Pension and Welfare Benefits Administration; Strategic
Enforcement Plan [Notices] [04/06/2000]
Pension and Welfare Benefits Administration; Strategic
Enforcement Plan [04/06/2000]
Volume 65, Number 67, Page 18207-18212
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Part VIII
Department of Labor
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Pension and Welfare Benefits Administration
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Strategic Enforcement Plan; Notice
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DEPARTMENT OF LABOR
Pension and Welfare Benefits Administration
Pension and Welfare Benefits Administration; Strategic
Enforcement Plan
AGENCY: Pension and Welfare Benefits Administration, Department of
Labor.
ACTION: Notice.
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SUMMARY: The Pension and Welfare Benefits Administration (PWBA) is
publishing this Strategic Enforcement Plan (StEP) for the purposes of
informing the public of its current goals, priorities, and methods, and
promoting compliance with Title I of the Employee Retirement Income
Security Act of 1974, as amended (ERISA). The primary purpose of the
StEP is to establish a general framework through which PWBA's
enforcement resources may be efficiently and effectively focused to
achieve the agency's policy and operational objectives.
EFFECTIVE DATE: This Strategic Enforcement Plan is effective on April
6, 2000.
FOR FURTHER INFORMATION CONTACT: Virginia C. Smith, Director of
Enforcement, (202) 219-8840 (this is not a toll-free number).
SUPPLEMENTARY INFORMATION:
I. Statutory Framework
The Employee Retirement Income Security Act (ERISA), enacted in
1974, prescribes uniform minimum standards to ensure that employee
benefit plans are fair and financially sound and provide workers with
the benefits promised by their employers. The law covers most private
sector employee benefit plans that are voluntarily established and
maintained by an employer, an employee organization, or some
combination of these. Pension plans--a major type of employee benefit
plan--provide retirement income or defer income until the employee
stops working or sometime later. Other employee benefit plans are
called welfare plans; these provide health, disability, and other
similar benefits.
Three federal agencies play a role in administering ERISA. The
Internal Revenue Service oversees the tax code provisions of the law.
The Pension Benefit Guaranty Corporation (PBGC) administers the
federally-sponsored insurance provisions covering defined benefit
pension plans. The third agency, the Pension and Welfare Benefits
Administration within the Department of Labor, has principal
responsibility for administering Title I of ERISA. ERISA confers
substantial law enforcement responsibilities on PWBA, giving PWBA the
authority to conduct investigations and to seek appropriate remedies to
correct violations of the law, including litigation where necessary.
Title I of ERISA sets forth standards and rules governing the
conduct of plan fiduciaries. In general, people who exercise
discretionary authority or manage a plan or have authority to dispose
of its assets are ``fiduciaries'' for purposes of Title I of ERISA.
Fiduciaries are required, among other things, to discharge their duties
solely in the interest of plan participants and beneficiaries and for
the exclusive purpose of providing benefits and defraying reasonable
expenses of administering the plan. In discharging their duties,
fiduciaries must act prudently and in accordance with the documents
governing the plan, to the extent such documents are consistent with
ERISA. Certain transactions between an employee benefit plan and
``parties in interest,'' which include the employer and others who may
be in a position to exercise improper influence over the plan, are
prohibited by ERISA.
II. Organization of PWBA'S Enforcement Program
PWBA enforces ERISA by conducting investigations through its ten
regional offices and five district offices located in major cities
around the country.\1\ These field offices conduct investigations to
gather information and evaluate compliance with ERISA's civil law
requirements as well as criminal law provisions relating to employee
benefit plans. Except in those cases involving national priorities,
projects, enforcement policy, or other designated matters, the field
offices generally exercise broad discretion in determining when
investigations are to be opened and which entities or individuals are
to be investigated. The field offices conduct their investigations in
accordance with established enforcement procedures.
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\1\ PWBA regional offices are located in Boston, New York,
Philadelphia, Atlanta, Cincinnati, Chicago, Dallas, Kansas City, San
Francisco, and Los Angeles. PWBA district offices are located in
Washington, D.C., Miami, Detroit, St. Louis, and Seattle.
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Each PWBA field office coordinates civil investigations and case
referrals with its local Regional Solicitor's Office (RSOL) or with the
Plan Benefits Security Division (PBSD) of the Solicitor's Office in
Washington, DC, which are responsible for bringing civil lawsuits on
behalf of the agency.
