PenCom fines PFAs over failure to enlighten pensioners

Pension fund administrators (PFAs) who fail to enlighten pensioners on programmed withdrawal and other features risk a fine of N500,000. The National Pension Commission (PenCom) said the feature includes retirement life annuity (RLA) as it would enable retirees to make an informed decision on how to manage their pension benefits.

This, the commission revealed under the administrative sanctions, in its Revised Regulation on the Administration of Retirement and Terminal Benefits, saying where a PFA delays payment of retirement benefits for up to five working days after receipt of no-objection from the commission, it would pay an administrative sanction of N200,000 and 20,000 daily delay penalty thereafter.

The commission noted that PFA and/or pension fund custodian (PFC) that pay retirement benefits without the commission’s prior no-objection shall pay an administrative sanction of N1,000,000 in addition to refunding either the principal amount paid or lost investment income, whichever is higher.

It said a PFA that pays an amount over that specified on the no-objection approval granted by the Commission would be liable to refund the amount overpaid and investment income lost arising from the transaction, except where the difference is a residual amount or as a result of return on investment.

Any PFA that pays an amount lower than that specified on the no-objection approval granted by the Commission, would, in addition to paying the differential to the retiree, pay an administrative sanction of N500,000, it said.

PenCom submitted that any PFA that negligently submits to the Commission, a request with incorrect information that is likely to result in accelerated depletion of the RSA balance of a retiree, would pay an administrative sanction of N500,000.

The regulator said where a PFA delays the submission of a request for the payment of benefits by a retiree/beneficiary to the Commission for approval for more than 10 working days from the date of submission of relevant documents, it would pay an administrative sanction of N200,000 and N20,000 for every further day of delay thereafter.

It stated that any violation of any provision of this regulation for which no sanction has been prescribed would attract an administrative sanction of not more than N2,000,000.

“All sanctions in this regulation shall be charged to the operator’s profit and loss account and the burden shall not be transferred to the employees of the operators,” it stated.