Beneficiaries of unclaimed financial assets stand to lose part of their money once it is handed over to the State body created to handle such funds, commercial banks have warned their customers.
The Kenya Bankers Association (KBA), in a public notice, warned Monday that claimants of abandoned assets will be deducted costs incurred in “sale of the assets, mailing and publication, service charges and costs of examining records of holders of the assets”.
Beneficiaries of unclaimed assets can, however, avoid incurring these charges by lodging claims with their banks before the assets are handed over to the Unclaimed Financial Assets Authority (UFAA), which was created last year but is yet to start operations.
Unclaimed financial assets include bank cash balances, cheques, insurance policies, utility deposits, court awards and credit or safe deposits boxes abandoned for between two to five years.
The Cabinet Secretary to the National Treasury will also have powers to classify other assets under the category.
KBA said bank customers need to regularly update records of their contacts, check accounts regularly and check with brokerage and insurance firms on status of dividends and premiums to avoid having their assets handed over to the UFAA.
“The regulations are a work in progress. Specifics on how the Act is be operationalised will be outlined in those regulations, including clarifications on the criteria, and processes,” said KBA director of communications and public affairs Nuru Mugambi.
Ms Mugambi said KBA would give proposals to the Treasury and the Authority on regulations guiding operations of the new State body.
“KBA has engaged the Treasury and the Unclaimed Financial Assets Authority in this process of consulting on the regulations, especially since banks are a key stakeholder,” said Ms Mugambi.
The advert advises that those with a claim on an asset should file it with the Authority and they will be entitled to receive an evaluation of the claim within 90 days.
For banks accounts, deposits will be considered to be abandoned if they have remained unclaimed for five years. Ownership interest or shareholding in a company will be deemed abandoned if unclaimed for three years.
Most of the other assets will be considered unclaimed if they have been abandoned for at least two years after they were due to be payable or claimed. KBA advised bank customers to give their financial services providers information on their next of kin.
“Banks require their customers to routinely update their records as a matter of good basic financial practice. This up-to-date contact record enables your banks to communicate to you about important matters associated with your bank account,” said KBA.
