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U.S. Department of Labor
EBSA
November 2003
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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 nearly $4 trillion.
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The financial impact of EBSA’s activities is impressive. For the first time
ever, total monetary results were more than $1.4 billion in FY 2003 – an
increase of nearly 60% over FY 2002.
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Total
Monetary Results
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FY
2002
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FY
2003
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Change
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Plan Assets Restored or Protected, Prohibited Transactions Corrected,
Participant Benefits Recovered |
$881,107,261 |
$1,397,606,776 |
58.62% |
Monetary Results of Approved Voluntary Fiduciary Correction Program
Applications |
$1,949,898 |
$8,736,232 |
348.04% |
Total Results |
$883,057,159 |
$1,406,343,008 |
59.26% |
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In FY 2003, EBSA closed 4,253 civil investigations, with 2,939 (69.10%)
resulting in monetary results for plans or other corrective action. Although the
number of cases actually dropped because of improved targeting and more
resource-intensive investigations, the proportion of investigations closed “with
results” increased by 18% over FY 2002.
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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 instituted. In FY 2003, 291 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 2003, litigation was filed
in 108 civil cases.(1)
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Civil Investigation Statistics
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FY
2002
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FY
2003
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Change
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Civil Investigations Closed |
4,925 |
4,253 |
-13.64% |
Civil Investigations Closed with Results |
2,877 |
2,939 |
2.16% |
% Civil Investigations Closed with Results |
58.42% |
69.10% |
18.28% |
Civil Cases Referred for Litigation |
241 |
291 |
20.75% |
Civil Cases With Litigation Filed |
104 |
108 |
3.85% |
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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.
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In FY 2003, EBSA closed 175 criminal investigations. EBSA’s criminal
investigations, as well as its participation in criminal investigations with
other law enforcement agencies, led to the indictment of 137 individuals –
including plan officials, corporate officers, and service providers – for
offenses related to employee benefit plans. The agency also achieved a more than
16% increase in the number of criminal investigations closed with either a
guilty plea or with a criminal conviction.
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Criminal
Investigation Statistics
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FY
2002
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FY
2003
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Change
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Criminal Investigations Closed |
154 |
175 |
13.64% |
Number of Individuals Indicted |
134 |
137 |
2.24% |
Criminal Investigations Closed with Guilty Pleas or
Convictions |
49 |
57 |
16.33% |
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EBSA’s Voluntary Fiduciary Correction Program (VFCP) encourages
self-correction of certain violations of ERISA. Improved in November of 2002,
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. The
Program presents significant incentives for fiduciaries and others to correct
certain ERISA violations.
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In FY 2003, EBSA received 240 applications for the VFCP – a 336.36%
increase over FY 2002. This enormous increase reflects the extent to which the
regulated community has embraced the program since it was improved in 2002. In
FY 2003, applicants restored more than $8.7 million in assets to employee
benefit plans through this program.
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VFCP
Statistics
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FY
2002
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FY
2003
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Change
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Program Applications Received
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55
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240
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336.36%
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Monetary Results of Approved Applications
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$1,949,898
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$8,736,232
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348.04%
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When a worker experiences a problem with an employee benefit plan, EBSA has
proven effective in resolving requests for assistance. In FY 2003, EBSA handled
over 173,000 inquiries and recovered nearly $83 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).
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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
2003, 1,362 investigations were opened as a result of referrals from inquiries.
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Inquiry
Statistics
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FY
2002
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FY
2003
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Change
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Total Inquiries
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184,851
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173,598
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-6.09%
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Monetary Benefit Recoveries from Inquiries
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$48,684,859
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$82,906,277
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70.29%
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Investigations Opened from Inquiry Referrals
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1,347
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1,362
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1.11%
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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 2003, EBSA conducted 2,079 outreach events – an increase of more than 29%
over FY 2002.
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Outreach, Education and Assistance Statistics
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FY
2002
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FY
2003
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Change
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Dislocated Worker Rapid Response Sessions
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858
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695
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-18.99%
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Congressional Briefings
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78
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215
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175.64%
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Compliance Assistance Activities
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257
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458
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78.21%
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Other Participant Assistance/Public Awareness |
417 |
711 |
70.50% |
Total Outreach Events
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1,610 |
2,079 |
29.13% |
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EBSA cases referred to the Solicitor’s
office for litigation are often resolved, with monetary payments, short
of litigation.
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