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Employee Benefits Security Administration

EBSA Achieves Total Monetary Results Exceeding $1.7 Billion

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U.S. Department of Labor
Employee Benefits Security Administration
January 2006

Through its enforcement of the Employee Retirement Income Security Act (ERISA), the Employee Benefits Security Administration (EBSA) is responsible for ensuring the integrity of the private employee benefit plan system in the United States. EBSA’s oversight authority extends to approximately 730,000 pension plans and another 6 million health and welfare plans. These plans cover approximately 150 million workers and their dependents and include assets of more than $4 trillion.

The financial impact of EBSA’s activities is impressive. Total monetary results for FY 2005 were more than $1.7 billion– the second highest annual result in agency history. Included in this figure is $709 million in assets restored to plans and benefits recovered for individual workers – an increase of nearly 120% over FY 2004, and up 161% from FY 2001.

Total Monetary Results

FY2001

FY2002

FY2003

FY2004

FY2005

% Change
FY01-FY05

Total Results

$721
million

$883
million

$1.4
billion

$3.1
billion

$1.7
billion

+136%

Prohibited Transactions Corrected and Plan Assets Protected

$444.6
million

$566.1
million

$1.12
billion

$2.53
billion

$984.6
million

+121%

Plan Assets Restored and Participant Benefits Recovered

$272.2
million

$315
million

$275.3
million

$323.9
million

$709.3
million

+161%

Voluntary Fiduciary Correction Program

$4.2
million

$1.9
million

$8.7
million

$264.6
million

$7.4
million

+76%

Percentage of Civil Investigations Closed “With Results” Increased by 9%

In FY 2005, EBSA closed 3,782 civil investigations, with 2,862 (75.67%) resulting in monetary results for plans or other corrective action. Because of improved targeting, the proportion of investigations closed “with results” increased by 9% over FY 2004 and 32% from FY 2001. The total civil cases closed decreased in FY 2005 from recent years due to more resource-intensive investigations.

EBSA often pursues voluntary compliance as a means to correct violations and restore losses to employee benefit plans. However, in cases where voluntary compliance efforts have failed, or which involve issues for which voluntary compliance is not appropriate, EBSA forwards a recommendation to the Solicitor of Labor that litigation be initiated. In FY 2005, 258 cases were referred for litigation. Together, EBSA and the Solicitor of Labor determine which cases are appropriate for litigation, considering the ability to obtain meaningful relief through litigation, cost of litigation, viability of other enforcement options, and agency enforcement priorities. Nationwide in FY 2005, litigation was filed in 178 civil cases.(1)

 Civil Investigations

FY2001

FY2002

FY2003

FY2004

FY2005

% Change
FY01-FY05

Civil Investigations Closed

4,762

4,925

4,253

4,399

3,782

-21%

Civil Investigations Closed with Results

2,724

2,877

2,939

3,056

2,862

+5%

% Civil Investigations Closed with Results

57.20%

58.42%

69.10%

69.47%

75.67%

+32%

Civil Cases Referred for Litigation

199

241

291

310

258

+30%

Civil Cases With Litigation Filed

73

104

108

125

178

+144%

EBSA Investigations Led to the Indictment of 106 Persons for Crimes Related to Employee Benefit Plans

EBSA has responsibility to enforce the criminal provisions under ERISA and criminal provisions under Title 18 of the United States Code that relate to employee benefit plans. EBSA conducts criminal investigations in consultation with the U.S. Attorneys office and, in many instances, jointly with other federal and state law enforcement agencies.

In FY 2005, EBSA closed 196 criminal investigations. EBSA’s criminal investigations, as well as its participation in criminal investigations with other law enforcement agencies, led to the indictment of 106 individuals – including plan officials, corporate officers, and service providers – for offenses related to employee benefit plans. The agency also achieved a 13% increase in the number of criminal investigations closed with either a guilty plea or with a criminal conviction.

