Unclaimed Benefits Preservation Provident Fund
Registration number: 12/8/38042/1
Registered address: 4th Floor Marble Towers, 208-212 Jeppe Street, Johannesburg, 2000
Principal Officer & Sponsor Trustee: Bryan Shuping
Sponsor Trustee: Ntsiki Msibi
Independent Trustee: Johannes Mangoejane
Independent Trustee & Chairperson: Johannes Mangoejane
Auditor: Tony Lund & Kieck Inc.
Valuator: Alex Scott of CA Scott Consulting Actuaries
Tracing agent: XDS
Administrator: Moriting Wealth Managers (Pty) Ltd
Bank: Standard Bank
Investment Managers: Sasfin

Investment Strategy: As the benefit has already vested to the member, the fund follows a conservative investment strategy. The objective of the investment strategy is to ensure liquidity and preserve capital while offering a real return on investment.
Investment Benchmark: To achieve a real return of inflation plus 3% over 3 year rolling periods.
Tracing Policy: The fund endeavours to trace all members and beneficiaries as timeously as possible. The services of XDS as a tracing agent have been secured based on their infrastructure and network both locally and in neighbouring countries. As fees are only payable on a successful trace XDS is further incentivised to trace members and beneficiaries as quickly as possible.

Standard Services:
  • Financial Management
    • Maintain accurate record of transactions
    • Monthly bank reconciliation
    • Interest and bonus declarations to member records
    • Payment of fund expenses
    • Payment of adhoc expenses
    • Annual Financial Statement preparation
    • Submission of Financial Statements
  • Data Management
    • Take on of new members
    • Maintenance of member records
  • Benefit Payments
    • Calculation of benefit with declarations
    • Tax application
    • Banking details verification
    • Claim documentation to members
  • Reporting
  • Quarterly reporting
    • Board of Management
    • South African Reserve Bank
Fee Structure: The fund follows a simplistic approach to fees with complete transparency to fee calculation. Only a monthly fee applies, with no initial fee, investment fee or benefit payment fee thereby enforcing the philosophy of preserving member's benefits.
  • Administration cost: R10 per member per month
  • % of assets: Not applicable
  • Take on fee: Not applicable
  • Annual investment fee: Not applicable
  • Benefit payments: Not applicable
  • Minimum charge: Not applicable
  • Fund expenses * As and when
  • Tracing fee: R155 per successful trace
* Audit fee
* FSB Levies

http://www.moriting.com/index.php?option=com_content&view=article&id=70&Itemid=76

State coffers have R456-million in unclaimed pensions

The Government Pensions Administration Agency is attempting to trace the beneficiaries of R456-million in pension money.



  Thousands of former civil servants have not claimed R456-million in pension money, the Government Pensions Administration Agency (GPAA) said on Tuesday.
“We have approached the department of home affairs and credit bureaus to assist us in the tracing of the beneficiaries,” chief operating officer Jay Morar told reporters in Pretoria.
“In addition, we have embarked on a tracing initiative in which we have engaged the services of a tracing company. Through this company, we have managed to record modest success.”
In December, the uncollected benefits amounted to R456-million, owed to 17 000 former civil servants.
Former provincial government department employees had not claimed R271-million, while former national government department employees had not claimed R185-million.
“There is a touching case of one gentleman, in township lingo called a ‘street kid’ or ‘hobo’. He was found living under a bridge in Soshanguve, Pretoria, unaware that he is the rightful beneficiary of several hundreds of thousands of rands worth of benefits,” said Morar.
“Subsequently, he was paid what is due to him, allowing him to return to the studies that he had been forced to abandon after the death of his mother.”
The GPAA is a government agency that reports to the finance minister. It is mandated to administer pensions on behalf of the Government Employees Pension Fund and national treasury.
The agency’s financial affairs are governed by the Public Finance Management Act while its human resources arm falls under the ambit of the Public Service Act.
In the 2013/14 financial year, the GPAA received R52-billion in pension contributions from members and employers. In the same period, 62 771 benefits were paid to outgoing public servants.
Morar said on average the GPAA received 2 239 resignations per month. It had processed an average of 749 deaths per month over the past seven years. – Sapa


http://mg.co.za/article/2015-02-10-state-coffers-has-r456-million-in-unclaimed-pensions/