PWBA's Office of Enforcement (OE), located in Washington, DC,
communicates national enforcement policies, priorities, and procedures
to PWBA's field offices. OE is responsible for operational review and
oversight, enforcement policy direction, program coordination, and
technical assistance.
III. Purpose and Scope of the Strategic Enforcement Plan
During fiscal year 1999, PWBA had fewer than 400 investigators, the
front-line staff who identify and investigate civil and criminal
violations relating to employee benefit plans. With over 700,000
pension plans and 4.5 million welfare plans, PWBA must use its
investigative staff effectively to protect the more than $4.3 trillion
in assets contained in private employee benefit plans. For this reason,
a 1995 report by the Brookings Institution referred to PWBA as probably
the most highly leveraged agency in the U.S. government.\2\
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\2\ ``Cutting Government,'' A Report of the Brookings
Institution's Center for Public Management, May 22, 1995.
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The primary purpose of PWBA's Strategic Enforcement Plan (StEP) is
to establish a general framework through which PWBA's enforcement
resources may be efficiently and effectively focused to achieve the
agency's policy and operational objectives. The StEP identifies and
describes PWBA's enforcement priorities; the planned allocation of
enforcement resources to carry out these priorities is established
yearly in an operational plan. PWBA intends to reference this StEP when
it exercises its enforcement discretion; however, the StEP does not
create or confer any rights, duties, obligations, or defenses, implied
or otherwise, on any person or entity.
Because of the substantial demands that are placed on PWBA's
limited investigative resources, the StEP establishes broad policy
criteria to ensure an appropriate balance of priorities while
maintaining the highest possible standard of operational efficiency.
Within the framework of these criteria, each region may exercise
discretion in allocating investigative resources, provided appropriate
resources are allocated to implement national projects and other
designated items, such as emerging issues and high profile
investigations which warrant special attention. National investigative
priorities and projects are identified and developed with participation
of field office management.
IV. Enforcement Strategy
In fiscal year 1997, the Secretary of Labor established three
strategic goals
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for the Department of Labor: A Prepared Workforce; A Secure Workforce;
and Quality Workplaces. PWBA's enforcement strategy is designed to
support the strategic goal of a secure workforce by deterring and
correcting violations of ERISA and related statutes. PWBA supports the
goal of a secure workforce by other means as well, such as the
development of the ERISA Filing Acceptance System for Form 5500 annual
reports, educating the pension and welfare benefits community, and
providing individual assistance to participants.
A. Targeting
The term ``targeting'' refers to the PWBA process whereby specific
individuals or entities are identified for investigation because of
some indication that an ERISA violation may have occurred or may be
about to occur. For example, the targeting process could be as simple
as opening a single investigation based on information received from a
plan participant whose benefits are past due or it could involve
opening hundreds of cases based on the computer-generated results of
Form 5500 review and analysis.
Because there are over five million private employee benefit plans
under PWBA's jurisdiction, targeting is essential to effectively use
PWBA's limited investigative resources. Targeting focuses PWBA
resources on those situations, issues, individuals, or entities where
the most serious potential for ERISA violations is likely to exist.
PWBA strives to establish targeting methods that focus
investigative resources in areas that are most likely to uncover
abuses. Because evaluating ERISA violations usually involves applying
legal standards to complex factual scenarios, the challenge in
constructing effective targeting methods is to identify factors that
can be used to pinpoint specific plans (e.g., those with delinquent
forwarding of employee contributions), individuals, and other entities
in violation of the law.
Once the type of conduct and the individual or entity is
identified, the field office must decide whether to formally open an
investigation. This determination may be based on a number of
considerations such as the egregiousness of the conduct, the amount of
money or property at risk, or the number of participants potentially
affected. Although the field offices are generally responsible for
identifying potential investigative targets and determining which cases
are to be opened, in certain cases these activities may be coordinated
with OE.
PWBA must apply its investigative resources in a manner that will
result in prompt and effective enforcement actions, and timely results.
OE and field office managers determine how cases are to be
investigated, evaluated, and resolved to achieve this goal. In some
cases field office managers must determine whether to pursue an issue
civilly, criminally, or both simultaneously. In addition, the
investigators are responsible for implementing investigative methods
designed to achieve timely monetary or injunctive relief, as
appropriate. In some cases, the most effective approach may require
referral to another state or federal agency because of the legal issues
involved. In determining which course of enforcement action to pursue
or which method to apply to prevent, redress, or punish illegal
behavior, PWBA will consider all available options and strive to follow
the best alternative available.
