A few years ago, the Government proposed a plan to utilize unclaimed dividends for first proposed – targeting these dormant funds and have them added to an existing (CMA) investor compensation fund
Shareholders of listed companies duly approved these changes into their company rules, with a bit of debate at more than a few companies annual general meetings (see Diamond Trust 2008 AGM)
Now there are daily ads in the papers urging shareholders to step forward and claim their past dividends before they are transferred, not to the CMA investor compensation fund to a (Government) Unclaimed Financial Assets Authority.
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It gets even more serious with the Barclays Bank of Kenya this wee which also added that the new rule would rope in, not just dividends unclaimed for more than 3 years, but also
– Bankers cheques & foreign drafts not presented for payment for over 2 years.
– Deposits held in bank accounts that have remained dormant for over 5 years.
– Safe deposit boxes that haven’t paid rental fees for more than 2 years.
This is an unfortunate adaptation of a well intentioned plan and It seems there will be no recourse for shareholders who have been incommunicado for what could be a simple reason of changing a post office box address. (Some people also abandon bank accounts, leaving the funds to run out in lieu of formally closing the account and incurring a (frivolous) bank account closure charge).
There are also dormant ‘investor’ funds frozen in bank accounts opened during the the pyramid scheme era that preceded the last election, but the bulk of the idle funds could be due to cases of people who died without wills (and the court are trying to sort out their estates) or other undetermined court cases in which none of the parties can access the bank account funds.
Will the rule also extend to cooperative societies (Co-Op’s), the contents of the safe deposit boxes, land companies, and private companies?
Edit: Via Mark Mwangi, here’s a link to the Unclaimed Financial Assets Bill.
Edit: Via Mark Mwangi, here’s a link to the Unclaimed Financial Assets Bill.