Over R456m of unclaimed benefits for government employees

10-2-2015
By More Matshediso
Pretoria - Acting Government Pensions Administration Agency (GPAA) Chief Operations Officer, Jay Morar, says there is about R456 million worth of unclaimed benefits for Government Employees Pension Fund (GEPF) members, as at December 2014.
Briefing media on Tuesday, Morar said the money translates into approximately 17 000 individual cases.
“Provincial departments account for R271 million, while national departments account for R185 million… We (GPAA) are the first to admit that one untraceable case is too many and is giving us countless sleepless nights,” he said.
Morar said GPAA is faced with a challenge of unclaimed benefits, due to Bank rejections wherein GPAA is unable to rectify incorrect banking information as the client is untraceable.
He said some of the challenges include cases that are submitted with incomplete documentation by departments; unclaimed funeral benefits; and other unclaimed benefits (as the member’s tax affairs are not in order, there are incomplete documents, disputes among others).
He said the majority of unclaimed benefits are in KwaZulu-Natal and most of them belong to poor or previously disadvantaged categories of people in rural areas, who do not know that they have benefits due to them, including their beneficiaries.
Tracing beneficiaries
Morar said GPAA has approached the Department of Home Affairs and credit bureaus to assist in tracing beneficiaries of unclaimed benefits.
“We have embarked on a tracing initiative in which we have engaged the services of a tracing company. To this end, through this company, we have managed to record modest success,” he said.
He said GPAA staff members also conduct first-level tracing, which includes using the minimum information at their disposal to call anyone who might be related to the untraceable beneficiary.
“We have [also] started preliminary discussions with the Department of Public Service and Administration (DPSA) on how it can support and assist us in our tracing initiatives,” said Morar.
Increased accessibility
Morar said GPAA has been piloting the (modernisation) paperless project in the past two years, in which all documents are submitted electronically.
“To date, modernisation has made substantial progress with our Business Payment Automation project during the year, particularly with eChannel, the electronic ‘post-box’ system for delivering exit documentation directly from employer departments to the GPAA,” he said.
Morar said GPAA is in a process of increasing satellite offices across the country, including in Venda, QwaQwa and Rustenburg.

http://www.sanews.gov.za/south-africa/over-r456m-unclaimed-benefits-government-employees

Paying those who need it most

At FedGroup, a family-owned company that has grown to become South Africa’s leading independent financial services group, we’re in the business of paying benefits.
That is why we aim to exceed the industry standard in tracing and tracking the beneficiaries of unclaimed benefits.

Paying those who need it most

Unclaimed benefits are defined as those not paid by a fund to a member, former member, or beneficiary within 24 months of the date on which it became legally due and payable.
As legislation within the Pension Funds Act and Revenue Laws Amendment Act dictates that funds cannot remain in an active provident fund indefinitely, unclaimed benefits have to be transferred into an unclaimed benefit fund. These funds are therefore established to receive and administer these unclaimed benefits, which originate from various retirements funds where members or beneficiaries have not claimed the benefits that are due to them.
The main purpose of unclaimed benefit funds is therefore to provide a vehicle to safeguard benefits and to trace members or beneficiaries in an effective and efficient manner, ensuring that the funds get to those for whom they were intended.

The funds are governed by their own rules, which are registered with the Financial Services Board (FSB) and are approved by the South African Revenue Service (SARS).

