NEWSMAKER
Pension abuse in Financial Sector Conduct Authority’s crosshairs
Regulator says rot in the industry robs pensioners of dignity
Armed with a new mandate to be more "proactive, pre-emptive and intrusive", the Financial Sector Conduct Authority (FSCA) is going to clamp down on corruption in the pension fund industry that is denying employees a dignified retirement, says Naheem Essop, a specialist analyst in the regulator's retirement funds supervision division. Most service providers, including legal advisers, administrators and investment advisers, are overcharging retirement funds and bribing trustees, he told the annual conference of the Pension Lawyers Association of SA this week. The practice is "prevalent", he says. He cites the example of an attorney who charged R72,000 to prepare a "perfectly standard" two-page document. "If you took off the attorney's letterhead it would be a one-page document." The Financial Services Board was criticised for regulatory failures but the FSCA, which replaced it as part of the new "twin peaks" model of financial regulation, is "something very different", Essop says. "Ou...
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