Between July and September 2022, benefits totaling N13.36 billion were paid to the family of 2,304 dead contributors under the Contributory Pension Scheme.
In the third-quarter quarterly report for 2022 that our correspondent was able to get from the National Pension Commission, this information was provided.
According to the report, 582 late employees in the commercial sector and 1,722 late employees in the public sector each received payments for their relatives.
The regulator of pensions said, “During the quarter under review, approvals were granted for payment of death benefits amounting to N13.36bn to the legal beneficiaries/administrator of 2,304 deceased employees and retirees. This comprised of 1,722 public (FGN & State) and 582 private sector employees/retirees.”
In its recently amended rules on the processing of benefits under the CPS, PenCom revised the regulation governing the administration of retirement and terminal benefits.
According to the regulation, the legal beneficiary(ies) of the decedent must provide the Pension Fund Administrators with the necessary paperwork, including a completed death notification form, in order to process death benefits.
It was also stated that a letter of administration and a signature verification letter issued by the banker to the legal beneficiary(ies) or estate of the deceased were required, as well as proof of death, which could be any number of documents or a certificate of death issued by PenCom (in cases where the death occurs at home).
The supporting documents needed are a burial warrant issued by a local government council, proof of death/burial issued by an Islamic community, the head of a Sharia court, or a judge, proof of death issued by a leader of a registered church, copy of an obituary poster (if any), a hospital-issued certificate of cause of death (if the death occurs in a hospital), or a police report (if the death does not result from a natural cause; a letter.
The PenCom also promised to take harsh measures against family, employees, and retirees who fraudulently claim the deaths of Contributory Pension Scheme contributors in order to receive payments due to the deceased.
In addition to other methods of verification, PenCom requested that the banks close the accounts of deceased contributors in order to prevent them from ever being able to operate bank accounts in the nation again.
The regulator for the pension business implemented these requirements as a result of the rising instances of fake deaths being planned in order to withdraw the money in the Retirement Savings Accounts of reported dead employees.
In a previous circular, PenCom stated: “The commission has received a series of complaints from retirees, who alleged that their PFAs have wrongfully paid their benefits to their next of kin or legal beneficiaries, while they were still alive and in active service without their consent.
“Following these complaints and reports by the PFAs, it has become imperative to issue additional measures to curb these complaints and strengthen the processes and practices of processing and payment of death benefits.”
In order to verify and confirm the death of employees, PenCom directed the PFAs to get in touch with the deceased employee’s employer.
The PFAs were instructed by the pension regulator to exercise due diligence and examine the probate registry of the issuing authority to confirm the authenticity of the documents and to confirm the details of the appointed administrator and sureties.
