The agency that controls Administrators Retirement and Pension Funds (AFJP, for its acronym in Spanish) does not have a rule setting how serious irregularities committed by companies are, nor does it have an objective criterion to determine the cost of any penalty.

A report by the Comptroller General's Office (SIGEN, for its acronym in Spanish) of 2007 on the Superintendence of the AFJP (SAFJP), points out that in the minutes of the court's disciplinary body it does not include the assessment of the fines imposed, and that this "prevents the evaluation and decisions taken from using the same criteria" to set how much should fines cost. In addition, the way the industry assesses Pension Control Administrators defaults is "inconsistent."

Inside the superintendence there are two sectors that have "significant differences in criteria" to assess the work of the administrators. These are the areas of Supervision and Provisional Control that "modify or dismiss" the observations together.

Moreover, research on possible damage to the pension fund recorded "excessive delays" that cause "requirement of administrative action, which prevents the application of fines to the administrators," says the SIGEN and adds that, however, the gap between the control, detection of an irregularity and the application of a fine may be, in some cases, up to 24 months.

The Audit Office also highlights the "inaction" of the Superintendence to claims or complaints of situations that would mean harm to members. In fact, "the agency has not depended exclusively on information and data that is provided by the directors," says the report. The SIGEN repeats this and other data in a work of 2006 (See: When a controller ...).

Another observation of the Watchdog, on which the Superintendent did not conduct any "corrective action," is the software designed to track the investment portfolio and valuing assets "is based on Excel spreadsheets that are loaded manually with data from various sources." This procedure explains the SIGEN "prevents ensuring the integrity, availability and confidentiality of information."

The inner workings of the superintendence also recorded irregularities. First, the database administered by the Department of Summaries and that which manages the entrance desk "have varying degrees of renovation", making it difficult to monitor the actions of the body. Moreover, the SIGEN did not find the minutes of meetings of the Supervisory Policy, the collegial body that analyzes the procedures of the administrators. "There are no monthly reports of the Internal Auditor (SAFJP) on the results of their activities," the Audit expands and adds that "neither annual report assessing the internal control environment of the administrators were sent."

Also, when the organic structure of the SAFJP changed, they eliminated the functions of the Planning and Regulation, which are related to the operation of pensions: "They were conferred to any responsible industry," says SIGEN. The situation is repeated with the tasks of design, preparation and approval of annual operating plans.

For its part, Management Entities Control registers an "inadequate planning" of its work. The Trustee states that in the period 2005-2007, it was not possible to determine the responsibilities of staff, and that the projects "lacked goals and objectives of control." Management also prepared the reports detailing its management, "which prevents verifying proper performance of their duties", completes the SIGEN.