David Levine of Groom Law Group will be covering this hot topic during his session at ASPPA Eastern Regional Conference to be held May 9-10 in Philadelphia PA.
The problem of plan participants who go missing after leaving their employers is a challenge for plan fiduciaries attempting to:
- comply with the required minimum distribution rules (RMD) of the Internal Revenue Code;
- cash out balances under $1,000 or $5,000, as applicable; or
- assist DB plan participants who reach retirement age and become entitled to a plan distribution.
Participants who cannot be located or will not respond to communications from the plan administrator may put the plan and its fiduciaries at risk of:
- plan disqualification for not following the terms of the plan; and/or
- breach of fiduciary duties under ERISA if the DOL determines that efforts to locate the participant are insufficient.
This issue came to the forefront when the Philadelphia Region of the Department of Labor began investigating DB plans with large terminated balances that were not in pay status and recovered more than $165 million that should have been paid to participants over a 10-month period. With those results, it is not surprising that the missing participant initiative has gone national.
Still, employers and plan fiduciaries striving to stay compliant want more guidance enumerating specific steps that constitute a prudent process and guidelines for what is considered a reasonable expense to charge to participants’ accounts for the efforts to locate them.
David has worked on many DOL investigations and will provide first-hand knowledge and insights on how to handle missing participant accounts.
The 2019 ASPPA Eastern Regional Conference in Philadelphia will also offer a variety of current topics, IRS and DOL sessions, ethics credit, and an “Ask the Experts” panel for which you can submit questions here or at the conference. Information about the conference is available here; registration information may be found here. Take advantage of the early bird discount – it ends today!
Maria Hurd is the Director of Retirement Plan Audit Services at Belfint, Lyons & Shuman, P.A., in Wilmington, DE.
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