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Regulation and Compliance > Federal Regulation > DOL

DOL Continues Aggressive Enforcement Pace in 2019

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The Labor Department’s Employee Benefits Security Administration recovered more than $2.5 billion in payments to plans, participants and beneficiaries and recovered more than $2 billion from its investigations in fiscal 2019.

EBSA also reported late Thursday that its criminal investigations led to the indictment of 76 individuals — including plan officials, corporate officers and service providers — for offenses related to employee benefit plans.

Under its Terminated Vested Participant Project — a major enforcement priority — EBSA helped participants collect nearly $1.5 billion in retirement benefits in the form of lump sum payments, present value of lifetime annuity payments and interest.

“Overall, these numbers reflect a continued high level of enforcement activity by the DOL,” said Joshua Lichtenstein, a partner at Ropes & Gray in New York who focuses on ERISA and employee benefits.

EBSA’s activity “reflects a significant increase in recovered amounts for plans and plan participants versus prior years, with nearly $1 billion more in recoveries than 2018 despite a reduction in the number of closed civil investigations compared to the prior year,” Lichtenstein said.

“A significant portion of the recovery is related to the DOL’s terminated vested participant program, which has seen steady increases each year since it became a DOL focus,” Lichtenstein added.

Labor “has been concerned that people who are no longer at an employer but have vested benefits are not getting paid out because they failed to update the plan on changes in their contact information (address, phone number, etc.).”

The Terminated Vested Participant Project “has been focused on getting employers/plans to maintain current census data and make sure people get the benefit payments they are entitled to. It’s been a major enforcement priority over the past few years,” Lichtenstein said.

The Office of Outreach, Education and Assistance’s benefit advisors returned $510 million to workers and their families through its informal complaint resolution process.

Meanwhile, EBSA also reported that in FY 2019, 661 plans made distributions totaling $33.2 million to participants under its Abandoned Plan Program.

EBSA continued its outreach to plan fiduciaries and others to participate in the Voluntary Fiduciary Correction Program (VFCP), and Delinquent Filer Voluntary Compliance Program to encourage the correction of ERISA violations.

“These programs provide incentives for fiduciaries and others to self-correct by reducing or eliminating potential penalties and/or avoiding other adverse consequences,” EBSA said. “In FY 2019, EBSA received over 20,000 delinquent filings and 1,600 applications for the VFCP.

VFCP corrections totaled $14.6 million during FY 2019.

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