By Pension and Benefits Editorial Staff
The Employee Benefits Security Administration (EBSA) has issued the results of its enforcement and compliance activity for employee benefit plans and participants in fiscal year (FY) 2020. EBSA’s oversight authority extends to nearly 722,000 retirement plans, approximately 2.5 million health plans, and a similar number of other welfare benefit plans, such as those providing life or disability insurance. These plans cover about 154 million workers and their dependents and include assets of over $10.7 trillion.
In fiscal year (FY) 2020, EBSA recovered over $3.1 billion for direct payment to plans, participants, and beneficiaries. These recoveries resulted from enforcement actions and voluntary fiduciary corrections, as well as amounts recovered through the abandoned plan program and informal complaint resolution. The largest recoveries came from enforcement actions and informal complaint resolutions—$2.602 billion and $456.3 million, respectively.
Civil investigations. In FY 2020, EBSA closed 1,122 civil investigations with 754 of those cases (67%) resulting in monetary returns for plans or other corrective action. EBSA notes that recoveries for terminated vested participants was a large part of these results. Of over $2.6 billion recovered in its investigations, EBSA helped over 29,600 terminated vested participants in defined benefit plans collect benefits of over $1.48 billion due to them. Also, 82 cases were referred for litigation.
In addition to monetary results, EBSA’s enforcement program also obtains non-monetary corrections and injunctive relief that result in increased protections for plan assets or benefits. These actions can range from the removal or enjoinment of a plan fiduciary to the appointment of independent fiduciary as well as to the implementation of new plan procedures. During FY 2020, EBSA obtained significant non-monetary results in over 400 cases.
Criminal investigations. In addition, EBSA closed 230 criminal investigations in FY 2020. EBSA’s criminal investigations, as well as its participation in criminal investigations with other law enforcement agencies, led to the indictment of 70 individuals - including plan officials, corporate officers, and service providers - for offenses related to employee benefit plans. The number of criminal cases closed with guilty pleas or convictions was 59.
Abandoned plans and compliance programs. During FY 2020, EBSA received 1,161 applications from Qualified Termination Administrators and closed 1,110 applications with terminations approved, with 882 plans making distributions of $54 million directly to participants pursuant to the terminations.
Compliance assistance programs. In FY 2020, EBSA received 1,309 applications for the Voluntary Fiduciary Correction Program and 19,624 annual reports were received through Delinquent Filer Voluntary Compliance Program. In addition, the EFAST2 Help Desk handled over 20,000 filer inquiries to help filers meet their reporting obligations.
Workers’ informal requests for assistance. Demonstrating how effective EBSA is in resolving workers’ problems with their employee benefit plans, EBSA’s benefits advisors closed more than 171,000 inquiries and recovered $456.3 million in benefits on behalf of workers and their families through informal resolution of individual complaints in FY 2020. These inquiries are also a major source of enforcement leads. In FY 2020, 357 new investigations were opened as a result of referrals from the benefits advisors.
Education and outreach events. EBSA reported that it conducted 3,420 education and outreach events for workers, employers, plan officials and members of Congress in FY 2020. Of the 3,420 total events, 2,787 were total dislocated workers activities (with 956 dislocated worker rapid response sessions - a subset of total dislocated workers activities), 218 were Congressional briefings, 240 were compliance assistance activities, and 175 were other participant assistance and public awareness activites. EBSA also reaches the public through its printed materials and electronically on its website. FY 2020, EBSA reported that 221,887 publications were distributed, and its website had 4.2 million visitors.
Source: EBSA News Release No. 20-2017-NAT and EBSA Fact Sheet for FY 2020 enforcement and compliance activities.
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