• Doubts remain over outstanding payments
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  • New Bill to plug anomalies
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Livingstone Marufu
FORMER AfrAsia workers have been paid US$2 million of the US$6 million that is owed to them in pension packages seven months after the financial institution closed shop, but there are doubts on whether the full sum that was invested by the pension fund trustees can be fully

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recovered, it has been learnt.

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AfrAsia Bank Zimbabwe, formed after the acquisition of Kingdom Bank Africa Limited, had its licence cancelled by the Reserve Bank of Zimbabwe (RBZ) on February 24, 2015 as it was deemed financially unsound.

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After the bank’s closure, the Pension Fund Trustees of AfrAsia Holdings were appointed liquidators to wind up the fund in order to avoid the associated costs that come with an external liquidator.

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Former group chief executive officer Mrs Lynn Mukonoweshuro was appointed the principal officer/chairperson.
\nOther members were Mr Noel Mukutirwa, Mr Savious Mushosho, Mr Patrick Chitehwe and Mr Kenneth Kaseke and Mr Dale Mafunda.
\nMinerva Consulting was appointed the professional fund administrators.

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However, endless delays in paying out proceeds from the pension fund made most of the ex-workers restive.
\nThe Insurance and Pensions Commission (IPEC) prudential supervision manager, Mr Munyaradzi Machinjika, told The Sunday Mail Business recently that although the Commission was not obliged to monitor the liquidation of the bank, its brief was to supervise Minerva, which falls under its purview.

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“The engagement process has progressed well, except that members have received a fraction of what they are duly owed by the fund.
\n“As of August 20 2015, Minerva confirmed that the members had received their one-third commutation payments, although at a discount, given some doubts as to the recoverability of some assets in which the fund had invested. . .

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“The liquidation process is not under our control; we continue to monitor the situation via updates from Minerva, who are our regulated player as the administrator of AfrAsia Pension Fund, to make sure all the pension fund is paid.

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“The sponsoring employer, AfrAsia bank, directed Minerva to liquidate investments elsewhere and pay the proceeds into AfrAsia’s bank account despite clear signs that the bank had liquidity challenges which compromised accessibility of benefits by members. It is our understanding that Minerva tried without success to advise the fund to find an alternative banker,” said Mr Machinjika.

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IPEC, which noted that part of the delays in paying out funds owed to ex-AfrAsia workers was mainly caused by lack of expertise and failure to conform to the Pensions and Provident Funds Act on the part of board of trustees and liquidators, believes that the Pension and Provident Fund Bill will be able to strengthen its supervisory role and plug loopholes that exist in the current system.

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“We have tried to tighten the rule book by way of the Pension and Provident Fund Bill, which we believe will go a long way in arming IPEC with legal teeth, including corporate governance requirements and guidelines. . .

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“The process (to pay off ex-workers) has taken this long as a result of shortage of competent expertise in the running of pensions; the Board of trustees and the professional fund administrators, Minerva Consulting.

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“Their main roles include drafting rules of the pension funds to comply with the Pension and Provident Funds Act, administration, minute taking, chasing up late pension contribution payments and benefit payments,” explained Mr Machinjika.

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Through engagements among the Commission, Minerva and the liquidator, the claims of the pensioners have since been registered with the principal liquidator – the Deposit Protection Commission (DPC) – to ensure that they benefit from the liquidation process.

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Government has come up with a commission of enquiry to investigate the value of pension and insurance assets lost during the changeover from the Zimbabwe-dollar era to the multicurrency system.