Criminal Investigations

FY2001

FY2002

FY2003

FY2004

FY2005

% Change
FY01-FY05

Criminal Investigations Closed

143

154

175

152

196

+37%

Criminal Investigations Closed with Guilty Pleas or Convictions

49

49

57

62

70

+43%

Number of Individuals Indicted

87

134

137

121

106

+22%

Compliance Assistance Programs Yielded Tremendous Results

EBSA’s Voluntary Fiduciary Correction Program (VFCP) and Delinquent Filer Voluntary Compliance (DFVC) Program encourage the correction of violations of ERISA by providing incentives for fiduciaries and others to self-correct - thus allowing EBSA to target its enforcement resources effectively.

The VFCP allows plan officials who have identified certain violations of ERISA to take corrective action to remedy the breaches and voluntarily report the violations to EBSA, without becoming the subject of an enforcement action. In FY 2005, EBSA received 985 applications for the VFCP – a 108% increase over FY 2004. In FY 2005, applicants restored $7.4 million in assets to employee benefit plans through this program.

The DFVC Program encourages plan administrators to bring their plans into compliance with ERISA’s filing requirements. Since a major program revision in 2002, the program receives an average of over 1,000 previously un-filed annual reports each month.

Correction Programs

FY2001

FY2002

FY2003

FY2004

FY2005

% Change
FY01-FY05

VFCP Applications Received

62

55

240

474

985

+1,489%

DFVC Program Filings Received

2,609

3,023

11,573

13,808

13,322

+411%

Record $88.4 Million Restored to Workers through Informal Complaint Resolution

When workers experience a problem with an employee benefit plan, EBSA has proven effective in resolving their requests for assistance. In FY 2005, EBSA’s Benefits Advisors handled nearly 160,000 inquiries and recovered $88.4 million in benefits on behalf of workers and their families through informal resolution of individual complaints. Many of these inquiries were received via EBSA’s toll-free number: 1.866.444.EBSA (3272) and Web site: www.askebsa.dol.gov.

These inquiries are also a major source of enforcement leads. When EBSA becomes aware of repeated complaints with respect to a particular plan, employer, or service provider, or when there is information indicating a suspected fiduciary breach, the matter is referred for investigation. In FY 2005, 1,067 new investigations were opened as a result of referrals from Benefits Advisors.

Inquiry Statistics

FY2001

FY2002

FY2003

FY2004

FY2005

% Change
FY01-FY05

Total Inquiries

169,724

184,851

173,598

163,221

159,828

-6%

Monetary Benefit Recoveries from Informal Complaint Resolution

$64,313,311

$48,684,858

$82,906,277

$76,428,256

$88,380,247

+37%

Investigations Opened from Inquiry Referrals

1,251

1,347

1,362

1,069

1,067

-15%

Nearly 2,000 Education and Outreach Events Held in FY 2005

EBSA also conducts education and outreach events for workers, employers, plan officials and members of Congress. These nationwide activities include assisting dislocated workers who are facing job loss, educating employers of their obligations under ERISA, using a train-the-trainer format to inform Congressional staff of EBSA programs for their use in constituent services, and providing employees with information concerning their rights under the law. In FY 2005, EBSA conducted 1,947 outreach events.

Outreach, Education & Assistance Statistics

FY2001

FY2002

FY2003

FY2004

FY2005

% Change
FY01-FY05

Dislocated Worker Rapid Response Sessions

245

858

695

674

651

+166%

Congressional Briefings

95

78

215

290

197

+107%

Compliance Assistance Activities

219

257

458

576

598

+173%

Other Participant Assistance/Public Awareness

500

417

711

572

501

+.2%

Total Outreach Events

1,059

1,610

2,079

2,112

1,947

+84%

Overall, EBSA’s results demonstrate a strong, fair, and effective program that protects the benefits of America’s workers and retirees.

Footnotes

  1. EBSA cases referred to the Solicitor's office for litigation are often resolved, with monetary payments, short of litigation.

This fact sheet has been developed by the U.S. Department of Labor, Employee Benefits Security Administration, Washington, DC 20210. It will be made available in alternate formats upon request: Voice phone: 202.693.8664; TTY: 202.501.3911. In addition, the information in this fact sheet constitutes a small entity compliance guide for purposes of the Small Business Regulatory Enforcement Fairness Act of 1996.