And for shortchanging the deceased's family.
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The Pension Funds Adjudicator has taken the Becsa Provident Fund to task for what it described as serious failures in governance following errors in payments and the wrongful allocation of death benefits.
The fund allegedly paid beneficiaries incorrect amounts, only correcting a shortfall of more than R325 000 after the beneficiaries themselves flagged the mistake.
The adjudicator said that, in an even more troubling lapse, the fund also allocated a portion of the death benefit to a woman who was presented as the deceased’s cohabiting partner. But the claim that she was his partner was later found to be untrue.
The complaint was brought before the adjudicator, Lebogang Mogashoa, by the deceased’s mother after her son passed away on 29 August 2022.
A death benefit of more than R2 million became available for distribution to the beneficiaries after a tax deduction of over R709 000 and the addition of over R121 000 in interest.
Allocation of funds
In 2024, the board resolved to split the benefit between the deceased’s parents and sister (30% each), with the remaining 10% going to the alleged partner.
But when payments were made in November 2023, each family member received less than was due to them.
“Only after persistent questioning and direct engagement with Sars [South African Revenue Service] did the fund pay an additional R325 180.14 (R108 393.38 each),” Mogashoa said in a statement on Wednesday. “Even then, the family maintained that R85 841.28 remained outstanding.”
The fund claimed part of the benefit had been allocated to the alleged cohabiting partner of the deceased, whose identity it had not disclosed to the family.
Affidavits
While the deceased’s mother disputed the claim, the fund said it was in possession of an affidavit from the alleged cohabiting partner stating that she was in a relationship with the deceased, lived with him, and was financially dependent on him because she was unemployed.
The fund also claimed to have an additional affidavit from the deceased’s landlord and friend, who corroborated the woman’s account.
Following an investigation by the adjudicator, the woman recanted her claim that she had been the deceased’s cohabiting partner.
She admitted that she had been persuaded by a friend to lodge the false claim in exchange for quick money.
In 2025, the matter was referred for an internal audit to investigate potential fraud and criminality.
Adjudicator’s ruling
“The fund accepted the alleged cohabiting partner as a dependent by merely relying on affidavits without taking adequate steps to verify the information therein,” the adjudicator said.
“This matter is a classic example of the dangers of blindly relying on affidavit[s] without employing any other reasonable methods to verify and authenticate the allegations therein. The adjudicator is satisfied that the board failed to properly investigate the matter.
“Thus, the fund must be held accountable for its failure to ensure that the deceased’s benefit is paid to the correct beneficiaries,” it added.
Having set aside the board’s decision on the distribution of the deceased’s death benefit, the fund was ordered to conduct an investigation to identify the deceased’s beneficiaries and correctly allocate and distribute the benefit.
This article was republished from Moneyweb. Read the original here.
