DOL posts record financial recoveries for benefits plans

The Department of Labor recovered a record of more than $3.1 billion in fiscal year 2020 for retirement plan beneficiaries, the agency reported Tuesday.

That is roughly double the $1.6 billion the DOL collected from employers in its fiscal 2018 and significantly higher than the $2.6 billion in 2019, according to data from the agency. The recoveries represent assets restored to plans as result of investigations, voluntary plan corrections, the regulator’s abandoned-plan program and informal complaint resolution.

More than $2.6 billion of the assets returned to plans came through DOL investigations, the agency reported. In one recent case, the Employee Benefits Security Administration examined several instances of alleged theft between 2016 and 2018 from a Kentucky plumbing company’s benefits programs by the firm’s controller. That case led to prosecution, and the controller had to repay about $32,000 to the company’s 401(k) plan, in addition to other restitution of more than $800,000.

EBSA closed a reported 1,122 civil investigations during fiscal 2020, with about two-thirds ending with either financial restitution to plans or corrective action, such as removal of a plan fiduciary, appointment of an independent one or establishing new procedures, the DOL stated.

Much of that involved financial recovery for participants who were vested in a defined-benefit pension plan, but were terminated from employment, according to the agency. About $1.5 billion of the recovery fell into that category, with payments going to nearly 30,000 plan participants, the DOL reported.

Seventy people faced indictment as a result of EBSA investigations in fiscal 2020, “including plan officials, corporate officers and service providers — for offenses related to employee benefit plans,” the agency stated.

The post DOL posts record financial recoveries for benefits plans appeared first on InvestmentNews.

As our second lead editor, Cindy Hamilton covers health, fitness and other wellness topics. She is also instrumental in making sure the content on the site is clear and accurate for our readers. Cindy received a BA and an MA from NYU.

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