Industry Associations

Basic Trace

Tracing Former Members

The Basic Trace provides retirement funds with a cost effective success-based service which utilizes a combination of telephonic and postal tracing techniques.

TDF has an internal Home Affairs database of over 34 million ID numbers to check and clean member data received, thereby enabling fund member data to be enhanced with identity numbers and deceased dates. This enhanced member data, inclusive of deceased dates, is delivered to clients within 10 business days of TDF receiving member records and a Batch Information Form, whichever occurs later.

Thereafter, TDF matches member records to potential contact information sourced from multiple third party and proprietary databases utilizing member name, initial and date of birth (including gender and ID number, if available). Leveraging strong data management skills and utilising its proprietary systems, TDF consistently achieves contact rates far in excess of competitors.

TDF call centre operates between 8am and 6pm Monday to Friday together with weekend and public holiday shifts. The multi-channel call centre utilises telephone, email, post, fax and sms with call centre consultants providing multi-lingual support.

TDF Call Centre currently handles an average of 15,000 unique records per month – with the ability to handle up to 40 000 unique member records per month. An average 68% of all records received by our call centre with potential contact information result in confirmed contact details. Data quality delivered to our clients is of paramount importance hence we make use of voice recording for improved audit and risk control while our system controls are continually being enhanced, with our internal QA team monitoring up to 5% of all calls made and forms captured. TDF provides clients with online access to real-time progress reports, downloadable spreadsheets and a searchable database. TDF has also performed system integration with a number of administrators to further improve communication and delivery of results.

Forensic Trace

While the TDF Basic Trace offers a cost effective and rapid trace service, it will not be able to address and resolve all member records that need to be traced. This is due to a number of factors, including:

• Invalid or incomplete member information received from a fund (incorrect date of birth, invalid initials and misspelt surnames and missing information);
• Maiden Names with no ID number;
• Emigrants;
• Deceased former members;
• Multiple possible individuals matching fund member data (up to 30 in certain instances); and
• Former member has no current contact information held by the 7 databases utilized by TDF during the Basic Trace Service.

Trace service

The Basic Trace is focused upon making contact with a specific individual based upon the member data provided by the fund in a volume based batch basis, not to perform a viral type investigate and trace.

In order to address these difficult cases, TDF is able to offer an investigative manual service known as a Forensic Trace. With a Forensic Trace, TDF perform a detailed and varied trace service to facilitate the tracing of former members, which include:

• Identification and contacting of possible relatives and former work colleagues;
• Contacting current residents of homes where the former member may have resided and/or next door neighbors;
• Utilizing social media channels;
• Tracing and verifying membership of individuals where personal details do not exactly match those provided by the fund (eg initials transposed, incorrect date of birth, incorrect gender or surname misspelt or missing information);
• Locating next of kin of deceased former members

TDF will provide a former member listing to the Fund of all records that have not been traced during the Basic Trace service within 45 business days. The fund can then determine whether to escalate these members to a Forensic Trace service after taking into account benefit value or remaining trace expense budget.

The Forensic Trace requires extensive individual and manual member record interrogation, fund administrator communication and exhaustive trace attempts, which result in increased associated costs and therefore carries a higher success based fee than the Basic Trace service. In our experience up to 35% of individuals who enter the Forensic Trace Service are traced, which is over and above the individuals traced under the Basic Trace Service.

The documentation service and benefits apply to the Forensic Trace as they do to the Basic Trace service.

Physical Trace

The Data Factory and Teba

The Data Factory (TDF) and Teba have concluded an agreement to provide TDF clients with a physical tracing service.

While the TDF Basic and Forensic Tracing Services provide clients with a faster and cheaper resolution service, a third level tracing service (ie physical tracing) will always enhance contact rates.

The Teba-TDF agreement provides TDF clients with the largest formal network of offices and tracing agents in South Africa, with a strong focus in rural areas and neighbouring countries. Due to significant price differential between physical and virtual tracing services, the client would need to authorise the Teba physical trace following the closure of active virtual tracing (telephonic and postal). The client could authorise physical tracing for certain records dependent upon benefit value.

All confirmed information and documentation successfully obtained by Teba will be available upon the TDF online system and hard copies distributed in the normal TDF manner resulting in a standard manner of communication of results and for queries.

The fees payable are on a success basis and no additional charges are payable, such as travel and accommodation costs.

The Teba Physical Tracing Footprint

With more than 101 offices in all traditional labour-sending areas and a presence on more than 26 mines, Teba has a unique footprint through which tracing services are provided. This uniqueness stems from the fact that Teba does not only cater for mines, mineworkers and their families in and around the mining areas, but also serve them within their rural communities.

