PenCom seeks EFCC’s intervention as employers withhold workers’ pension contributions

The National Pension Commission (PenCom) has sought the intervention of the Economic and Financial Crimes Commission (EFCC) to tackle growing cases of pension fraud, particularly the failure of employers to remit pension contributions deducted from workers’ salaries.

The commission said the practice, in which employers deduct employees’ mandatory pension contributions but fail to transfer the funds into their Retirement Savings Accounts (RSAs), was depriving workers of their retirement benefits and exposing retirees to financial hardship.

Omolola Oloworaran, Director-General of PenCom, appealed on Thursday, when she led a delegation from the commission to the EFCC headquarters in Abuja.

Oloworaran expressed concern over the failure of several employers to comply with the mandatory pension contribution requirements under the Pension Reform Act 2004, noting that some organisations not only withhold their own contributions but also deduct employees’ contributions without remitting the funds to their respective retirement savings accounts.

Under the contributory pension arrangement, employers are required to contribute 10 per cent of employees’ monthly emoluments, while workers contribute eight per cent.

The PenCom Director-General described the situation as a serious financial offence against Nigerian workers and called for stronger enforcement measures to recover the outstanding funds and ensure that defaulting employers are held accountable.

“Employees are stealing from Nigerians. And we need a way to recover these monies from them. We are looking for a more effective way to manage this situation. We believe you can help us. We think that the EFCC is better placed to manage this issue,” she said.

She commended the anti-graft agency for its efforts in combating financial crimes and expressed confidence that its investigative and enforcement capacity would help address the persistent problem of pension contribution defaults.

Also speaking, Ahmed Lawan, acting Director of the Compliance and Enforcement Department at PenCom, identified the withholding of pension contributions already deducted from employees’ salaries as a major concern.

He said the practice had denied many workers access to funds meant to secure their financial future after retirement, contributing to the hardship experienced by some retirees.

Lawan stressed the need for an effective enforcement mechanism and a formal framework of cooperation between both agencies to tackle the problem.

“We need an effective and efficient way to handle this. We need a framework of collaboration between PenCom and EFCC to address this menace,” he said.

Responding, Ola Olukoyede, Executive Chairman of the EFCC, described the non-remittance of pension contributions as fraudulent and pledged the commission’s commitment to investigating the allegations and bringing those responsible to justice.

Olukoyede, who was represented by Michael Nzekwe, his chief of staff, said the agency would give the matter accelerated attention, adding that it had previously handled similar cases.

He assured PenCom that the commission would investigate the alleged violations and take necessary steps to ensure that outstanding pension contributions were recovered.

“That’s fraud. We have had to deal with such issues before now. We will deal with this one also. We will look deeply into it; and I can assure whatever needs to be done would be done to ensure all the outstanding monies are recovered,” he said.

The EFCC chairman further pledged the agency’s support in addressing fraudulent practices within the pension industry, describing such activities as particularly harmful because of their implications for the financial security and welfare of Nigerian workers and retirees.