http://fedgroup.co.za/retirement/unclaimed-funds/

Momentum - Understanding our unclaimed assets process

 Unclaimed assets refer to any monies due to a person that remains unpaid or unclaimed. To enable us to process the claim, we will need to contact you or your beneficiaries. To make sure that we are able to do this, it is very important that you inform us of any changes to your or your beneficiaries’ contact details.
If we are unable to reach you or your beneficiaries on the contact details you have provided us, you give us consent to carry out the following additional procedures, in accordance with the ASISA Standard on Unclaimed Assets, in our attempt to process the claim:
  • We will try to contact you or your beneficiaries using any contact details, which may be available to us on our internal database. This includes historic records and records held by different divisions within MMI Group Limited.
  • If we are still unsuccessful, we will try to obtain your or your beneficiaries’ most recent contact details from external information providers (eg the Department of Home Affairs or a credit bureau).
We want to make sure that we pay all unclaimed assets. This means that we will follow the above procedures within the first six months of the claim conditions being met and again after the first three years. If the assets are still unclaimed after ten years of the claim conditions being met, and we are still unable to contact you or your beneficiaries, we will appoint an external tracing company to trace you and/or your beneficiaries.
Tracing fees will be deducted from the benefit we pay. These costs are not determinable at this stage and will depend on the tracing activities involved.

Any unclaimed assets will earn growth according to our practice for handling late payment of assets.

https://www.momentum.co.za/for/you/client-protection/unclaimed-assets

Bid to free up unclaimed pension benefits

Billions of rands in unclaimed retirement benefits could be released into the hands of current and former retirement fund members, including pensioners, if an application to the Gauteng High Court is successful.


If the application succeeds, it could have major implications for the economy as money locked up in interest-earning deposits becomes available.
But success could create new complications, warns top pension funds lawyer Jonathan Mort, who believes that the application should succeed.
The application has been brought by Tony Mostert, the liquidator of the Picbel Groepvoorsorgfonds. This is one of a number of retirement funds, of which Mostert is either curator or liquidator, that were subject to surplus-stripping by employers in the 1990s.
Mostert wants the court to declare ultra vires (literally, beyond the powers) and unenforceable the regulations issued under the Pension Funds Act that require unclaimed retirement fund surplus benefits to be transferred to contingency reserve funds, including unclaimed-benefit funds and the Guardian’s Fund.
The Financial Services Board (FSB) and the Minister of Finance, among others, are named as respondents, but it is not yet clear whether they will oppose the application.
The FSB issued a brief statement saying it is not in a position to respond at this time, because the Registrar, FSB chief executive Dube Tshidi, “is currently studying the application to determine the most appropriate response”.
However, it is understood that both the FSB and National Treasury are unlikely to oppose the application.
Mostert’s application is narrowly focused on retirement fund surplus benefits due to former members of the Picbel fund who cannot be traced. But any court decision in favour of Mostert’s application is likely to set a precedent that will have an impact on the many billions of rands of other unclaimed retirement fund benefits from surpluses and in respect of ordinary benefits that members have not claimed.
The value of unclaimed surplus benefits in all funds is currently unknown, but the FSB is doing an audit, and the value is expected to exceed a billion rands. However, there is an estimated further R25 billion or more in unclaimed retirement fund benefits due to members who left funds as a result of resignation or retrenchment or who reached pensionable age, and dependants of fund members who died before retirement.
FSB deputy executive in charge of retirement funds, Rosemary Hunter, indicated in a book on the Pension Funds Act she wrote before her appointment to the FSB that she is in agreement with Mostert’s view.
Hunter also questioned the validity of the disputed regulation at the recent Pension Lawyers Association annual conference, but added that while the regulation was in place, the FSB was obliged to enforce it.
Mostert argues that the regulation governing unclaimed surplus benefits is inconsistent with and contradicts other provisions of the Pension Funds Act. He says that no legal provision is made for the release of funds from a contingency reserve account or the Guardian’s Fund, even when there is no reasonable possibility of a beneficiary being traced.
He says that when the regulation was promulgated in April 2003, the Minister of Finance had “no power to make regulations that are inconsistent with legislation passed by Parliament” and they are “ultra vires and therefore void”.
Mostert says: “The regulation is, in any event, irrational, since it is incapable of achieving any legitimate object contemplated by the Pension Funds Act.”
Mort agrees with Mostert, saying the disputed regulation is in breach of the provisions of the Act and was “promulgated in excess of the power of the Minister of Finance”.
He says: “I am not saying that the former members should not receive what is due to them – they should – but rather that where they are not traceable, for whatever reason, then the surplus amount should revert to the fund.”
Mort says that if Mostert’s application is successful, it will make “a very significant difference to many pension funds that have been sitting on undistributed surpluses in the form of unclaimed benefits”.
He says there is no reason, where there is no reasonable prospect of unclaimed benefits being paid because the beneficiaries cannot be traced, they should not be allocated first to improving the solvency of defined-benefit funds and thereafter being distributed among other stakeholders, including active members, former members, pensioners and employers.
But he warns there will be consequences if the application is granted. These include:
* Funds may need to amend their rules to allow money retained in a contingency reserve account to revert to the fund. He says the FSB should allow the rule change. It was a common provision in the old defined-benefit funds that unclaimed benefits could, after a certain period, revert to the fund.
* Funds will have to do a proper assessment that all reasonable steps have been taken to trace members to justify the transfer of surplus amounts back into a fund.
* Many funds have already transferred unclaimed benefits to unclaimed-benefit funds, and they may seek to have those returned to them. Mort says that, as far as he knows, there is no basis in law for compelling an unclaimed-benefit fund to return benefits, but it may be that some unclaimed-benefit funds would be prepared to co-operate.

