The Employee Benefits Security Administration today answered questions about benefit plan fiduciary bonding and unveiled the 2008 Form 5500.
EBSA, an arm of the U.S. Labor Department, has published the bonding guidance in Field Assistance Bulletin, Number 2008-04.
Robert Doyle, an EBSA director, writes in the guidance that a benefit plan official must be bonded for at least $1,000 per plan, and for at least 10% of the amount of funds that the official handles.
For most plan officials, the maximum bond required is $500,000 per official per plan.
For officials of plans that hold employer securities, the maximum bond requirement increased to $1 million for plan years starting on or after Jan. 1, 2007, Doyle writes.
Section 412 of the Employee Retirement Income Security Act requires that a plan official bond protect the plan against losses caused by the bonded person’s direct or indirect acts of fraud or dishonesty, even if the bonded person did not profit from the acts.