In addition to offices in Kwa-Zulu Natal, Limpopo, Mpumalanga, Eastern Cape, Gauteng, Free State and the North West, Teba’s footprint includes offices in Botswana, Lesotho, Mozambique, Swaziland and Malawi. Each office has between one and four fieldworkers who perform tracing services. A full listing is available upon request.

It should be noted that TDF has entered into a separate physical tracing agreement with Lisa Consultants, a small 100% black-owned business, to provide physical tracing capabilities within the Western and Northern Cape. Lisa Consultants have over 5 years’ experience in tracing unclaimed benefit beneficiaries and are well versed in documentary requirements.

When combined with Level One Basic Trace and a Level Two Forensic Trace, the Physical Trace service provides funds with the most comprehensive tracing capability in South Africa.

Documentation Services

Whether in conjunction with our trace services or as a stand-alone service, TDF is able to assist funds with receipt, checking and capture of withdrawal option form information, and other mandatory documentation.

With documentation error levels (incorrect or incomplete) reaching 24% of all form returns and 36% of all traced members requiring 2 or more reminders to return documentation, it is imperative that administrators and funds utilise service providers who are able to maximise resolution rates in the shortest possible timeframe with the highest level of accuracy. A trace-only service offering tends to avoid a significant problem area in accurate and complete documentation collation. It places further pressure on fund administrator resources which could be better allocated to processing tax requirements and payment.

TDF has a separate, dedicated team focused upon following up on error documents returned and the return of documentation from previously traced members. TDF is able to incorporate client specific documents and requirements into our process flow which follows a formal SLA-driven approach covering outstanding forms  including ‘follow-ups’ and error resolutions utilizing email, sms and call centre resources with 7, 14, 21, 30 and 45 day ‘triggers’ which are system driven.

TDF earns its fee based upon the return of all required documentation to administrators to enable payment to be initiated. In this manner TDF remains continually incentivised to expedite and complete this process.

Online Access

TDF recognizes the need for administrators to have access to real time information in order to efficiently provide member service.

To address this requirement, all clients can, upon request, be provided with secure access to the TDF system in order to:

1. Search for a former member’s status (traced and completed, not traced or traced but documents outstanding) - this is important to determine whether tracing fees need to be deducted from a benefit payment;
2. Download member documents already submitted but not yet delivered to client or mislaid;
3. View the trace project progress and status reports.

Clients are also able to view the full audit trail of steps taken to trace an individual, by whom and dates.

Selecting a Tracing Service Provider

Deciding to actively address unclaimed benefits or unpaid surplus benefits that reside in a fund is without doubt the correct action, the difficulty though is appointing the most suitable service provider to achieve your objectives.

The problem is that anybody who has a telephone is calling themselves tracing agents and often make wildly optimistic statements in order to win business. However, trustees are not normally administration or tracing experts which means that if not all factors are taken into account in the decision making process, a positive step can result in negative and frustrating outcomes. It is also imperative that any due diligence undertaken ensures apples are compared with apples in terms of services offered.

Factors that should be considered:

• Experience and expertise in tracing unclaimed benefits for retirement funds;
• If a tracing service provider does not offer documentation services but merely the provision of contact information, the fund WILL be left with a significant burden in sending, receiving, checking and following up on documentation required. Irrespective of trace levels achieved, it is documentation levels achieved that dictate project success;
• Call Centre capability and expertise in addressing member queries and fund specific requirements, thereby relieving trustees and administrators of the huge burden from incoming member queries;
• Ability to handle the review, capture and correction of incoming option forms and other documentation;
• Formal follow-up processes for outstanding documentation;
• Ability to identify and correct incorrect former member data received from the fund;
• Method and frequency of delivering tracing results and documentation to the fund;
• Quality assessment and control procedures to reduce risk factors;
• Service Providers should only make use of LEGALLY obtained and useable databases for personal contact information. Funds need to ensure they are not contravening the National Credit Act and other personal information protection legislation through the engagement of tracing service providers. While obviously wanting to maximize trace rates, it cannot be achieved through the illegal use or access of databases such as Electoral Roll, RICA and Home Affairs, which are restricted by law. Trustees could, by association, be found guilty if they were or should have been aware of illegal data use.
• Different trace options available to maximize success levels;
• Additional services that can be provided to reduce workload at an administrator level which is constrained by resource shortages and easily results in unnecessary bottlenecks; and
• Internal fraud and error risk systems to protect fund against financial losses incurred.

Did you know the following as it relates to tracing projects?

