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Firms clung to Sh22.9bn unclaimed shares last year - report

An additional Sh18.4 million was being held in unit trusts.

In Summary

•The Unclaimed Financial Assets Authority had 1,489 safe deposit boxes whose values were unknown.

•Last year, UFAA had indicated nearly half a million companies and institutions were still holding unclaimed such assets.

Kenya's new bank notes
Kenya's new bank notes
Image: ENOS TECHE

Institutions and companies had in their custody  about Sh22.9 billion worth of unclaimed shares in the 2018/19 financial year, denying rightful owners an opportunity to access them.

An audit of the Unclaimed Financial Assets Authority (UFAA) by the Office of the Auditor General has indicated that though the assets were reported by the holders, they were not released to the agency.

An additional Sh18.4 million was being held in unit trusts with 1,489 safe deposit boxes whose value is unknown.

 

The safe boxes held by various institutions mostly contain valuables such as title deeds, company incorporation, share certificates, jewellery and firearms with values running into billions.

At times, they contain illegally stashed local and foreign currency.

During the period under review, the agency was holding Sh13.3 billion in unclaimed assets released by firms.

Some of these includes uncollected salaries, pension dues, matured policies, bank deposits and royalties.

UFAA which is tasked with receiving unclaimed financial assets and re-uniting the assets with their rightful owners, had in September last year indicated nearly half a million companies and institutions were still holding such assets.

“We have more than 447,000 institutions who are still holding on assets that belong to thousands of families who may not know that they have assets they need to claim. They need to know that these assets belong to people out there,” UFAA chif executive John Kihara had said.

The companies were holding in excess of Sh241 billion.

 

Holders only released (transfers) Sh267.6 million in the financial year ended June 30, the authority’s audited financials indicate.

 

Total payables were worth Sh287 million. However, on Sh19.4 million was claimed during the period.

The authority has been keen to audit all financial institutions and state agencies to ascertain the amount of unclaimed assets in their possession.

This is on suspicion that they could be under declaring the exact amount of unclaimed funds they hold.

The unclaimed financial assets Act, 2011 stipulates that failure to remit the unclaimed assets attracts a fine of not less than Sh1 million and/or a one-year jail term for non-compliant CEOs upon conviction.

Non-remittance of cash and annual status reports attracts a penalty of 25 per cent of the unremitted funds while failure to deliver attracts a penalty of one per cent above the prime rate per month per annum.

The Authority receives unclaimed assets and holds them in a Trust Fund. Only when a claim is lodged with verifiable proof showing valid relationship with the rightful owner that the monies are then paid to claimants.

UFAA has in the past raised concern over Kenyans’ disinterest in pursuing funds legally belonging to their families.

The money is largely held by insurance companies, banks, pension schemes, legal firms, mobile phone money wallets and saccos among others.