A pension fund has been left red-faced after two serious failures undermined confidence in its governance of a deceased member’s death benefit, with the Pension Funds Adjudicator finding that it had failed to properly investigate a claim by an alleged cohabiting partner.
The Becsa Provident Fund initially paid incorrect amounts to beneficiaries and only corrected a shortfall of more than R325 000 after the family repeatedly challenged the payments and engaged directly with the South African Revenue Service (Sars).
More seriously, the fund allocated part of the death benefit to a woman it accepted as the deceased’s cohabiting partner. She later admitted that she had never met the deceased and had been persuaded by a friend to submit a false claim in the hope of making quick money.
The case has highlighted the risks of relying on affidavits without taking reasonable steps to verify the information contained in them.
The complaint was lodged with Adjudicator Lebogang Mogashoa by the deceased’s mother after her son died on 29 August 2022.
The full story
A death benefit of R2 069 241.89 became available for distribution after a tax deduction of R709 121.03 and the inclusion of R121 082.26 in interest.
On 18 April 2024, the fund’s board resolved to allocate 30% of the benefit to each of the deceased’s parents and his sister, with the remaining 10% going to the alleged cohabiting partner.
However, when payments were made in November 2023, each of the three family members received only R512 399.19.
The family disputed the amounts, arguing that R1 948 159.63 remained available for distribution after Sars deductions. This would have amounted to R649 386.54 for each of the three family beneficiaries.
Only after persistent questioning and direct engagement with Sars did the fund pay a further R325 180.14, amounting to R108 393.38 for each family member.
The family nevertheless maintained that a further R85 841.28 remained outstanding.
The fund also maintained that 10% of the benefit had been allocated to an alleged cohabiting partner, whose identity had not initially been disclosed to the family.
The deceased’s mother rejected the claim that her son had been living with the woman. She said the allegations were untrue and offered to provide witnesses, including people who had lived with the deceased and his close friends, who could refute the claim.
What the fund said
The fund countered that the alleged cohabiting partner had deposed to an affidavit stating that she had been in a relationship with the deceased, lived with him and was financially dependent on him because she was unemployed.
The fund also said it had received an affidavit from the deceased’s landlord and friend, who corroborated the alleged partner’s account.
It further argued that the complainant lived in the North West Province, while the deceased was living in Middelburg when he died. On that basis, the fund said she would not have had direct knowledge of his living arrangements and that her assertion that he did not have a cohabiting partner could not simply be accepted as fact.
Faced with conflicting accounts, the Adjudicator joined the alleged cohabiting partner to the proceedings and sent her legal correspondence seeking her response to the allegations.
Her response dramatically changed the course of the matter.
The woman admitted that she had never met the deceased and had never been in a relationship with him.
She told the Adjudicator that a friend had approached her and said there was a sickly man in hospital and that she could help her obtain fast cash in connection with him.
According to her account, the friend asked her to depose to an affidavit stating that she was the deceased’s girlfriend, provide a copy of her identity document and the benefit statement, and leave the rest to the friend.
She complied.
The woman said she subsequently became concerned that she could be implicated in fraud. She confirmed that she had not received any of the benefit proceeds.
The alleged cohabiting partner’s response was sent to the fund for comment. On 18 November 2025, the fund said it would escalate the matter to its internal audit department because the case now involved allegations of fraud and criminality.
In his determination, Mogashoa stressed the social purpose behind section 37C of the Pension Funds Act, which governs the distribution of death benefits.
Protecting people
The provision is intended to protect people who were financially dependent on a deceased fund member during their lifetime.
“The fund accepted the alleged cohabiting partner as a dependent by merely relying on affidavits without taking adequate steps to verify the information therein. This matter is a classic example of the dangers of blindly relying on affidavit without employing any other reasonable methods to verify and authenticate the allegations therein.
“The Adjudicator is satisfied that the board failed to properly investigate the matter. Thus, the fund must be held accountable for its failure to ensure that the deceased’s benefit is paid to the correct beneficiaries,” the Adjudicator said.
Mogashoa ordered that the board’s decision on the distribution of the deceased’s death benefit be set aside.
The fund was ordered to conduct a fresh investigation, identify the deceased’s beneficiaries while taking the findings of the determination into account, and thereafter allocate and distribute the death benefit accordingly.
The determination places the responsibility squarely on the fund to ensure that claims made by prospective beneficiaries are properly investigated before a death benefit is distributed, particularly where competing claims and allegations of dependency are involved.
dieketseng.maleke@nationalmg.co.za.