DISPUTED REGULATION
The disputed regulation 35(4) of the Pension Funds Act reads:
“Where a board (of trustees) is able to determine the enhancements due in respect of a particular member in terms … of the Act, but is unable to trace that former member in order to make payment, the board shall put the corresponding enhancement into a contingency reserve account specific for the purpose. Notwithstanding anything in the rules of the fund, monies may not be released from such contingency reserve accounts except as a result of payment to such former members or as a result of crediting the Guardian’s Fund or some other fund established by law to include such payments.”

LEGAL ISSUES SURROUNDING LIQUIDATED FUNDS
Unclaimed retirement fund benefits were ill-defined before November 1, 2008, when the Pension Funds Act was amended to recognise pension fund entitlements that had not been paid to the rightful beneficiaries.
In terms of the Act, an unclaimed benefit from a retirement fund is any amount, whether it is a benefit at retirement, resignation or retrenchment, or a death benefit due to dependants of a fund member, that has not been claimed 24 months after the date on which the benefit became legally due, or a longer period that can be justified by a fund’s trustees.
The Act includes any unclaimed or unpaid benefits due in terms of a surplus apportionment, and any unpaid or unclaimed benefits due to members or former members when a fund is deregistered or liquidated.
Most unclaimed benefits result from three things:
* Poor record-keeping by retirement funds or fund administrators.
* Employers and fund administrators destroying paper-based employee records after a number of years. There is no legal requirement to retain documentation of former employees.
* Members, particularly when they leave employment, failing to update contact details. And in the case of death benefits, members failing to register the names and contact details of their dependants with the fund.
When the period expires, the trustees must decide how to manage the unclaimed assets. This may include transferring them into an unclaimed benefit fund, registered with both the Financial Services Board (FSB) and the South African Revenue Service. Unclaimed benefits can also be transferred to the Guardian’s Fund (see “Guardian’s Fund ‘has unreliable records’”, below).
But the problem becomes complicated when retirement funds are destined to be liquidated.
Currently, all transfers between retirement fund vehicles are governed by section 14 of the Pension Funds Act, which aims at protecting members. However, liquidations are exempt from the provisions of section 14 and FSB directives on transfers. This creates a problem for retirement funds and fund liquidators.
When the legislation governing the apportionment of surpluses in retirement funds was implemented in 2006, it was established that, of the more than 13 000 registered retirement funds, only about 3 500 were “active” funds.
National Treasury’s view at the time was that non-active retirement funds should be closed down.
Many thousands of funds were deregistered. Most were dormant funds with no boards of trustees and no contributing members. Some had no assets or liabilities. Others had assets and liabilities for unclaimed benefits.
The FSB allowed the funds to be liquidated and any assets to be transferred to unclaimed-benefit funds.
However, when pension fund lawyer Rosemary Hunter was appointed FSB deputy executive in charge of pension funds in 2014, she was concerned that the methodology used was not legal.
Her review of the legality of the fund closures was driven by a concern that, if any assets and liabilities had not been fully accounted for, some members, former members or their dependants may have lost out. She was also concerned that insufficient effort may have been put into locating the beneficiaries of the unclaimed benefits.
Hunter gave the assurance at the time that the FSB would re-open only those funds where it had reason to believe that the cancellation process may have caused substantial prejudice.
Hunter’s department has since been investigating whether defects in the ways in which dormant funds were closed in the past may have resulted in substantial prejudice to any of the funds or their members or former members. If it appears that there may have been substantial prejudice to fund members, the former administrators are being asked to fix the problem.
These developments raised concerns in the retirement fund industry because of the costs involved in revising the closures. There is also now no clarity on how and when a fund can actually be liquidated.
Hunter told the recent Pension Lawyers Association conference that the FSB is about to publish a draft notice of its intention to withdraw the exemption it granted funds from having to apply to the FSB to transfer assets into unclaimed benefit funds in terms of section 14 of the Pension Funds Act.
She says the FSB is concerned about transfers of benefits to unclaimed-benefit funds occurring without enough being done to trace members, and once a transfer to an unclaimed-benefit fund has occurred, the link to employer records may be broken. Requiring funds to apply for a section 14 transfer before transferring the benefits will allow the FSB to supervise the transfers.
Hunter says that, before scrapping the exemption, it will consider the industry’s views.
Of the 13 143 funds registered at the end of December 2006, between January 1, 2007 and February 13, 2014 a total of 8 298 funds were cancelled or liquidated. These consisted of 1 494 voluntary dissolutions and 6 804 cancellations of registration “on proof, to the registrar’s satisfaction, that the fund had ceased to exist”.
The transfer of members’ benefits was approved in the case of 1 208 funds, and 2 105 funds were closed. Another 1 204 funds were in the process of deregistration, but were not yet cancelled.

