Tribunal dismisses retired Sanlam employee’s bid to recover alleged R1 million pension loss
A retired Sanlam employee has failed in his attempt to hold the Sanlam Umbrella Provident Fund liable for losses he claimed were caused by delays in the payment of his retirement benefits, after the Financial Services Tribunal upheld a ruling by the Pension Fund Adjudicator.
The tribunal dismissed an application by A Van Wyk, who sought reconsideration of a determination that found the fund had acted lawfully and in accordance with its rules when processing his retirement payout.
Van Wyk, who worked for Sanlam Life Insurance Limited from February 1989 until his retirement end March 2025, was a member of the Sanlam Umbrella Provident Fund during his employment. Following his retirement, he received a lump-sum payment of R550,000 in April 2025, while the remaining R16.56 million was transferred to Allan Gray Life Limited to purchase a life annuity.
The dispute centred on a 20-day period between the disinvestment of Van Wyk’s retirement funds and the eventual payment of the benefits. Van Wyk argued that his retirement savings had been disinvested on April 9,2025 but were only paid out on April 29, 2025. He claimed that market fluctuations during that period reduced the value of his retirement benefit, causing losses of between R600,000 and R1 million.
Before approaching the tribunal, Van Wyk had lodged an internal complaint with the fund, which was rejected by the fund’s internal arbitrator. He then took the matter to the Pension Funds Adjudicator, arguing that the delay was unreasonable and that the fund should compensate him for the financial loss he allegedly suffered.
The fund did not dispute the timing of the transactions but maintained that a gap between disinvestment and payment was unavoidable under its standard operating procedures and in compliance with its governing rules. It also acknowledged that market movements during such a period could affect the ultimate value of a member’s retirement benefit.
After examining the matter, the adjudicator concluded that the fund had acted in accordance with its rules and that there had been no unreasonable delay in paying the retirement benefits. The complaint was therefore dismissed.
Seeking to overturn that outcome, Van Wyk sought relief from the tribunal, however, the tribunal agreed with the adjudicator’s findings, stating that nothing in the record suggested the fund had deviated from its rules or acted improperly in processing the retirement benefit.
The tribunal noted that although the fund admitted its communication with Van Wyk had not been ideal, it had demonstrated that his retirement benefits were fully accounted for, correctly disinvested and transferred according to his instructions.
In its ruling, the tribunal acknowledged that the timing of the process had ultimately resulted in Van Wyk receiving a lower benefit than he might have obtained under different market conditions. Nevertheless, it found that this did not create legal liability for either the fund or its administrator.
The tribunal concluded that the fund had acted in accordance with both its rules and applicable legislation, and that there was no sustainable basis for overturning the adjudicator’s determination. It therefore dismissed the reconsideration application in its entirety.
IOL News