• Up to 15% of unclaimed member data has incorrect or incomplete initials, incorrect surname spelling and invalid date of birth which a service provider must have the means to correct or else individual will not be traced;
• 36% of all individuals traced require a minimum of 2 follow-up calls to ensure forms are returned;
• 24% of all traced members return incomplete and incorrect option forms;
• 15% of all bank account details provided are invalid or payment will be rejected, even where bank statements are requested.

The Data Factory, certified level 4 BBBEE, is the leading tracing service provider providing a range of services to ensure that fund specific requirements can be addressed within processes that have been tried and tested. These processes have been refined and introduced while dealing with over 1,200 funds and 1,100,000 former members since 2004. The commitment to delivering a quality service has been recognized by the Principal Officer’s Association through being awarded the Imabasa Yegolide Tracing Agent of the Year Award for three consecutive years in 2010, 2011and 2012.

With respect to tracing, the company is able to offer 3 different levels of tracing (Basic, Forensic and Physical) in order to maximize success levels through applying different techniques and processes.

So what does The Data Factory offer?

A 14-Point Advantage

• FREE tax registration for members without a tax number to assist fund administrators and facilitate faster member payments;
• FREE independent bank account detail verification direct with bank to reduce risk of fraud and error payment;
• Ability to deliver documents and traced member details electronically on a daily basis;
• Ability to identify incorrect member data and correct in a material number of cases;
• Telephone call recording which provides audit trail and quality control;
• Multi-lingual, multi-channel and multi-shift call center;
• Strategies to reach members who have emigrated or live in rural areas, including social media and forensic tracing;
• Dedicated quality control personnel auditing 5% of all telephone calls and documents received/captured every month with minimum 95% compliance level set;
• Access to 52 million records covering individual’s personal and contact details;
• A success-based fee model with no take-on or initial charges;
• Online real-time reports, documents and search functionality for administrator and trustees;
• Formal outstanding and error document follow-up processes which are system driven 7, 14, 21, 30 and 45 days after initial contact using SMS, email and telephone; and
• A postal tracing strategy for no possible telephone numbers or invalid telephone numbers, to enhance contact rates.

By choosing The Data Factory you are able to leverage our experience and expertise without having to learn the hard way. Tried and Tested, the Way to Go.

Bank Account Verification

As a further value-add, all clients are offered our independent bank account verification service, Veribank, at no additional cost.

The Veribank service has electronic access to South African bank accounts to determine whether the provided bank account details are correct in terms of belonging to the member and the account/branch are in fact correct and open. TDF have found up to 15% of all bank account details submitted fail the initial verification process.

This service reduces risk in terms of fraud and error. In addition, the reduced verification function increases administration resource efficiencies reducing delays in processing payments.

The account verification services checks the following directly with the relevant bank:

• ID number BELONGS to Bank Account Number (ie bank account is registered to person);
• Bank Account is OPEN (ie will accept transfers);
• Bank Account Number is VALID (ie will accept transfers)
• Bank Sort Code is CORRECT (ie combination of bank account and bank sort code is valid).

Only when all the aforementioned are returned positive does the Veribank system advise a positive verification. At this point a Bank Account Verification Certificate is generated and included with other member documentation.

Where account details fail verification, TDF obtain corrected bank account information prior to submitting a record and documentation to the fund for payment. The followup of failed verifications is system driven through multiple channels including sms, email and telephone.

Document & Data Delivery Options

TDF recognises the resource intensive processes associated with unclaimed benefits and has developed a number of alternatives to traditional monthly delivery of files incorporating member documents.

Utilising our in-house developed RDS system, clients are able to receive daily or weekly emails to pre-determined email address/es of the following:

• Completed member documents;
  a. A singe email per member with all associated documents consolidated into a single pdf; and
  b. Flexible client determined pdf naming convention (eg member number_scheme code) to facilitate workflow;
• CSV with completed and confirmed member data;
  a. Client can instruct which member fields they require;
  b. Daily/Weekly CSV will only include those members completed and not previously included in a previous csv.

A client can determine whether they want option 1 and/or 2 above and the frequency thereof. In addition, the client will receive a separate email advising how many pdf emails were sent and/or member records included in csv sent that day. This enables a client to ensure they can identify if any emails have somehow gone missing.

The benefits associated with this document and data delivery service are numerous, including:

• Reduced delay to process member payments and improved member service;
• Client administration systems can be updated sooner to ensure former member communication is correct;
• Reduction in bottlenecks associated with monthly hard copy delivery;
• Potentially reduce need  and cost to print and scan as pdf can be automatically imported into workflow process.

TDF has also implemented full system integration processes to further enhance administration processes, incorporating daily document delivery by SFTP and member data files that adhere exactly to fund administrator system requirements.

