Holders of unclaimed assets ordered to surrender report

By Fredrick Obura 

NAIROBI, KENYA: Holders of unclaimed assets have until Sunday to submit reports to the Unclaimed Financial Assets Authority (UFAA).

In a notice appearing in local dailies, the authority wants the amounts in the report to tally with funds credited at unclaimed assets trust fund accounts.

Section 33 of the Unclaimed Financial Assets Act provides for penalties for failure to remit unclaimed funds and reports to the authority. There is however no deadline for claims on unclaimed financial assets held by the authority.

The Authority commenced receiving unclaimed financial assets from holders six years ago and reuniting the unclaimed financial assets process with beneficiaries in 2016.

“Although there has been the improvement of the reunification rate of assets with the beneficiaries over the last three years, the rate is significantly slow standing at 1.5 per cent of receipts as of June last year,” notes Auditor General Office in a report for the year ended June 30, 2019.

The management attributed the slow pace to the Unclaimed Financial Assets (UFA) Regulations, 2016 which do not support the reunifications.

“In the circumstances, the Authority is not meeting its mandate of tracing unclaimed assets from holders and reunifying the assets with the beneficiaries.”

According to the latest financial report from the Unclaimed Financial Assets Authority (UFAA), the total value of unclaimed assets held by the State stands at Sh13.3 billion as at the end of September 2020, up from Sh10 billion recorded in 2018.

“During the year under review, the Authority scaled efforts to ensure compliance by the holders of unclaimed financial assets through issuance of Surrender notices to all holders, began inspection of holder’s books on reporting and instituting the necessary structures, systems and procedures to guide the process,” said UFAA Chief Executive John Mwangi in a statement accompanying the results. 

“These efforts yielded a growth of the fund to the current value of Sh13.3 billion in cash, 539.77 million share units from various counters and 1,489 safe deposit boxes reported to the fund,” said Mwangi.

The Authority spent Sh635 million from the Sh722 million budget for the 2018/2019 financial year. This included Sh157 million carried forward from the previous year, Sh207 million in direct disbursement from the exchequer and Sh354 million drawn from the Authority’s trust fund with the approval of the National Treasury. 

In addition to this, the agency reported Sh1.1 billion in investment income, up from Sh971 million the previous year with the money recorded as surplus that was carried forward for budgetary commitments in the 2019/2020 financial year.     

According to the UFAA financial results, Sh22.9 billion worth of shares and Sh18.4 million in unit trusts have not been surrendered to the Authority, even as the fund managers have made the statutory reporting.