B. Protecting At-Risk Populations
Employee benefit plans provide income and services on which
individuals rely for their quality of life, often to a critical degree.
The financial security of an individual or a family may be jeopardized
if pension, health, or other benefits are not paid as promised. Medical
benefit plans provide not only for the physical well-being of
individuals, but often provide access to services which individuals
might not otherwise be able to afford.
PWBA seeks to identify situations and apply its enforcement
resources to protect those employee benefit plan participants and
beneficiaries whose security and livelihood are in the greatest danger
of being harmed as a result of ERISA violations. Such methods focus on
those situations where participants and beneficiaries are most
susceptible to actual loss of benefits, or where ``populations'' of
plan participants are potentially exposed to the greatest risk of
falling victim to unlawful conduct.
All of PWBA's field offices engage in outreach efforts which are
designed to assist potentially vulnerable populations such as
participants who might have otherwise lost coverage or benefits (e.g.,
employees whose benefits are affected by plant closings, or employers
who might be victimized by unscrupulous health care promoters) or plans
for which benefits are not federally insured, such as 401(k) plans.
These outreach efforts may involve speaking at conferences and seminars
sponsored by trade, professional, and educational groups or
participating in outreach and educational efforts in conjunction with
other federal or state agencies.\3\ Educating participants and
beneficiaries about their benefits, rights, and the availability of
PWBA's enforcement authority helps establish an environment where they
can help protect their own benefits through recognizing potential
problems or notifying PWBA in appropriate situations.
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\3\ In July 1995, PWBA launched its national pension education
campaign to inform and encourage people to make educated choices
about retirement planning, especially small business owners, young
people, low wage workers, women, and minorities. This information
campaign was supplemented in December 1998 by PWBA's national health
benefits education campaign, which is designed to help people
understand their medical benefits when they experience changes in
life and work.
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Although PWBA seeks to protect the benefits of plan participants
and beneficiaries that are at actual risk of loss, in some cases an
investigation will be conducted even where benefits do not appear to be
at risk. For example, a health care service provider may pay a plan
fiduciary a ``kickback'' in exchange for the fiduciary's selecting that
entity over another. Enforcement action is warranted in such cases to
ensure the integrity of the system even though the plan participants
and beneficiaries incurred no actual harm. Situations involving self-
dealing, conflicts of interest, and gross imprudence are examples of
other types of violations that may warrant investigation even in the
absence of demonstrated harm to plan participants.
C. Deterring Violations
Almost all enforcement programs hope to deter people from violating
the law. PWBA seeks to deter illegal conduct through the continuing
effectiveness of its civil and criminal enforcement efforts. PWBA
actively publicizes its litigation, which has proven useful in
encouraging voluntary compliance by others.
While PWBA seeks to recover losses incurred by participants, it
also seeks to maintain the financial and operational integrity of the
private employee benefit plan system. Doing so has sometimes involved
conducting investigations that address potentially abusive practices
which may not involve actual losses to the plans or participants.\4\
Because such projects are effective at changing certain types of
behavior, this approach will
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continue to be used by PWBA under selected circumstances.
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\4\ An example of such a project was the enforcement initiative
relating to corporate governance issues, known as the Proxy Project.
While the Proxy Project did not result in any monetary recoveries on
behalf of plans, it was enormously successful in educating the ERISA
community regarding their legal responsibilities under ERISA with
respect to the voting of proxies.
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PWBA also has responsibilities for enforcing the criminal
provisions contained in ERISA and violations under Title 18 of the U.S.
Code which affect employee benefit plans. In pursuing criminal
violations, PWBA staff work with the local U.S. Attorneys' Offices, as
well as other law enforcement agencies, to support effective
prosecution and sentencing. After a conviction is obtained, PWBA is
diligent in ensuring that the statutory bar provided for in section 411
of ERISA is applied. This section of ERISA generally prohibits any
person who has been convicted or imprisoned for any of the enumerated
criminal offenses from serving in virtually any capacity relating to an
employee benefit plan for 13 years after conviction or completion of
imprisonment.
On March 15, 2000, PWBA adopted its Voluntary Fiduciary Correction
Program, which encourages the voluntary correction of certain
violations of Title I of ERISA. The program allows plan officials to
identify and fully correct thirteen transactions, such as prohibited
purchases and sales, improper loans, delinquent participant
contributions, and improper plan expenses. If an eligible party
documents the acceptable correction of a transaction, PWBA will issue a
no-action letter, and will not initiate a civil investigation under
Title I of ERISA regarding the applicant's responsibility for any
transaction described in the no-action letter. PWBA expects this
program to facilitate corrections by plan officials who want to come
into compliance with the law with respect to their past practices, and
promote better compliance in the future.
