Barack Hussein Obama, the father of America’s president, had a life insurance cover that was never paid to the rightful beneficiaries upon his death, resulting to transfer of the funds to the Unclaimed Financial Assets Authority (UFAA).
The agency, which was established in 2013, is holding Sh55,933 that was due to the family of the then senior economic analyst at the Treasury following his death in a car accident in 1982.
If adjusted for inflation, the amount would be equivalent to Sh2 million today but that has not happened because insurers do not make such adjustments nor pay interest on policy funds.
The UFAA, which holds unclaimed assets in trust for the rightful owners, has records showing that the Obama funds came to its custody last year from the defunct Kenya National Assurance Corporation (KNAC).
“I can confirm we are holding the amounts for Obama Senior — part of our responsibility is to reunify the assets with the rightful owners after authentication,” said UFAA’s chairman Vincent Kimosop.
Mr Obama had nominated his eldest son Roy Obama, also called Malik, and his youngest wife Jael Otieno as beneficiaries. Obama senior had four wives, two of whom he married while in the United States, and eight children.
Among the children is the American President Barack Obama, from his marriage with Ann Dunham, whom he met while studying at the University of Hawaii in the US.
News of the Obamas’ unclaimed assets comes as the US President prepares to visit his father’s country for an entrepreneurial meeting in two weeks’ time.
The UFAA was formed in 2013 to hold in trust cash held by companies for a defined period without any activity from the owner and has been taking over unclaimed assets since last year.
The list of assets classified as unclaimed includes bank accounts that have been dormant for more than five years, bankers cheques not cashed for two years and contents in safe deposit boxes unclaimed for more than two years.
Matured life insurance policies unclaimed for more than two years and shares whose dividends have not been collected for more than three years also qualify to be handed over to the agency.
The KNAC became the first company to submit money to the authority. The defunct government-owned corporation, which was put under receivership in 1996, handed over Sh348 million to the authority, becoming the first service provider to surrender such a large amount of money to the agency.
At the time of collapse it had claims estimated at Sh4.3 billion but it was able to trace and settle 90 per cent of the total.
It is not clear why the corporation was not able to pay Mr Obama’s beneficiaries given their prominence.
It is the responsibility of the holding company to search for the rightful owners of an asset before declaring it as unclaimed and forwarding it to the agency.
Most of the unclaimed assets are attributed to failure by the deceased to inform the beneficiaries of the asset and the absence of a will stating the same.
Mr Obama died at the age of 46 at a time when he is said to have been struggling with poverty having lost both his legs in two previous car accidents.
Following Mr Obama’s death, a fierce legal battle ensued over his estate, then estimated to have been worth Sh410,500. The battle was mainly between his first wife, Kezia Obama, who is said to have been separated and divorced from her husband at the time, and the youngest wife Jael.
Ms Kezia is the mother to Roy, who was nominated as a beneficiary to the life insurance policy.
Mr Obama’s life was said to have been a mystery to many with the American President writing of him: “His life was so scattered. People only knew scraps and pieces, even his own children," in his book Dreams from My Father.
Sarah Jacobs, author of the book The Other Barack, notes that President Obama disavowed any claim he might have had to his father’s estate in a letter to a Kenyan court in 1997.
The amount forwarded to the agency was the principal amount that Mr Obama contributed to the policy. Unclaimed cash does not accrue any interest.
Mr Kimosop said the authority is holding more than Sh3 billion barely 10 months since it became operational. It is, however, estimated that Kenya has in excess of Sh20 billion worth of unclaimed assets.
Owners of assets or their dependants can search for any amounts held by the authority by interrogating the agency’s website using their names.
Rita Auma Obama, sister to the American president, is also listed among those whose assets are considered idle and have been forwarded to the agency. Ms Obama’s details were forwarded by KCB.
Another prominent person whose assets have been forwarded is Interior secretary Joseph Nkaissery whose assets were held by National Bank of Kenya.
Assets forwarded to the authority are to be invested in infrastructure projects, giving the government a cheap source of cash. The cash is currently invested in Treasury bills and bonds as the authority sets up an administrative office.
Unclaimed assets have been a huge source of fraud in Kenya where fraudsters, in collaboration with bank employees, have targeted dormant accounts in the hope that no one will ever put a claim on the cash.
Kellen Kariuki was appointed chief executive of the unclaimed assets agency in January this year and the agency advertised senior positions in May.
As at December last year, Standard Chartered had surrendered the highest amount of Sh537 million to the authority, including Sh362 million cash held in deposits. Some Sh1.4 million accrued from salary arrears while Sh132 million arose from unclaimed dividends.
Telecommunications giant Safaricom handed over Sh500 million in February this year relating to M-Pesa deposits. EABL had forwarded Sh306 million attributable to unclaimed share dividends.