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Unclaimed Benefits

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Administration fees are deducted from unclaimed benefits – are these eroding members' benefits?

After the reinstatement of a fund, is Liberty solely responsible for the fund?

Has liberty unduly benefited from the incorrect deregistration of funds and from member assets in dormant funds?

how are the assets of unclaimed benefits funds invested? are members' assets growing while held in these funds?

What action has liberty taken against its employees who were instrumental in the erroneous deregistration of funds?

What action has liberty taken to ensure that members belonging to de-registered retirement funds with assets and dormant funds are not prejudiced?

What is liberty doing to trace members with lower benefit balances who are exempt from administration fees?

What progress has been made to reinstate the erroneously deregistered funds?

What steps has liberty taken to ensure that monies belonging to members in historic funds are paid to members and beneficiaries

Where were the assets of the dormant funds invested and did liberty intentionally deregister funds with assets for financial gain?

Who serves on the current board of trustees of the Liberty unclaimed benefits funds?

Why did Liberty have so many dormant retirement funds under administration?

• In the 1990s and early 2000s, Liberty was a significant provider of retirement fund solutions to the small-to-medium-enterprises (SME) market. At that time umbrella funds were not that popular so the majority of SME employers registered their own standalone funds. Over time, the increasing costs and complexity of standalone funds and growing popularity of umbrella funds encouraged many SME employers to transfer their employees into umbrella funds. In many cases, the transfers left the standalone funds orphaned (without boards of management) and dormant (for instance, they no longer received ongoing contributions) and requiring winding down and deregistration.

• The SME market was characterised by a relatively high turnover rate as businesses were bought by competitors or ran into financial difficulties and stopped operating. In most cases their standalone funds remained in existence, orphaned and dormant. The employees may have been absorbed into the new employer’s operations or retrenched, leaving the standalone funds without boards of management to attend to their winding down and the payment of benefits to members. Had the boards of management of these dormant funds managed to transfer the assets to other retirement funds, or paid them to the members, the dormant funds would have been wound down and deregistered.

• Liberty acquired a number of retirement fund administration businesses in the early 2000s, with the intention of growing its business. This included the Investec Employee Benefits business in 2003. It was a condition of this acquisition that Liberty take over the Investec Employee Benefits book of dormant funds. The majority of those dormant retirement funds were made up of Fedsure and Norwich clients that Investec had acquired a few years before. • Liberty acquired Capital Alliance in 2005. Our understanding is that Liberty was intent on acquiring the substantial retail business component of Capital Alliance. The smaller corporate component of Capital Alliance was acquired as a consequence of this transaction. This included several retirement funds that were already dormant at the time.

Why do the historic records of the acquired businesses create administration complexity?

Why were unclaimed benefits from occupational funds transferred to the liberty unclaimed benefits funds?

Will assets belonging to dormant and reinstated funds be subject to an external audit?

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Liberty Group Limited (Reg. no 1957/002788/06) is a registered Long Term Insurer and an Authorised Financial Services Provider (FAIS no 2409).