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Archived News Release--Caution:
information may be out of date.
For more information call: (202) 219-8211.
Secretary of Labor Robert B. Reich today launched a
campaign against pension fraud that includes 10 warning signs workers can use
to protect their 401(k) plan contributions from employers who may misuse the
money.
The consumer campaign is part of a nationwide anti-fraud
program by DOL's Pension and Welfare Benefits Administration (PWBA), which
oversees federal laws governing private pensions.
More than 300 companies nationwide are being investigated
for potential violations, both civil and criminal. Since the effort began
earlier this year, more than 100 other cases have been closed, resulting in the
recovery of more than $3.2 million for more than 2,800 workers.
Reich said, "The vast majority of 401(k)s are safe and
honest, but we've found that in some cases, employers are taking money from
401(k)s. That's wrong and we want to stop it - that's what this enforcement
effort is about. We need consumers' help to track down fraud."
PWBA investigators are working with federal, state and
local prosecutors on the cases, Reich said.
The 10 warning signs released by Reich which consumers
should use when monitoring their 401(k) plans are:
- Your 401(k) statement is consistently late or comes at irregular
intervals.
- Your 401(k) account balance doesn't appear to be accurate.
- Your employer held your contribution for more than 90 days.
- A significant drop in your account balance that can't be explained
by normal market ups-and-downs.
- 401(k) statement shows your contribution from your paychecks wasn't
made.
- Investments listed in your account balance aren't what you
authorized.
- Former employees are having trouble getting their benefits paid on
time or in correct amounts.
- Unusual transactions, such as a loan to the employer, a corporate
officer, or one of the plan trustees.
- Frequent and unexplained changes in investment managers or
consultants.
- Your employer has recently experienced severe financial
difficulty.
"We will aggressively investigate to make sure that money
is invested in workers' 401(k) plans, but it is the workers themselves who will
be the first line of defense. That's why we're issuing these warning signs - to
help workers ask the right questions," said Reich. "The law requires that
workers be given statements and information about their 401(k) plans and
contributions and they need to be informed so they know what to look for."
Reich suggests that people who have questions about their
401(k) plans, and who are unable to resolve them with their employer or plan
administrator, can call PWBA regional offices, or the PWBA national office.
Archived News Release--Caution:
information may be out of date.
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