Reforms Approved to Curb Fraud in Afore Unemployment Withdrawals
The Chamber of Deputies unanimously approved a reform to Article 191 of the Social Security Law, aimed at combating fraudulent practices in unemployment withdrawals from Retirement Fund Administrators (Afores). The amendment, promoted by the National Commission of the Retirement Savings System (Consar) and currently under discussion in the Senate, seeks to calculate withdrawals under Modality A based on the average salary of the last 52 weeks of contributions, instead of the last salary registered with the Mexican Social Security Institute (IMSS).
The reform is a response to a phenomenon detected by authorities, in which private firms exploit legal loopholes to register workers for just one day with a high salary, in order to simulate higher income and thus increase the amount withdrawn for unemployment. These operations, which can cost up to 10,000 pesos per transaction, directly impact workers’ retirement savings and, at the same time, put the sustainability of Mexico’s pension system at risk.
Official statistics show that 68.8% of the total withdrawn for unemployment between January and April 2025 were processed through these intermediaries. Additionally, unemployment withdrawals increased by 12.7% in 2024 compared to the previous year, and as of April 2025, they have already risen by 11.2% over the same period of 2024. Most of these withdrawals are concentrated among people who have been unemployed for less than two months and those reporting salaries significantly higher than average, reinforcing the hypothesis of data manipulation by intermediaries.
According to Consar, the new framework will preserve workers’ right to access their funds in case of unemployment, but now under fairer criteria that align with their real employment history. For accounts older than three years with at least 12 bimonthly contributions, it will be possible to withdraw up to 30 days of the average salary from the last 52 weeks, with a cap of 10 Units of Measure and Update (UMAs). For those who have had their accounts for more than five years, the maximum withdrawal will be the lesser of 90 days’ average salary from the last 250 weeks (or of the available weeks contributed) and 11.5% of the total balance.
In the macroeconomic context, the reform takes place amid growing challenges to Mexico’s social security framework. Distortions in the retirement system and the rise of fraudulent practices threaten the financial viability of the Afores and the future of pensions. By strengthening control mechanisms and enhancing oversight of withdrawals, the reform aims to preserve the integrity of the system and promote a culture of responsible retirement savings.
In the medium and long term, these measures are expected to help prevent premature or manipulated withdrawals from further eroding retirement savings. Likewise, public policy should continue to focus on improving financial education and closing loopholes for unauthorized intermediaries, ensuring that the benefits of social security truly reach those who need them most.
In conclusion, the approved reform represents a significant step in protecting the retirement savings of millions of Mexicans. While the right to access funds in case of unemployment will remain, the proposed changes aim to ensure that these provisions fairly reflect each worker’s employment history, thus strengthening one of the fundamental pillars of the country’s pension system.