V. Implementing the Enforcement Strategy
PWBA's enforcement strategy is implemented through the guidance in
this document, the StEP, and at a working level through the agency's
annual performance goals, developed by the field offices in
coordination with OE. The annual performance goals translate the
general policy guidance articulated in the StEP into practical
application.
A. Civil Investigations
PWBA's enforcement program is primarily carried out through civil
investigations. PWBA organizes its civil investigative program using
two main approaches: (i) national projects, which are investigative
projects that further more broadly established long-range national
investigative priorities, and (ii) regional projects which are
localized investigative projects undertaken by individual PWBA regional
offices.
1. National Investigative Priorities
PWBA establishes national investigative priorities to ensure that
its enforcement program focuses on the areas that are critical to the
well-being of employee benefit plans. Types of plans, benefits, or
other broad segments of the regulated employee benefit plan universe
are identified and designated for emphasis by PWBA's enforcement
program. These areas will generally be designated for emphasis over
several years. Each year, PWBA identifies specific national
investigative projects, within these national investigative priorities,
to which it will dedicate enforcement resources. These projects are
designed to identify and correct ERISA violations which PWBA believes
may be widespread or to focus on possible abusive practices that may
affect many plans.
There are three current national investigative priorities: plan
service providers, health care plans, and defined contribution pension
plans.
a. Plan Service Providers. The term ``plan service provider''
refers to any person or entity which provides a direct or indirect
service to an employee benefit plan for compensation. Third party
administrators, accountants, attorneys, and actuaries are plan service
providers. Plan service providers also include financial institutions
such as banks, trust companies, investment management companies and
insurance companies as well as others that manage or administer,
directly or indirectly, funds or property owned by employee benefit
plans.
Investigations of plan service providers offer the opportunity to
address abusive practices that may affect more than one plan, and by
focusing investigative resources on plan service providers, PWBA can
address violations involving many plans. Because such investigations
generally result in larger recoveries for more plans and more
participants, this approach provides a mechanism whereby PWBA can
leverage its resources and obtain the maximum impact for the benefit of
plan participants and beneficiaries.
When investigating plan service providers, PWBA generally focuses
on the abusive practices committed by the specific service providers
rather than the plans. For example, where a third party administrator
has systematically retained an undisclosed fee, generally the focus
will be on the third party administrator rather than the plan that
contracted for the services. Because the investigation of plan service
providers offers the opportunity to leverage available staffing, the
field offices are encouraged to allocate appropriate resources to the
targeting and investigation of these issues or entities.
b. Health Benefit Issues. The Department has estimated that there
are a total of 2.6 million ERISA-covered health plans, covering
approximately 122 million participants and beneficiaries. In recent
years several factors have combined to make the management and
administration of ERISA-covered health plans a matter of vital national
importance, including increased health care costs (due in part to
improved technology and accessibility); changes in the health care
delivery and funding systems; and the evolution of the legal standard
under which health plans and their service providers must operate. As
the cost of health care has increased, the methods for delivering that
care have changed. In general, the increase in health care costs is
regarded as a key factor in the move toward managed care which is
designed to control access to health care and its related costs.
PWBA seeks to ensure that plans and the benefits of their
participants and beneficiaries are protected. The application of
available remedies under ERISA is critical in those cases where federal
preemption leaves participants with no other effective statutory or
common law cause of action. PWBA seeks to apply the full extent of
ERISA's remedies and to promote a legal standard that will increase the
availability of appropriate remedies to protect plans and their
participants and beneficiaries.
Because of the critical importance of the health benefits area,
PWBA has in recent years applied substantial resources to addressing
abusive practices that violate ERISA, pursuing enforcement actions
involving multiple employer welfare arrangements (MEWAs), and insurers
and service providers who receive hidden discounts. PWBA's role in the
health care area has also expanded as a result of the enactment of new
legislation that includes regulatory and enforcement requirements to be
implemented by PWBA, including:
<bullet> The Health Insurance Portability and Accountability Act of
1996 (HIPAA), which amended ERISA to provide for, among other things,
improved portability and continuity of health insurance coverage
provided in connection with employment;
<bullet> The Newborns' and Mothers' Health Protection Act of 1996
(NMHPA), which amended ERISA to establish minimum
[[Page 18211]]
requirements for hospital stays relating to childbirth;
<bullet> The Mental Health Parity Act of 1996 (MHPA), which amended
ERISA to establish certain minimum requirements relating to mental
health coverage; and
<bullet> The Women's Health and Cancer Rights Act (WHCRA), which
amended ERISA to provide new protections for patients who elect breast
reconstruction in connection with a mastectomy.
