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The FSB responds to allegations of wrongdoing

28 January 2016 Jonathan Faurie

The issue involves FSB employee Rosemary Hunter, who is the Deputy Registrar of Pension Funds at the FSB pending the outcome of a disciplinary hearing. She was the “whistle blower” in this case that brought the matter before an independent board at the FSB.

In the City Press report, Hunter alleges that instead of diligently following legal process, the regulator cut corners by handing control to major pension administrators, who closed pension funds en masse. The full City Press article can be read here.

FAnews contacted the FSB to ask for their comment on the matter. Tembisa Marele, Communications Specialist at the FSB, said that the regulator would be opposing the allegations laid before it by Hunter.

Because of this, the matter is sub judice; therefore, the FSB is limited in what they can say regarding the matter at this stage. However, they have released the following statement:

The FSB responds

“Hunter has raised concerns about the process that was followed by the FSB in closing down dormant funds that had no activity or board of trustees to manage them. These funds still required regulatory attention, with no or very limited benefit to members. They were de-registered between 2007 and 2013, following extensive consultation with the retirement industry,” says Marele.

She added that all assets found in the funds were transferred to unclaimed benefit funds where they can still be claimed by their rightful owners. “It is further important to note that the majority of the cancelled funds were underwritten, which means the assets belonged to the insurer, because they operated on the basis of an insurance policy.” 

Hunter believes that the process of closing the dormant funds was flawed, and has raised the question as to whether or not it should be reviewed. Her concerns were brought to the attention of the independent board of the FSB. The board has investigated her concerns, through a process that included a retired judge of the Constitutional Court, Justice O’Regan, and audit firm KPMG.

“The investigation is not yet complete, but a preliminary report from Justice O’Regan is available to all parties concerned, including Hunter, with the proviso that they sign confidentiality agreements, as required by sec 22 of the FSB Act. When Hunter signs this agreement, the report will be made available to her,” says Marele.

She concluded by saying that the FSB board remains committed to the highest standards of corporate governance and has taken all reasonable steps to address any concerns that have been brought to its attention.

Editor’s Thoughts:
This is a typical whistle blower case of David vs Goliath. It will be interesting to see the outcome of this matter. Please comment below, interact with us on Twitter at @fanews_online or email me your thoughts jonathan@fanews.co.za.

Comments

Added by Lucille Horn, 29 Jan 2016
Who will be guarding the guards??
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Added by Eligos, 29 Jan 2016
Not all employees of the FSB are bad. Brokers generally interact (?) with the FAIS Division where a lot is to be desired. But the Insurance Division, Capital Markets, Collective Investments are generally very professional.
This is, however, the second time Mr Dube's name has been linked to something not-so-lekker - asset stripping and a certain Mr Tony Mostert come to mind here.
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Added by Ayanda, 28 Jan 2016
Rotten to the core. And they like to call themselves "a mighty organisation".
Indeed they are "mighty":
Mighty over-staffed: (800 + employees)
Mighty costly: R4,5 bn pa est overall cost to the country.
Mighty inefficient: Try doing something / anything with them.
Mighty incompetent: Few of them have practiced in the industry - have little understanding of how it actually operates or even why it does.
And now it is evident that it is:
Mighty corrupt.


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Added by Cynical Simon, 28 Jan 2016
Very , very unsettling,; Very ,very alarming, and probably just the tip of the Iceberg!! Well done me Hunter; well done!!
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Added by MC, 28 Jan 2016
Old story, They scratch where they should not and don't scratch where they should, that is why we have so many Ponzi schemes in this country
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Added by kenny, 28 Jan 2016
and if there is wrongdoing, let them pay a huge fine... like they give to brokers... and some personal accountability.
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Added by Eric, 28 Jan 2016
I think that beneficiary names should not be published, there is sufficient corruption already.

I agree though that more is required to trace beneficiary's and perhaps ts time all the players fund a 'tracing-team' to do this.

Have it endorsed by the FSB or other regulated body and sponsored by the players.
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Added by Vanessa C, 28 Jan 2016
I do not believe that enough is track down the beneficiaries. The FSB has offered to assist but pensions.queries@fsb.co.za does not seem to exist. Why not publish the beneficiaries of these unclaimed benefits? After all, we are referring to benefits accumulating over decades with pension funds merging and companies no. longer existing.
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Added by MikeR, 28 Jan 2016
As said before..............clowns to the left..........the lunatics are running the asylum.........will last one to leave please switch off the lights............
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Added by Craig A, 28 Jan 2016
Where there's smoke, there's fire!
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