GUARDIAN’S FUND RECORDS ‘UNRELIABLE’
The management of the Guardian’s Fund has long been a matter of concern, attorney Tony Mostert says in his affidavit supporting an application which, if successful, will prevent unclaimed retirement surplus benefits from being put into the fund.
The Guardian’s Fund – actually a number of funds administered by the Masters of the various divisions of the High Court – manages at least R9 billion from many sources – from unclaimed benefits of retirement funds to those of heirs of deceased estates.
And money that remains unclaimed reverts to the state after five years.
Mostert says an investigation he conducted has revealed “that there appears to be very little reliable information or statistics as to the administration and distribution of unclaimed benefits from the Guardian’s Fund.
“The administration and workings of the fund is such that there exists doubt that funds deposited with it ultimately reach the intended beneficiaries.
“As far as I have been able to ascertain, the beneficiary records of the Guardian’s Fund are not updated regularly and no proper age analysis of beneficiary records is maintained.
“The prospect of identifying legitimate beneficiaries and the payments to which they are entitled from the Guardian’s Fund appears to be less than if the unclaimed benefits remained with the relevant pension fund,” Mostert says.
According to the website of the Department of Justice, the purpose of the Guardian’s Fund is “to hold and administer funds that are paid to the Master on behalf of various persons known or unknown, for example, minors, persons incapable of managing their own affairs, unborn heirs, missing or absent persons or persons having an interest in the moneys of a usufructuary, fiduciary or fideicommissary nature”.
The Guardian’s Fund, like the Government Employees Pension Fund, has no trustees, is not subject to the Pension Funds Act, is not overseen by the Financial Services Board, and does not require a licence to act as an administrator.
The assets of the fund are managed by the Public Investment Corporation and are held in interest-earning investments.
Matla Titi, the head of Alexander Forbes Trust & Beneficiary Fund Services, says that, if left to a minor, any benefits in the Guardian’s Fund become state property if they are not claimed within five years of the child reaching the age of majority – that is, they are paid over to the National Treasury.

