Felix Mutati snubbed

Wed, 12 Jul 2017 12:46:06 +0000

By NATION REPORTER

Instructions by the Minister of Finance Felix Mutati for Zambia’s largest private pension fund Saturnia Regna Pension Fund not to hold its annual general meeting until an audit is undertaken in glaring financial irregularities may be snubbed.

The annual general meeting is now scheduled for this Friday, 14 July 2017 in spite of the fund failing to obtain audited accounts.

The meetings sole aim it appears is an attempt to remove the current trustees who have questioned a number of irregularities which they want rectified before the AGM.

The meeting may be held even after the regular fund auditors Price Waterhouse Coopers (PWC) have reportedly refused to sign the routine accounts for 2017 until the audit ordered by the Minister is undertaken

The meeting is being bulldozed by the fund management company, Bencon consulting Benefits, in which UPND opposition leader Hichilema Hakainde and his business partner Valentine Chitalu  have controlling interests through other related companies..

The Daily Nation learnt yesterday that PWC were reluctant to sign the accounts because they were still waiting for the outcome of the audit which was ordered by Minister of Finance Felix Mutati last month to look into the governance of the embattled pension fund.

But the Pension and Insurance Authority which has been naccused of being complicit  is reportedly pushing hard for PWC to sign the accounts and reportedly showed PWC the Terms of Reference of the proposed Ministerial Audit to reassure the audit firm that their work will not be at variance with the objective of the ministerial investigation.

However, Lusaka-based Chartered Financial Analyst Aubrey Chibumba has said that he cannot understand the motive for holding the meeting before sorting out substantive issues in the administration of the fund.

“I would rather see the resolution of outstanding issues before rushing to replace the Trustees. I would not rush to replace the Trustees unless I am hiding something,” he said.

Mr. Chibumba said that in his opinion, the Pension and Insurance Authority had failed to regulate and no pension fund is safe in the country.

“The audit may for example find the Trustees negligent and the information held will be relevant. As a service provider, I would rather have all the issues clarified before going into the AGM,” he said.

It is not known whether the ministerial audit will be an ordinary audit or a forensic audit. But Mr. Chibumba said that the PIA must not participate in the audit or be allowed to appoint the auditor.

“I do not know the scope of the terms of reference of the ministerial audit, but I would not ask PIA to participate. The terms of reference must also include an investigation to establish why the PIA has failed to regulate,” he said.

There have been running disputes between the Board of Trustees of the Saturnia Regna Pension Fund and the service providers Benefits Consulting Services Limited and African Life Financial Services Limited which ended up in court litigation which was in both cases won by the Board of Trustees.

He explained that the Trustees have a fiduciary responsibility to the pensioners and the PIA should not allow the service providers to take them to court.

Our sources said that the PIA actions were not in conformity with the Pension and Insurance Authority Act and the Saturnia Regna Pension Fund Trust Deed.

“It is either the PIA registrar does not understand the act or is deliberately overstepping his authority,” they said.