Retirement Security:

ERISA Targeting

HRD-93-34R: Published: Sep 30, 1993. Publicly Released: Sep 30, 1993.

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GAO reviewed the Department of Labor's enforcement of the Employee Retirement Income Security Act of 1974 (ERISA), focusing on the Pension and Welfare Benefit Administration's (PWBA) investigation of pension and welfare benefit plans' violations of ERISA fiduciary requirements. GAO found that PWBA: (1) could make computer targeting more effective and efficient by designing program thresholds to better identify plans that are likely to violate ERISA and analyzing computer targeting programs in combination with one another rather than individually; (2) could improve program testing and validation by randomly selecting plans for investigation and using a more appropriate formula to determine the minimum sample size; (3) has no evidence that the highest-ranking plans under investigation are more likely to violate ERISA; and (4) may be able to target plans and test programs more effectively by using multivariate analyses that consider all applicable characteristics of the plans.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: The Assistant Secretary, PWBA, should revise the way PWBA designs and tests computer targeting programs. At a minimum, it should randomly select plans for testing so that results can be projected and programs properly validated. It should establish program thresholds to identify all plans with a high probability of violating ERISA. It should also use an appropriate formula to set the sample size to minimize calendar and staff time spent on testing.

    Agency Affected: Department of Labor: Pension and Welfare Benefits Administration

    Status: Closed - Not Implemented

    Comments: Because this was a letter to an agency official below the Secretary, no official action is required. However, action is required on recommendations in GAO's August 8, 1994, report, which reiterated three of the recommendations in GAO's September 30, 1993, letter. GAO will follow up on the August 8 report.

    Recommendation: The Assistant Secretary, PWBA, should test the feasibility of using multivariate analysis to target plans for investigation.

    Agency Affected: Department of Labor: Pension and Welfare Benefits Administration

    Status: Closed - Not Implemented

    Comments: Because this was a letter to an agency official below the Secretary, no official action is required. However, action is required on recommendations in GAO's August 8, 1994, report, which reiterated three of the recommendations in GAO's September 30, 1993, letter. GAO will follow up on the August 8 report.

    Recommendation: If data is not readily available on investigation conversions and all applicable characteristics needed to do multivariate analysis, the Assistant Secretary, PWBA, should begin systematically gathering such data.

    Agency Affected: Department of Labor: Pension and Welfare Benefits Administration

    Status: Closed - Not Implemented

    Comments: Because this was a letter to an agency official below the Secretary, no official action is required. However, action is required on recommendations in GAO's Agust 8, 1994, report, which reiterated three of the recommendations in GAO's September 30, 1993, letter. GAO will follow up on the August 8 report.

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