Call for pension scam probe

Cosatu spokesperson Patrick Craven called on Dube Tshidi, the newly appointed executive officer of the board, to "instigate an immediate investigation into this alleged scam."

Tshidi is to take up his new position next month.

Cosatu was concerned and "disgusted" about the scam, reported in the weekly City Press.

The alleged scam, reported in the newspaper on June 8, involves pension fund members who receive loans facilitated by administrators to either renovate or extend their homes.

In order to access the loans members are required to put up their pension fund benefits as collateral in case they default.

According to the paper, with many of the loans pension fund members were charged "interest rates that are unjustifiably exorbitant on what are essentially low-risk loans" , while the administrators who arranged for the loans "pocketed undisclosed profits".

"What is of most of concern is that the very same leading firms in administration of retirement funds who were involved in the bulking scandal are leaders in this alleged scheme to milk millions from retirement funds again," said Craven.

Cosatu called for those involved in the scam not only to be named and shamed but to be prosecuted. The National Prosecuting Authority should prioritise the matter.

"We call on the NPA to prioritise these cases including bulking. For too long white collar crime has been tolerated and treated with kid gloves. Members of retirement funds are saving for themselves, not to be skimmed by the service provider," Craven said.

- Sapa