Fraud corruption and governance in pension funds the legal framework
This presentation is the property of its rightful owner.
Sponsored Links
1 / 14

Fraud, Corruption and Governance in pension funds: the legal framework PowerPoint PPT Presentation


  • 55 Views
  • Uploaded on
  • Presentation posted in: General

Fraud, Corruption and Governance in pension funds: the legal framework. SK. ABSA BANK LIMITED v SACCAWU NATIONAL PROVIDENT FUND. REMARK - BASHALL AJ “assets of pension funds, not infrequently viewed as a prize by commercial buccaneers, must be safeguarded”. BASHALL AJ : FURTHER COMMENTS.

Download Presentation

Fraud, Corruption and Governance in pension funds: the legal framework

An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -

Presentation Transcript


Fraud corruption and governance in pension funds the legal framework

Fraud, Corruption and Governance in pension funds: the legal framework

SK


Fraud corruption and governance in pension funds the legal framework

ABSA BANK LIMITED v SACCAWU NATIONAL PROVIDENT FUND

REMARK - BASHALL AJ

“assets of pension funds, not infrequently viewed as a prize by commercial buccaneers, must be safeguarded”


Fraud corruption and governance in pension funds the legal framework

BASHALL AJ : FURTHER COMMENTS

  • Pension rules to be interpreted strictly

  • Pensioners vulnerable group

  • Interests of this group must be safeguarded

  • Pension fund assets are trust property

  • They deserve special protection


Fraud corruption and governance in pension funds the legal framework

WHAT HAS GOVT DONE ON ITS PART

  • Passed laws to regulate funds

  • Appointed a regulatory body (FSB)

  • Given regulatory body wide powers

  • All these to reduce fraud and corruption and ensure good governance


Fraud corruption and governance in pension funds the legal framework

WHAT ARE THESE LAWS

  • Pension Funds Act of 1956

  • Financial Institutions Protection of Funds Act of 2001

  • FSB Act of 1990

  • FAIS Act of 2002


Fraud corruption and governance in pension funds the legal framework

WHAT DO THESE LAWS PROVIDE FOR

  • Fund owns assets in own name to exclusion of others

  • Board only managing organ to exclusion of others

  • Funds to have constitution/rules binding on everyone

  • Impose fiduciary and statutory duties on boards, PO’s and administrators and service providers


Fraud corruption and governance in pension funds the legal framework

WHAT DO THESE LAWS PROVIDE FOR

  • PFA makes clear that good governance responsibility of board

  • FSB oversees and can interve where there’s failure by PO, BOARD and service providers

  • Board must therefore have policies in place to ensure good governance (PF 130, KING, UN, OECD principles)

  • Board must also implement policies


Fraud corruption and governance in pension funds the legal framework

REGULATOR’S POWER TO INTERVENE

  • Bad management (actual or likely) calls for FSB intervention

  • Registrar and FSB have wide powers in this regard


Fraud corruption and governance in pension funds the legal framework

WHAT IS FSB EMPOWERED TO DO?

  • Issue directives

  • Remove PO from office

  • Remove board from office

  • Remove administrator

  • Admin penalties


Fraud corruption and governance in pension funds the legal framework

WHAT IS FSB EMPOWERED TO DO?

  • Impose fines or withdraw licences of service providers

  • Call on anyone to cease and desist from continuing with undesirable practices

  • Refer wrongdoers to enforcement committee

  • Apply to court to place institution under curatorship


Fraud corruption and governance in pension funds the legal framework

WHAT IS FSB EMPOWERED TO DO?

  • Can cause an inspection or investigation to be carried out on fund or service provider

  • Take action against wrongdoers based on outcome of investigation

  • Report them even to SARS or NPA or professional bodies for further action to be taken


Fraud corruption and governance in pension funds the legal framework

WITH ALL THESE MEASURES IN PLACE, WHY

ARE WE STILL GETTING IT WRONG?

  • There will always be people who bend or break laws

  • Current measures dont always allow for problem to be detected earlier

  • Usually we find out after the fact

  • Good policies (paper) dont necessarily ensure good governance (good people do)


Fraud corruption and governance in pension funds the legal framework

WHY ARE WE STILL GETTING IT WRONG?

  • Tough sanctions set out in legislation rarely imposed

  • Trustees and service providers often neglect their duties or pass the buck


Fraud corruption and governance in pension funds the legal framework

WHERE TO NEXT? WHAT MORE

CAN BE DONE?


  • Login