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Tom Muleya Fraud Insight
Pension fraudsters are rewarding themselves on the fruits of other people’s long years of labouring at work or Industry.
A pension in so many ways represents a life’s work but scammers are not hesitant to pounce on their targeted victims and are relentlessly attacking pensioners.
This then calls for the Pension Scheme administrators in the pension sector to come up with robust measures and invest proportionately in controls that will detect and prevent false or stolen documentation tendered to commit pension fraud.
From a global perspective, Crowe’s 2019 Pensions Risk Management Report’ indicated an estimated cost of fraud to the United Kingdom pensions sector to be above £6 billion per year.
From the African perspective, South Africa is said to be losing billions of rand to fraudulent pension schemes. Back home in Zimbabwe, though the statistics on losses due to pension fraud was unavailable at the time of going to print, pension fraud is generally a challenge and is impacting negatively on the economies of pension beneficiaries.
In Zimbabwe pension fraud is a problem and a continuing threat with climbing costs. The following are some of the headlines that were carried in the media; “Massive fraud at pension office: The Zimbabwean 5 August 2015, Bikita Court implicated in pension scam: The Herald 16 January 2017, and Senior citizen arrested for pension fraud, June 2017.
These above few stories and a lot more not indicated all show the extent of fraud in the pension sector in Zimbabwe, and therefore measures should be taken to provide a safety net for both current and future pension beneficiaries.
Some of the chief risks to the pensions sector are identity, internal and cyber fraud. In identity theft, imposters impersonate the real pension holder to claim their benefits.
This involves creating a new and fraudulent national identity card that bears the name and details of beneficiary. Coupled with other fake claim documents, the fraudster claims the terminal benefits for the pensioner without their knowledge.
Identity fraud is also committed against deceased persons where fraudsters arm themselves with fake documents which they use to claim benefits on behalf of the deceased employee’s dependants.
Internal fraud in the pension industry is committed by unscrupulous staff or corrupt insiders in the pension administration offices who manipulate and falsify documents and divert funds from legitimate pensioners to unqualified individuals. T
hey can also wilfully disclose client information to third parties who later uses it to commit pension fraud.
While cyber fraud involves pension fraudsters making use of digital technology to obtain valuable data or information kept or held by pension schemes administrators through hacking of systems to alter records or obtaining personal information of pension holders. Under cybercrime fraud, the criminals also target individuals who store personal data on their computer such as credit details and National Social Security Authority numbers which they steal to commit pension fraud. In view of the above challenges caused by pension fraudsters, if all people take to fight the scourge of pension fraud, our nation will be a better nation.
Get empowered by Fraud Insight and be part of a solution to pension fraud. Stay tuned for other upcoming issue on crime prevention tips.
For your feedback, WhatsApp line: 0772 764 043, or e-mail:[email protected]. Tom Muleya is a Detective Assistant Inspector working under the Criminal Investigations Department. Harare. He is also a member of the National Cyber Security Taskforce, Zimbabwe.
Online Reporter