After a wait of about 16 years, some 15 500 pensioners and members of seven retirement funds that had their surpluses stripped by employers in the early 1990s will soon be paid out a total of R730 million.
Payments totalling R118 million to the current members and pensioners of another fund affected by surplus-stripping, the Mitchell Cotts Pension Fund, are virtually complete.
In a media release this week, Dube Tshidi, chief executive of the Financial Services Board (FSB) and Registrar of Pension Funds, says surplus apportionment schemes have been approved for the following funds: Lucus SA Pension Fund (in liquidation), Prestolite Pension Fund (in liquidation), Picbel Groep-voorsorgfonds (in liquidation), Sable Industries Pension Fund (under curatorship), Datakor Group Pension Fund, Datakor Group Retirement Fund (under curatorship) and Cortech Pension Fund (under curatorship).
Tshidi says some significant milestones have been reached in the ongoing saga of those retirement funds that had their surplus assets misappropriated in the 1990s through the so-called “Ghavalas option” (named after Peter Ghavalas, the architect of the surplus-stripping scheme and now a convicted fraudster).
These milestones include the review and setting aside by the South Gauteng High Court on June 20 of the certificates issued under section 14 of the Pension Funds Act relating to the Datakor Group Pension Fund, Datakor Group Retirement Fund and Cortech Pension Fund.
(Section 14 certificates, which are issued by the FSB in terms of the Pension Funds Act, are required to ensure that fund members are protected when they and their savings are transferred from one retirement fund to another.)
In August 2009, the registrar and the FSB applied to the High Court to have the contentious certificates set aside after Ghavalas pleaded guilty in February 2009 to various charges, including committing fraud against the registrar’s office.
* In September last year, the High Court accepted that, in at least three of the seven cases, employers, assisted by other parties, stripped retirement fund surpluses by fraudulently deceiving the FSB.
The FSB had applied to the High Court to set aside the approvals it gave for fund transfers that allowed a number of employers to strip surpluses from retirement funds.
The High Court postponed hearing opposition to the applications by Johannesburg businessman Simon Nash and Aubrey Wynne-Jones, chief executive of Wynne-Jones & Company Employee Consultants, both of whom face criminal charges for their role in the surplus-stripping schemes.