Allied Bank, insurance broker accused of $1m pension scam


Workers at the defunct Allied Bank have accused their employer and a local insurance broker of abusing close to $1 million of their pensions leaving them to wallow in poverty.

The workers, through their representatives led by a W Gutsa, have petitioned the Insurance and Pensions Commission (IPEC) to investigate allegations that Allied Bank diverted $400 000 from the workers’ pension fund for their own use before withdrawing another $400 000 from the pension fund administrator without the knowledge of the workers.

“Our pension statement from the insurance brokers reflects that the employer did not remit pensions for the entire year in 2010,” read the petition lodged with IPEC.

“Further investigations reflect that the employer was nine months in arrears as at April 30, 2010 when the pension fund was granted a paid-up status.”

Allied Bank, owned by the Minister of Macro Economic Planning and Investment Promotion Obert Mpofu, closed its doors early this year due to viability problems after failing to raise the minimum capital requirements set by the Reserve Bank.

Workers also allege management instructed the insurance brokers (name withheld) to reverse pension contributions of $395 000 without the knowledge of the fund members.

“This reversal was a deliberate transaction, which was made by the bank to prejudice the fund and this decision was made without the consent of the members of the pension fund,” read part of the petition

Allied Bank

“In view of the above information, we are of the view that our pension fund was illegally prejudiced of the pension contributions for nine months plus interest over four years and eight months.”

An official at the insurance brokers, Tendai Munyawiri, refused to comment on the issue saying he was not allowed to talk to the Press.
“Who gave you my number? Anyway, I am not allowed to talk to the media,” he said before hanging up.

The workers allege that Allied Bank and the insurance brokers acted in bad faith by exposing the workers, who are now wallowing in poverty, to danger as the money which the brokers allowed to be taken up by the bank was now locked inside the finance house with less prospects of recovery.

The bank is currently under liquidation and the shareholders have already been accused of not transferring equity to the institution to ensure that all liabilities, including pensions and workers’ salaries, are paid off.