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Pension watchdog a habitual snoozer

Date Posted: March 30 2007

Report: Labor Dept's. Pension enforcement still lacking

WASHINGTON (PAI) - The Department of Labor agency that enforces the law covering workers' pension plans has holes in its enforcement, regularly loses investigators to the private sector and does not coordinate well with other federal financial regulators that oversee the same companies, a new report says.

The early-March report, by the nonpartisan Government Accountability Office - the prime independent auditor of federal programs - adds DOL's Employee Benefits Security Administration (EBSA) has improved its enforcement in the last five years, but not enough.

The Government Accountability Office found:

  • EBSA "is not positioned to focus its resources on key areas of noncompliance." In other words, Bush's Labor Department lacks both goals and data to judge how many firms are obeying federal law and adequately funding pension plans for their workers.
  • EBSA has only 385 investigators, many with less than three years' experience, to oversee 730,000 private pension plans.
  • Other financially oriented federal agencies… have "routine compliance programs" to unmask problems and "identify emerging trends that may warrant enforcement," the report added. Those agencies also reach out to other information sources. And those agencies routinely look at corporations' books and financial records to spot flaws, trends or both, GAO said. EBSA does not.
  • The report says the pension watchdog is more inclined to react to problems, rather than be proactive. "EBSA does not conduct routine compliance examinations and broad, ongoing risk assessments to focus its enforcement efforts, like other agencies (do)," the report said.