Considering that the Guardian’s Fund does not trace beneficiaries (they list their names in the Government Gazette), a significant amount of these assets become government property every year, Titi says.

http://www.iol.co.za/business/personal-finance/retirement/bid-to-free-up-unclaimed-pension-benefits-1.1835215

SA’s R15bn heap of unclaimed pensions

ABOUT R15bn in benefits is lying unclaimed in retirement funds overseen by the Financial Services Board (FSB) and at least a third of the money may belong to former mine workers.
Tracing those workers has been particularly problematic, it said last week. The FSB, which oversees more than 5,000 retirement funds, is putting pressure on the trustees of the funds and stepping up joint efforts with the Treasury to find solutions, said the board’s deputy executive officer for retirement funds and friendly societies Rosemary Hunter.
In 2012 there were about 3.3-million unclaimed benefits with an aggregate value of about R15bn in retirement funds.
"We have a huge problem with unclaimed benefits in this country, with pension funds generally. It’s particularly bad in the mining sector," Ms Hunter said.
"As regards putting pressure on the funds, we do get hold of them from time to time and ask them what they’re doing, but we need to work out more intrusive ways of getting involved in that."
The FSB is working on proposals to put to the Treasury and the departments of labour, social development and international relations and co-operation.
"These proposals might include a national database of unclaimed benefits, mechanisms to facilitate the more effective tracing and payment of beneficiaries in SA and other countries," Ms Hunter said.
Personnel firm Teba, which assists mines in recruiting labour and provides services to the sector, puts the size of unclaimed benefits in a number of funds at R5bn. About 200,000 former mine workers or their dependants have to be found to receive these funds, said MD Graham Herbert.
"That number is getting worse. More and more mine workers are owed money. The current system of tracing and paying mine workers is not working," he said.
Trustees from two of the main funds, the Mineworkers Provident Fund, which has 244,704 members according to FSB data, did not respond to requests for comment. The Mines 1970s Unclaimed Benefits Preservation Provident Fund, which has 56,501 members, declined to comment.
Teba, which has a database of 1.3-million mine workers, former workers and their dependants, is anxious to secure a role for itself in tracing and securing payments for the beneficiaries of these funds, Mr Herbert said. Teba, which is more than a century old, used to secure labour from rural SA and neighbouring countries mainly for gold and platinum mines, but there has been a dramatic shift in the labour dynamics on mines.
More than 80% of labour is now drawn from communities around the mines and 20% from distant areas, reducing the need for Teba’s services.
The company is now trying to carve out a new role for itself. In hunting down new revenue sources, Teba is punting itself as the solution to resolving the problems around a large part of the unclaimed pension and provident funds. It has tried to track down some of the beneficiaries as it waits for responses to proposals it has put to trustees of the funds.
"Instead of waiting for the lists, we’ve taken the risk of going onto radio in the first half of the year to ask anyone associated with the mining industry to come to Teba offices or call us if they believe they’re owed money," Mr Herbert said.
It had compiled a list of 120,000 people, and has cross-referenced them with its own database, he said. "Our analysis shows there are 30,000 people who can be instantly found. We know who they are, how much they’re owed by which fund and we can go pay them. We can crack the backlog if we’re given the opportunity and the budget to do it."
The major obstacle appears to be payment. Trustees of the funds are reluctant to pay what’s needed to reimburse the claimants, Mr Herbert says. When Teba traces claimants, it pays the costs of the documentation and verification.
"We don’t find that acceptable. We think the trustees should. They are allowed by law to spend money on tracking and tracing. That’s where this needs to be funded from," he said. "There’s a churlish notion out there that Teba should do this for free. Nobody operates for free."
A senior mining source, who asked not to be named, said one of the mining funds had put out a tender for tracing agents to resolve their backlog and has appointed five companies to do so from early this year. Teba was one of the agencies.
"Teba is not the best tracing agent despite all that data and information they say they have to trace people," said the source. "They have had their costs negotiated down because they were too expensive and not as effective as the others."
Efforts at some of the funds is progressing well, with the 1970s Fund having traced about 10,000 people so far this year and paid out R30m of about R660m outstanding to beneficiaries.

http://www.bdlive.co.za/business/financial/2014/11/03/sas-r15bn-heap-of-unclaimed-pensions