, NAIROBI, Kenya, Aug 31 – The High Court has quashed a decision by Retirement Benefits Authority (RBA) that revoked licenses of County Pension Fund (CPF) Financial Services and Local Authorities Pensions Trust (LAPTRUST).
RBA had on September 4, 2014 delisted CPF Financial Services, which is one of the largest administrators of pension schemes in Kenya.
The County Pension Fund Financial Services, formerly the Local Authorities Pensions Trust Administration Services Limited which controls assets in excess of Sh26 billion, however moved to the High Court through lawyer Donald Kipkorir to challenge the move.
High Court Judge Weldon Korir found that the process leading to the revocation of CPF was marred by irregularities and the firm was condemned unheard.
The process he said was unfair and the decision to appoint an inspector for LAPTRUST must have been informed by that improper process.
“The fact that RBA made a decision to deregister CPF before issuing the notice of intention to deregister can only lead to the conclusion that the statutory process had been breached. There was procedural impropriety,” he said.
The Retirements Benefit Authority he said cannot hide behind alleged grave irregularities on the part of the applicants or claim protection of public interest in order to cover its failings.
“RBA erred in its actions and no plea of good faith or protection of the interests of the funds members can salvage its decision as conveyed in the letter dated September 4, 2014,” he said.
Korir subsequently quashed the letter dated September 4, 2014 which appointed forensic inspection on LAPTRUST meaning no forensic audit will be carried out on the fund.
RBA in the letter directed LAPTRUST to surrender its certificates of registration for destruction and communicated its plans to deregister it. The regulator claimed that the board of trustees, a public entity, unlawfully registered itself as a corporate body.
But according to CPF, RBA acted in excess of its powers as it does not have power to deregister them or appoint a forensic auditor.
RBA in its response to the suit however said it gave CPF an opportunity to remedy the situation prior to issuing the notice of intention to deregister on June 4 2014.
According to the respondent, it had written to them asking it to address the concerns it had raised about its legal status and the charges for its services but instead of addressing the issues, they became evasive.
According to the court’s judgment, LAPTRUST Services Limited has since legally changed its name to CPF Financial Services limited but although the Authority had been informed of the change of name, it had refused to acknowledge the change.