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Unclaimed benefits and unpaid surplus

Unclaimed Benefits refer to any monies due to a person that remain unpaid or unclaimed.

Unpaid Retirement Fund monies are defined in terms of the South African Pensions Funds Act as Unclaimed Benefits 2 years after a member leaves a fund due to resignation, dismissal or retrenchment.

It must be understood that even if a previous employer was liquidated or closed down, the pension fund monies are not effected as they are maintained in a separate vehicle known as a fund (similar to a trust). In addition, there is no prescription period, which means that unclaimed benefits can never be lost if not claimed within a certain time period. In the event that a former member passes away before an unclaimed benefit can be paid, the next of kin will be due the unpaid monies.

Another area that is not necessarily understood, is that while an employee contributes on a monthly basis to a pension fund, the employer also pays a monthly contribution on behalf of the employee. When a person resigns or is retrenched or dismissed, the monthly contributions of both the employee and employer (together with investment growth) needs to be repaid to the former employer.

It is hard to comprehend how a person would not claim their money, but this happens every day. Through a combination of employee financial illiteracy along with administrative issues at pension funds, their administrators and employers, the extent of unclaimed benefits residing in pension funds continues to grow. The reason for members not receiving benefits due is that the fund administrators have no or invalid contact details on their records. People move on average every 4 years, they change cellphone numbers every 2 years, members emigrate and, unfortunately pass away before unpaid benefits can be paid. In addition, elderly people and individuals living in rural areas do not necessarily have formal telephone numbers and addresses. Those who have emigrated or tend to be very mobile, making for contact ability problems. Even if you were previously paid when you left a fund due to resignation or retrenchment, there exists a very real chance you may be owed additional monies for a number of reasons.

Unpaid Surplus monies  represent another reason for former members of retirement funds to be owed monies from pension funds they previously contributed towards.

The Pensions Funds Act was amended in 2001, whereby pension funds were forced to calculate whether the funds they held (assets) exceeded the estimated liabilities (monies that still needed to be paid to existing active members and pensioners). These surplus funds arose due to many reasons, but partly due to conservative estimates made by actuaries when calculating investment growth and outstanding liabilities. This resulted in former members being effectively underpaid when they left the pension fund. While not all pension funds had surpluses, Hundreds of funds reported Billions of Rands of surpluses owed to Millions of Former Members.

The legislation effectively states that if you left a fund any time after January 1980 you would qualify for potential surplus monies that are declared by the retirement fund. This means that people who left a company after contributing to a pension fund up to 43 years ago may have surplus monies due.

It is currently estimated that their exists in excess of circa R47.5 billion owed to circa 5 million South Africans in respect of unclaimed benefits and/or unpaid surplus monies.

Tracing Philosophy

The Data Factory offers a multi-level, multi-phased approach to tracing former members and beneficiaries recognising that a ‘one size fits all’ service is not applicable to all funds and members.

This is due to a number of considerations, including:

a. Completeness and integrity of member data;
b. Benefit Values and trace budget availability;
c. Time constraints; and
d. Trustee expectations for trace success levels.

Trustees are able to optimise cost benefit through a phased approach and potentially escalate untraced former members to the next level tracing service after taking into account success levels and benefit values unpaid.

Phase One: Basic Trace

• Initial phase, batch-based utilising call centre, sms, email and postal;
• Requires a minimum of initial, surname, and date of birth;
• Relies upon completeness and accuracy of fund member data, with data enhancement relating to matching unique ID numbers (if not provided);
• Attempts to contact member directly through matching of member data with third party contact databases;
• Fastest trace rate at lowest fee;
• Dependent upon data integrity, trace success levels are normally in the range of 3-60%; and
• Able to process large monthly volumes (20,000 member records).

Phase Two: Forensic Trace

• Investigative trace techniques performed (non-bath);
• Viral approach through, inter alia, property, former work colleague, neighbour and relative searches;
• Challenges fund member data by investigating alternate possibilites relating, inter alia, to surname spelling, date of birth and initials;
• Incorporates social media and internet searches;
• Higher fee due to significant manual intervention; and
• 30-40% trace success levels attached to this service.

Phase Three: Physical Trace

• Utilising ‘foot soliders’ to travel to addresses related to former member;
• Interview neighbours and work colleagues in an attempt to find new potential contact information;
• Especially effective in rural areas and neighbouring countries;
• More than 95 offices and 120 fieldworkers in South Africa and 5 Neighbouring Countries;
• Time Consuming and expensive process normally only applied to high value benefits that remain untraced after Basic and Forensic attempts.

Passive Digital Tracing (PDT)

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