In the wake of these and other legislative amendments to ERISA,
PWBA will continue to devote substantial enforcement resources to the
targeting and investigation of fiduciary issues relating to health
benefit issues.\5\
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\5\ In December 1999, PWBA created the Office of Health Plan
Standards and Compliance Assistance to develop regulations,
interpretive bulletins, opinions, forms, and rulings relating to
health care portability, non-discrimination requirements, and other
related health provisions.
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c. Defined Contribution Plans. There are two major types of pension
plans under ERISA. In a defined benefit plan, the plan sponsor makes
contributions to a fund and those contributions are intended to provide
a promised level of benefits upon retirement. The amount of benefits
paid is usually based upon a formula. With this type of plan the plan
sponsor is responsible for managing the assets in the fund to ensure
the amount is sufficient to pay benefits in the future. If the amount
of funding in the plan is not sufficient to pay future benefits the
plan sponsor is responsible for the short fall. These types of plans
are also covered by termination insurance issued by the PBGC.
In contrast, defined contribution plans are plans where the plan
sponsor and/or the participant makes contributions to an account and
the amount paid to the participant upon retirement is determined by the
amount of funds that have accumulated in the account. Participants in
defined contribution plans bear the risk of investment loss, whereas in
defined benefit plans that risk is borne primarily by the plan sponsor
or the PBGC and only secondarily by the participant, if on plan
termination the sponsor is bankrupt and PBGC insurance does not cover
the benefit. Because defined contribution plans are not covered by PBGC
insurance, if a plan experiences losses due to a fiduciary breach the
plan participants are directly affected and, unless the funds can be
recovered through enforcement or other legal actions, that loss will be
irrevocable.
In recent years there has been a tremendous growth of 401(k) type
of defined contribution plans in terms of the number of plans, number
of participants, and amount of assets in these type plans. This growth
and the related administrative and investment practices which have
developed to accommodate these plans warrant scrutiny to ensure the
safety of this large volume of assets.\6\ PWBA has identified defined
contribution plans as a national enforcement priority because the risk
of loss in such plans rests entirely on the plan participants.
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\6\ In July 1998, PWBA released A Look at 401(k) Plan Fees, a
19-page educational booklet, to help consumers understand the fees
and expenses associated with 401(k) plan accounts.
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2. National Projects
National projects are investigative projects focusing on a selected
issue or group of related issues which fall within the established
national enforcement priorities. Once an issue or group of issues has
been designated as a national project each PWBA field office generally
must give priority to conducting investigations and dedicating
appropriate resources to the project during the fiscal year. Although
national projects are intended to focus on issues of national scope and
significance, specific projects may on occasion address issues that are
not necessarily prevalent in all areas of the country and the
participation of only a selected group of PWBA field offices may be
required.
The issues selected for implementation as national projects are
determined (or reviewed, since an individual national project may
extend over more than one fiscal year) with the input of PWBA's field
offices in annual planning sessions. National projects may originate as
an expansion of a successful regional project or arise in connection
with field office investigations. For example, one national project
which has been ongoing for a number of years is the investigation of
multiple employer welfare arrangements (MEWAs).
Coordination and enforcement policy determinations for national
projects are generally directed through OE. Such direction is conducted
with substantial participation and opportunity to comment by the field
office managers. OE's involvement in national projects includes
monitoring and evaluating the project's progression and, where
appropriate, issuing procedural directives and technical guidance.
3. Regional Projects
Enforcement initiatives are also conducted as projects by
individual regions. Each year the field office managers submit their
project proposals to OE for review and approval. The subjects selected
for regional projects are generally topics that have been identified by
a particular region as constituting an enforcement issue that may be
unique or particularly problematic within its geographic jurisdiction.
