Pension firm fights back

2009-12-19 14:00

PENSION funds administrator Negotiated Benefit Consultants (NBC), is fighting back against the Financial Services Board (FSB) after the regulator said the black-owned firm would be investigated for alleged irregularities in one of the funds it used to administer.

On Thursday NBC served legal papers on the FSB but refused to comment on the contents of the ­documents.

After receiving the papers the FSB declined to comment, after initially agreeing to an interview.

“The case has been appealed by NBC. We have received legal papers from them and therefore we cannot comment on the matter because it is now sub judice,” said Dube Tshidi, the registrar of pension funds.

The showdown follows the FSB’s decision last week to replace the entire board of trustees of the Private Security Sector Provident Fund (PSSPF) after its on-site investigation uncovered serious governance failures in the management and ­administration of the fund.

The regulator then instructed the fund’s new board, led by pension fund lawyers Jonathan Mort (chairperson) and Francisco Khoza (vice-chairperson), to probe some of the findings from the investigation, particularly the red flags around trustee-related expenses and remuneration as well as alleged irregularities by PSSPF’s administrator, NBC.

Mxolisi Mbekwa, managing ­director of investment consulting firm Selekane, said the FSB would have a hard time pinning PSSPF’s problems on the NBC.

“I think NBC is taking these steps because it feels it has been singled out or treated unfairly. It is a challenge to administer the fund, and some of its problems cannot be blamed on NBC’s incompetence.

“The trustees of the fund should be fighting non-paying employers. NBC’s job is to receive the funds, keep proper records and pay benefits to members,” Mbekwa said.

The PSSPF, which represents 200?000 security guards and has R1.1?billion in its coffers, has been dogged mainly by problems relating to fund contributions since its inception in 2002.

These involved claims that employers deduct pension contributions from members but fail to hand them over to the administrator.

At present the fund is receiving contributions from only 100?000 members, according to receipts from NBC.
 

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