Assets in the custody of the Unclaimed Financial Assets Authority (UFAA) surpassed KSh17 billion on October 29, a day to the October 30 deadline. Corporations and State agencies remitted Ksh 1 billion in unclaimed assets in the three months to October, avoiding sanctions for non-compliance.
A report by Business Daily shows that UFAA has completed audit review for 80 companies, and issued notices of sanction to non-compliant firms. According to The Unclaimed Financial Assets Act of 2011, firms who fail to comply with the 14 days notice will pay penalties of up to 25% of the assets held, in addition to surrendering the financial assets. Companies might also pay a penalty of between 7,000 and 50,0000 daily for assets not submitted.
“A person who willfully fails to pay or deliver assets to the Authority as required under this Act shall be liable to pay a penalty equal to twenty-five percent of the value of the assets that should have been paid or delivered.”
“A person who willfully fails to pay or deliver assets to the Authority as required under this Act shall be liable to pay a penalty equal to twenty-five percent of the value of the assets that should have been paid or delivered.”
Further, CEOs of non-compliant firms convicted of willfully refusing to deliver assets to the authority risk a fine of between Ksh 50,000 and 1 million and or a year in prison.
“The notices expire in 14 days after which offending firms will be expected to comply forthwith by surrendering the monies with accompanying reports as well as pay the penalties. For companies facing cashflow challenges, we have an obligation to listen and come up with an agreeable repayment plan,” says UFAA CEO John Mwangi.
Firms in Line for the UFAA Penalty Axe
Kenya Power is among the companies that risk penalties to the tune of Ksh 1.8 billion for not surrendering assets worth Ksh 922 million. The assets are in the form of cash refunds to consumers for power meters, unidentified receipt, unpaid customer electricity deposits, and outstanding way leaves compensation as well as unpaid dividends.
East African Portland Cement EAPCC also risks penalties, owing to its Ksh 102 million in unremitted dividends to the UFAA. EAPCC also has Ksh 91 million in unremitted pensions and 1.7 billion in unpaid salaries.
Last year, almost half a million companies held unclaimed assets worth over Ksh 241 billion. Only Ksh 267.6 million was transferred to the UFAA by June 30, bringing payables to Ksh 287 million and claims to Ksh 19.4 million.
