Page 12 - Investment Advisor July/August 2021

Beginnings

WASHINGTON WATCH

By Melanie Waddell

Labor’s EBSA Faces Immediate and

Long-Term Challenges: GAO

Finding missing participants will remain a long-term challenge and
may be an area that needs more investigative resources.

Eversheds Sutherland wrote in a recent
brief on the GAO report. Those areas of
focus relate to disclosure of plan informa-
tion to participants, reporting to relevant
agencies and fiduciary responsibilities.
“In providing effective oversight and
enforcement for the vast array of private
sector employee benefit plans and the
more that 154 million participants that
rely on them, EBSA’s job is enormous,”
said Phyllis Borzi, former head of EBSA
during the Obama administration.
“The report is balanced and compre-
he COVID-19 pandemic cre- ment efforts on “major cases,” GAO found. hensive and recognizes both the oppor-
ated “immediate and long- EBSA is charged with protecting the tunities and challenges that EBSA faces.
Tterm challenges” for the Labor rights of participants in employer-spon- I am encouraged, but not surprised, that
Department’s Employee Benefits sored benefit plans and enforcing Title the GAO found much to commend, but
Security Administration, which enforc- 1 of ERISA. As of fiscal year 2020, GAO the most important service that the GAO
es Title 1 of the Employee Retirement said, this included about 154 million Performance Audit report provides is in
Income Security Act, or ERISA — namely participants in 722,000 retirement plans its description of the impressive range of
court closures temporarily slowing crim- and 2.5 million health plans with com- strategies used by the agency to fulfill its
inal cases, as well as difficulty locating bined assets of over $10.7 trillion. protective mission. Most policymakers,
“missing participants” who’ve left behind The architect of the fiduciary prohib- taxpayers, and plan participants may not
retirement funds when exiting jobs. ited transaction exemption, EBSA shares know just how extensive and critical the
Those are just some of the findings responsibility for administering provi- work of this relatively small agency is,
in a new report by the Government sions within ERISA with the Internal but now, thanks to this GAO report, they
Accountability Office. Revenue Service and the Pension Benefit know and they can begin to appreciate
The GAO found that as virtual hearings Guaranty Corporation, or PBGC. EBSA’s efforts on their behalf,” Borzi said.
increased, litigation resumed, but find- The DOL arm generally focuses its The Eversheds attorneys stated that, DCStockPhotography/Shutterstock
ing missing participants would remain a enforcement efforts under ERISA in three “EBSA has always been a smaller federal
long-term challenge and may be an area broad categories of requirements that agency, with fewer than 1,000 employ-
that needs more investigative resources. apply to both retirement and health plans ees, and its full-time investigative staff
The EBSA has also refocused its enforce- and their service providers, attorneys at is quite modest relative to its regulated

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