Retirement planning officials take note: The Obama administration is ramping up enforcement efforts to combat the large number of retirement plans that it says are not compliant with retirement planning rules and regulations.
The Department of Labor has stated that 77% of 401(k) plans are noncompliant “in some form,” said John Carl, president of the Retirement Learning Center, which is sponsored by Columbia Management, the investment manager owned by Ameriprise Financial, at the SPARK Institute’s national conference in Washington on Tuesday.
While 2009 was a bad year for the economy, Carl said, it wasn’t so bad for DOL — it managed to add 997 employees that year — with 70% of those employees added to its enforcement division. The department’s Employee Benefits Security Administration (EBSA), for instance, saw a 28% budget increase in 2009, and EBSA added 29 enforcement personnel.
Carl also said that at the end of 2010, the Internal Revenue Service’s employer plan division disclosed its list of “plan sponsor audit targets” — U.S. companies owned by foreign entities; 403(b) plans; and small business owners.