The Financial Sector Conduct Authority (“FSCA”) published this Discussion Paper on its website regarding the Framework for Unclaimed Assets in South Africa (“Discussion Paper”). The aim of the Discussion Paper is to build on the work conducted by the National Treasury in respect of unclaimed retirement benefits and to foster debate on how lost accounts and unclaimed assets should be treated in a way that is consistent with treating customers fairly principles.
Some of the FSCA`s thirteen (13) recommendations in this regard include:
A common understanding of dormant and unclaimed assets, with criteria, across the financial sector for the different industry segments under review;
A supervisory approach and reporting framework in respect of dormant and unclaimed assets going forward;
Responsibilities of financial institutions relating to the management, record keeping, and tracing of persons entitled to dormant and unclaimed assets;
Purpose(s) for which such unclaimed assets may be used, where it becomes apparent that the person entitled to unclaimed assets may not ever be traced and where such unclaimed assets remain unclaimed for a determined period of time.
The FSCA furthermore proposes that the following asset types be included within the scope of the proposed Unclaimed Assets Framework:
Retirement fund benefits; Bank deposits, irrespective of the term and including foreign currency deposits; Participatory interests in collective investment schemes; Life and Non-Life Insurance policies; Securities and any investment, return, income, dividend or other proceeds in respect of or derived from the financial products referred to above that are payable or due to customers or their beneficiaries by financial institutions, including assets held by central securities depository participants.