The Department of Labor (DOL)’s Employee Benefits Security Administration (EBSA) recovered more than $2.4 billion in direct payments for retirement plans, participants, and beneficiaries in fiscal year 2021. The EBSA doled out benefits of $1.548 billion owed to more than 16,000 terminated, vested participants in defined benefit (DB) plans.
Of the $2.4 billion restored, $1.9 billion came from recoveries from enforcement actions, while $499.5 million was from informal complaint resolutions. The Abandoned Plan Program was responsible for another $50.8 million, while the Voluntary Fiduciary Correction Program (VFCP) accounted for the remaining $34 million in recoveries.
“The Employee Benefits Security Administration works diligently to ensure American workers, retirees, and beneficiaries receive the benefits they have earned,” Acting Assistant Secretary for Employee Benefits Security Ali Khawar said in a statement. “The results for fiscal year 2021 underscore our commitment.”
During the fiscal year, the EBSA closed 1,072 civil investigations with 741, or 69%, of them resulting in monetary results for plans or other corrective action. The agency said recoveries on behalf of terminated, vested participants played a significant role in the results. Terminated, vested results represent a combination of the present values of lifetime annuity payments made to participants and beneficiaries, or lump-sum balance payments, plus interest distributions paid as either retroactive lump sums or included in actuarially adjusted future annuity amounts, according to the EBSA.
The agency’s enforcement program also obtained 449 non-monetary corrections during the fiscal year, including the removal of six fiduciaries, orders barring 34 individuals from acting as fiduciaries, court appointments of 16 independent fiduciaries, and 124 cases that involved reforms of plan procedures, such as improved search procedures for missing participants.
EBSA, which has oversight authority over nearly 734,000 retirement plans, is also responsible for investigating potential criminal conduct, including potential violations of the criminal provisions of the Employee Retirement Income Security Act (ERISA), as well as crimes that concern employee benefit plans, and financial crimes in general.
The agency opened 188 criminal investigations that involved plan officials, corporate officers, and plan service providers, and closed 208 during the fiscal year. It also obtained 38 guilty pleas or convictions and recovered nearly $4 million for the benefit of plans and participants. EBSA also barred 41 people convicted of crimes from serving as plan fiduciaries or service providers in accordance with the provisions of ERISA.
EBSA also provides incentives for fiduciaries and others to correct ERISA violations without becoming the subject of an enforcement action through the VFCP and Delinquent Filer Voluntary Compliance Program (DFVCP). In fiscal year 2021, EBSA received 1,201 applications for the VFCP and reported $34 million of restored payments. The DFVCP, which encourages plan administrators to bring their plans into compliance with ERISA requirements, received 22,553 annual reports during the year.
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Tags: Department of Labor, Employee Benefits Security Administration, Employee Retirement Income Security Act, enforcement program, ERISA, retirement plans