20 firms fined Sh2.2 billion for failing to remit unclaimed financial assets
15 of the 20 companies faced fines amounting to at least half of the assets they failed to remit. CIC Insurance bore the largest penalty of Sh999.6 million for not remitting Sh1.4 billion.
20 companies, including CIC Insurance, Equity Bank, and several universities, have been penalised a total of Sh2.2 billion for failing to hand over unclaimed financial assets to the Unclaimed Financial Assets Authority (UFAA).
The fines follow a detailed audit by the Auditor-General, which revealed that these firms withheld dividends, insurance payments, dormant savings, and other idle funds that by law should have been transferred to the State agency to help reconnect the money with its rightful owners.
More To Read
- MPs push Treasury to curb rising fees on unused foreign loans
- Majority of Kenya’s unclaimed assets under Sh1,000 - Auditor General
- Auditor faults UDA for lacking proof of Sh2 billion land assets
- Billions locked in stalled county projects across the country - CoB Margaret Nyakang'o
- MPs grill SHA over Sh91m legal costs, disputed Karen land and stalled NHIF projects
- Auditor General flags CBK for hiring unqualified managers, ignoring HR Policies
The Auditor-General’s findings show that 15 of the 20 companies faced fines amounting to at least half of the assets they failed to remit. CIC Insurance bore the largest penalty of Sh999.6 million for not remitting Sh1.4 billion.
Other notable fines include Equity Bank at Sh249.7 million and Moi University at Sh211.3 million.
Unclaimed assets surrendered to UFAA have now exceeded Sh75 billion, demonstrating the challenges in locating owners for dormant funds, as many individuals, including high-profile businesspeople and politicians, show little interest in claiming their wealth.
Idle assets include bank balances inactive for more than five years, uncashed bankers’ cheques, unclaimed insurance payouts, money left in mobile wallets, and contents in safe deposit boxes untouched for over two years.
By law, all holders of such assets must report and transfer them to UFAA by November 1 annually, even if no unclaimed funds exist, by filing a nil return.
The law imposes a 25 per cent penalty on the value of unremitted assets, along with daily fines between Sh7,000 and Sh50,000 for each day the funds remain untransferred.
Companies are also required to actively seek the rightful owners before declaring the assets unclaimed.
The report notes that the heavy penalties have triggered disputes with some firms, causing delays in the remittance of funds.
“The audit established that failure to close compliance audits was due to imposition of heavy penalties on holders for the assets identified during compliance audits, thereby discouraging holders from remitting assets to the Authority,” stated the Auditor-General.
Of the 20 audited entities, the total unclaimed assets amounted to Sh5.1 billion. UFAA conducted audits on 134 companies in five phases with the help of three compliance auditors, identifying unremitted funds worth Sh12.2 billion.
The auditors charged UFAA Sh416.3 million, while the agency billed the firms Sh318.8 million, though only Sh94.5 million had been collected by August last year.
Some fines were far higher than the value of the assets withheld. Carbacid Investment, for example, was penalised Sh30.8 million for failing to remit Sh1 million.
Moi University Retirement Benefits Scheme received a fine of Sh111.6 million for withholding Sh29.7 million, representing a 375 per cent penalty.
The University of Nairobi held the largest volume of unclaimed assets at Sh2.3 billion but was fined Sh66.8 million. The specific unremitted assets were not disclosed in the Auditor-General’s report.
Public universities also held significant amounts of idle funds, with Maseno University holding Sh40.6 million in unclaimed assets, attracting a Sh74.5 million fine.
Pioneer Assurance and Pacis Insurance faced penalties of Sh131 million and Sh10.1 million for withholding Sh246.5 million and Sh6.2 million, respectively.
UFAA reports that many Kenyans remain indifferent to claiming funds legally belonging to them or their families, while surrendered shares and cash have steadily grown, highlighting the persistent accumulation of unclaimed wealth.
As of last year, UFAA had received Sh36.09 billion in cash, up from Sh23.2 billion in 2021. The number of surrendered safe deposit boxes, often containing jewellery, title deeds, share certificates, and Treasury bills, rose to 3,737 from 1,953.
Over 9.87 million unit trusts were also part of the idle assets, which are primarily held by banks, insurance firms, pension schemes, legal practices, mobile money platforms, and Saccos.
Top Stories Today
