AFPs retain nearly $ 178 billion belonging to deceased contributors

Experts assure that the money that the administrators could be creating business opportunities with the money coming from the vacant inheritances that have not been withdrawn for decades.

Almost four decades ago in Chile the pension fund managers made their appearance, a system that initially promised generous pensions for the future and that, over the years, has aroused a series of criticism and rejection in the population.

Since their arrival, financial institutions have had thousands of people who have died, who left amounts that have not been collected by any heir and have remained in the companies.

According to a 24 Hours report, 173,688 contributors have died in these years, whose funds correspond to about 170 billion pesos for vacant inheritance, amounts that have remained in the power of the AFPS.

AFPs retain nearly $ 178 billion belonging to deceased contributors
Experts assure that the money that the administrators could be creating business opportunities with the money coming from the vacant inheritances that have not been withdrawn for decades.

Almost four decades ago in Chile the pension fund managers made their appearance, a system that initially promised generous pensions for the future and that, over the years, has aroused a series of criticism and rejection in the population.

Since their arrival, financial institutions have had thousands of people who have died, who left amounts that have not been collected by any heir and have remained in the companies.

According to a 24 Hours report, 173,688 contributors have died in these years, whose funds correspond to about 170 billion pesos for vacant inheritance, amounts that have remained in the power of the AFPS.

More information: There are 261 million dollars in unpaid AFPs: So you can know if you have any amount

“It is shameful that one has money that does not correspond to him and that he does nothing because whoever should get it gets it back. There is a certain hint of freshness here, ”said the president of the Validame Foundation, Juan Carlos Pizarro, who reported this situation to the Superintendency of Pensions (SP).

According to his complaint, on several occasions the foundation asked the SP for transparency, the body that should be in charge of encouraging the withdrawal of such funds.

Official information indicates that, between 1980 and 2017, insurers have conserved a large amount of resources corresponding to vacant inheritances. In detail, AFP Provida is the one with the largest amount (almost $ 79 billion), followed by AFP Capital ($ 38.5 billion), AFP Habitat ($ 27.2 billion), AFP Planvital ($ 15,500), AFP Cuprum ($ 9 billion) and AFP Modelo ($ 8 billion).

More information: Pension reform: Government ensures that AFPs will not get involved in the management of the additional 4%

The lawyer and professor at the Law School of the Catholic University, Patricio Carvajal, assures in the report that although these amounts do not belong to the AFPs, they are generating economic profits for the institutions.

“The AFP itself will benefit from being an agent in the economy even more important than it already is. In simple terms, being a shareholder in the market with many more shares thanks to this money that would have to be in the hands of the Treasury ”, he says.

This situation is ruled out by the manager of the AFP Association, Fernando Larraín: “The AFPs do not charge a profit and, therefore, do not have any profit of any kind from the management of inheritances (…) and regarding the market power with the inheritances, when one looks at the amount of inheritances with respect to the accumulated pension fund, it is less than 0.5% ”.

Recently, on its website, the Superintendency of Pensions updated (for the first time in eight years) the records of people who have inherited monies that have not been claimed. However, many times the heirs do not know that the deceased had funds in the AFPs and that they are eventual beneficiaries of such amounts.