EBSA Enforcement Actions to Protect Employee Contributions
The DOL’s Employee Benefits Security Administration (EBSA) recently announced a series of enforcement actions, including both civil and criminal cases, that are designed to protect employee contributions made to retirement and health plans. The EBSA continues its commitment to safeguard employee contributions to employee benefit programs by investigating situations where an employer may either improperly delay forwarding contributions to the employee benefit plan or use the contributions for other personal or business purposes. The agency’s first national criminal enforcement project, the Contributory Plan Criminal Project (CPCP), is designed to target persons committing fraud against participants and beneficiaries of contributory retirement and health plans. According to the CPCP Fact Sheet released by the EBSA, employers are not the only culprits – service providers may also gain access to retirement accounts and use employee contributions for their personal profit. In the criminal cases, the EBSA works with U.S. attorneys, as well as state and local law enforcement, to enforce laws safeguarding plan assets. Those convicted of embezzlement or misappropriation of employee funds can face severe criminal penalties, including imprisonment, and are typically barred from providing services or acting in any fiduciary capacity for a period of 13 years. To date, there have been 191 investigations initiated under the criminal project, of which 97 were referred to prosecutors, and 20 indictments have been obtained.
The DOL also published a list of "10 Warning Signs That Your 401(k) Contributions Are Being Misused," which educates employees by providing them a list of warning signs that a potential problem may exist in their retirement account.
A list of enforcement actions, the Contributory Plans Criminal Project Fact Sheet and the "10 Warning Signs" are available at the DOL’s website at http://www.dol.gov/ebsa.