$16m dividends unclaimed: SECZ

$16m dividends unclaimed: SECZ

Source: $16m dividends unclaimed: SECZ | The Herald June 7, 2017

Business Reporter
CAPITAL markets regulator, the Securities and Exchange Commission of Zimbabwe, has said there are an estimated $16 million worth of unclaimed dividends since dollarisation.Ideally, after dividend declarations, transfer secretaries are required to disburse the dividend proceeds to shareholders in the form of cheques or transfers. However, it emerged some shareholders did not cash in their cheques over time resulting in the accumulation of the unclaimed dividends.

SECZ chief executive officer Mr Tafadzwa Chinamo told The Herald Business that the regulator had worked on modalities with transfer secretaries that would make them custodians and account for such dividends.

“This came from auditors who found out there were many instances where companies declare dividend. But over the years, they found out that a lot of these dividend cheques were not being deposited,” said Mr Chinamo in an interview.

“As of now, it should be about $16 million worth of such dividends, the companies involved are those which pay dividend regularly,” he said. Stocks such as Delta, British American Tobacco and CBZ Holdings Limited are some of the listed companies consistent in paying dividends.

Indications are that some of the dividend cheques came in small amounts, which were not motivating enough for shareholders to deposit. In some instances, some companies would demand the outstanding balances back into their accounts which Mr Chinamo said was “not proper”.

In line with this, Mr Chinamo said the regulator would require transfer secretaries to open accounts for each dividend declaration, monitor the pay outs as well as the unclaimed amounts. This will enable the shareholders to claim their dividends anytime.

“We don’t want a situation where companies take back that money; it is not theirs, it is shareholders’ money. We are making the transfer secretaries accountable for such dividends.

“Transfer secretaries should create an account for each dividend payment and report to us on regular basis the status of that, if someone does comes to claim their dividend they should also show us how they have processed it,” said Mr Chinamo. He also underscored the need to simplify the whole process of investing on the stock market to attract participation on the bourse.

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