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Bankruptcy: Can't withdraw EPF age 55?

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asked on Sep 19, 2008 at 22:39
by   Miss Lau
edited on Dec 28, 2016 at 06:18
 
My father aged 54 now and facing bankruptcy soon. Since a bankrupt person can't have bank account, surely he will not able to draw his EPF after age 55. Can he put my name as beneficiary? Hoping that when he has passed away, I still manage to take over his fund in the future and take care of my mum. Will the bank or Bank Negara (BNM) seize his EPF contribution?

Really need some one advice...
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answered on Dec 25, 2017 at 04:50
by   Arjuna Sakayakirti
edited Jan 5, 2018 at 06:20
 
I note with interest on a salient point brought up by Ms. Lau, where you (Jeff) opined that a person can still open a savings account with another bank and have the EPF banked in.

I too am aware of that. But all banks are internetworked, your dealings with another bank are transparent to all banks locally. Your status quo with one creditor bank is known to every other local bank in Malaysia.....and even if you get past the check and balance of one bank, the Central Bank will route every transaction you make to their CCRIS servers and it will be a zero-sum situation again.

To just keep it short and simple, a person can open an account in any bank where his account has not been garnished and EPF money will be credited, but when you attempt to withdraw the money, the bank's legacy systems be will hot-tagged "alerted" and you transaction will be barred.

I was once working in two banks IT Division, and as far as I know, the only option is to appoint a nominee/proxy (e.g. Amanah Raya) or to name your beneficiaries that in the event of your death, they will be entitled to your money without hassle. Sad as it is, you will not get any assistance from the Insolvency Department... your laws are not structured in favour of the debtor and still heavily inclined to the creditors.
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answered on Dec 25, 2017 at 10:07
by   jeff005
edited Jan 5, 2018 at 06:27
 
@ Arjuna Sakayakirti

First and foremost, it is very helpful to have you writing on this forum to share information and being a foreigner. On top of that you have worked in the banking industry in IT Division.

The purpose of my this post is not to make disparagement or misconstrue any writings.
I can safely assume that the above were directed to me as per  "where you (Jeff) opined". The original  "jeffery" is not me as I joined this forum in Aug 2014 only.

My questions are :-

1.  But all banks are internetworked, your dealings with another bank are transparent to all banks locally
My opinions on the above topic refers to opening of  NEW  Joint Savings Account with the bankrupt's name as second name. Does the operations within savings accounts falls "within transparency" between all banks. When I withdrew RM 100 from my CIMB joint savings account, all banks in Malaysia knows about this? What happens to PDPA 2015? (I not referring to using checking accounts)

2.  Your status quo with one creditor bank is known to every other local bank in Malaysia.
Are you referring to blacklisting / termination of banking accounts from Bank Negara Malaysia (BNM) for Bankrupts (all accounts closed) or for opening of accounts for abused usage of any type of banking accounts? Nowadays, even "bouncing" of 2 or 3 company or personal checking accounts warrants  hot-tagging or red-flagging.

3. and even if you get past the check and balance of one bank, the Central Bank will route every transaction you make to their CCRIS servers and it will be a zero-sum situation again.
The above topic refers to Joint Savings Accounts.  Is it reflected on personal  BNM CCRIS?  I thought CCRIS is for financial records within the banking Institutions as regulated by BNM. I paid monthly cash of RM500 to a Hire Purhase Company (non banks) for a motorcycle, it will be documented with BNM and will be known to ALL  banks? CTOS should be useless now.

Hope to hear a reply on your opinions on my questions, I thank you in advance.
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answered on Dec 25, 2017 at 10:48
by   jeff005
edited Jan 5, 2018 at 06:33
 
@ Arjuna Sakayakirti

a person can open an account in any bank where his account has not been garnished 
Fully agree

EPF money will be credited, but when you attempt to withdraw the money, the bank's legacy systems be will hot-tagged "alerted" and you transaction will be barred. 
Do not agree on certain circumstances
Garnishee Order is for the "taking" of any balances cash on any banking accounts (exception Investments accounts) and is from ONE creditor to one particular bank ONLY and is renewable and valid for a period of 1 year.( unless laws have changed nowadays).

For a Bankrupt  , it is the closing of  ALL banking accounts (including investments accounts) by  BNM  and the proceeds is transferred into the  estate  of the bankrupt  @JIM1

Some hot tagging / red alerts are own banks proactive in-house procedures and is not Law based. It can be challenged in the Malaya Courts of Law.

In any case  EPF is Creditors' Proof  (while it remains inside).
Payments by EPF nowadays, is by cash cheque (now very difficult to get unless with letter from JIM (Jabatan Insolvensi Malaysia), direct debit to banks accounts or EPF cheques (usually  RHB)
Note.. a non-bankrupt could have all banking accounts closed, terminated or frozen but still can make EPF withdrawals @50 @55 @60.

the only option is to appoint a nominee/proxy (e.g. Amanah Raya) or to name your beneficiaries that in the event of your death, they will be entitled to your money without hassle.
No undue comments from me, a non-muslim. Amanah Raya has tints of Islamic Laws entrenched.
Civil Insurance laws is avoiding on  "beneficiaries" , only use  "nominees" nowadays, unless it is @Trust WILLS.  EPF  have only "nominees" only nowadays. (You sell Amanah Raya ?) Can teach me the Terms and Conditions of inside those agreements?

Amanah Raya :- What if about a beneficiary  dies before the account  holder's demise, can the names of the beneficiary changed (even for non bankrupts). There are 2 documented cases on this forum which stated that it goes to the estate of deceased. And if that deceased is a undischarged bankrupt, can almost say bye-bye to most of those moneys.
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answered on Dec 25, 2017 at 13:11
by   jeff005
edited Jan 5, 2018 at 06:41
 
@ Arjuna Sakayakirti

the only option is to appoint a nominee/proxy (e.g. Amanah Raya) or to name your beneficiaries that in the event of your death,
I beg to differ, under bankruptcy laws, investments proceeds from a deceased are channel into the estate of the bankrupt (while still being a bankrupt). No other laws can supersede this Bankruptcy Act.  It is an ACT  not only law. Death does not deletes or wipe out one's  DEBT. Even some types of insurance policies can be used to pay POD creditors in a bankrupt's eset.
One operating procedure from the banks you have worked before should have this operating procedure :-  "For withdrawals due to death, be it joint or single name accounts, certifications or confirmations must be obtained from the Insolvency Dept. Your ex banks do not have it notifications of the hundreds of software installed? Suggest to change IT vendors.

you will not get any assistance from the Insolvency Department.....your laws are not structured in favour of the debtor and still heavily inclined to the creditors. 
You mean that bankruptcy laws in Singapore and Indonesia differ drastically? More debtors friendly?
Can you show the deficiencies of our Malaysian Bankruptcy Laws? Am really interested to know.
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