Because the field staff may be able to identify potential issues
through their investigative activities, the regions have the unique
opportunity to observe industry practices first hand and select issues
for development as regional projects which may ultimately be
appropriate for adoption as national projects. Normally, an issue
selected as a regional project will be:
<bullet> Well-defined both in terms of scope and focus rather than
couched in terms of broad categories, such as ``small plan issues'';
<bullet> Identified in the context of a type of transaction or
industry practice; or
<bullet> An emerging concern or involving a legal position that is
precedential in nature.
In addition a regional project should be amenable to the
development of an effective targeting method so that an appropriate
number of subjects can be identified for investigation. As noted
previously, any number of targeting methods may be used.
Regional projects that satisfy these criteria provide a foundation
for identifying cutting-edge issues that may be found to involve
matters of national scope and importance. If subsequently selected as a
national project, the experience and insight gained at the field office
level will provide a substantive basis for guiding other field offices
in conducting similar investigations. Some regional projects address
practices that are more localized in their scope and impact. Because
the demographics of each region differ in the concentrations of various
types of plans and service providers, the same strategy is not optimal
for all offices.
B. Criminal Investigations
Section 506(b) of ERISA gives the Department responsibility and
authority to detect and investigate and refer, where appropriate,
criminal violations related to Title I of ERISA and other federal laws,
including the detection, investigation, and appropriate referrals of
related violations of the federal criminal code. The number of criminal
investigations and prosecutions pursued by PWBA has increased
substantially in recent years and it is expected the number of cases
and indictments will continue to grow. In particular, PWBA's role in
investigating criminal violations involving health care plans is
expected to grow with the recent addition of several new criminal
provisions relating to health care plans.
[[Page 18212]]
The prosecution of criminal acts relating to employee benefits
plans is a critical part of PWBA's enforcement program. PWBA is
committed to maintaining a strong criminal enforcement program by
conducting criminal investigations to detect violations that affect
employee benefit plans and to assist United States Attorneys and state
prosecuting attorneys in their prosecution of such cases. Each of the
PWBA field offices maintains on-going involvement in criminal
investigative activity.
The U.S. Criminal Code includes several provisions that
specifically address violations relating to ERISA-covered pension and
health plans. The three major criminal provisions applicable to both
pension and health plans are:
<bullet> Section 664, relating to theft or embezzlement from an
employee benefit plan;
<bullet> Section 1027, relating to false statements and concealment
of facts relating to documents required by ERISA; and
<bullet> Section 1954, relating to the offer, acceptance, or
solicitation to influence operations of an employee benefit plan.
The federal criminal code contains several other provisions that
have been applied in connection with criminal acts involving employee
benefit plans, such as the mail and wire fraud provisions (sections
1341 and 1343) and money laundering prohibitions (sections 1956 and
1957).
HIPAA created four new federal crimes specifically relating to
health care benefit programs. The four new provisions establish
criminal penalties relating to general health care fraud (section
1347); theft or embezzlement relating to health care (section 669);
false statements relating to health care (section 1035); and
obstruction of criminal investigations of health care offenses (section
1518). HIPAA also amended the federal criminal code sections relating
to money laundering and racketeering to address health care offenses.
Amendments to the criminal asset forfeiture provisions now establish a
process for restoring funds to ERISA-covered health plans.
Criminal cases are targeted in various ways, including systematic
methods (such as the analysis of computer data), information obtained
through a civil investigation, leads from individuals (such as plan
participants, plan officials, or informants), media sources, or
information obtained from other government agencies. The field offices
are encouraged to maintain effective working relationships with other
law enforcement agencies, such as the local U.S. Attorneys' offices,
the Federal Bureau of Investigation and the Office of the Inspector
General. PWBA maintains close contacts and coordinates with these and
other federal and state law enforcement agencies both in connection
with identifying potential investigative targets as well as in the
course of conducting investigations and pursuing prosecution, when
appropriate.
Once such leads have been identified and illegal conduct is
indicated or suspected, the field office managers are responsible for
determining whether an investigation should proceed criminally,
civilly, or both simultaneously. Because the same facts giving rise to
fiduciary violations in civil investigations may also give rise to
criminal violations, as a matter of course, PWBA determines whether
there are criminal issues to be pursued in connection with its civil
investigations. If such issues are believed to potentially exist, a
criminal investigation will be pursued and, as appropriate, the cases
will be coordinated with the appropriate U.S. Attorneys' offices to
seek indictments and convictions. Regardless of whether a criminal
investigation has been formally opened, evidence obtained by PWBA
indicating a potentially criminal act will be referred to the
appropriate U.S. Attorney's office.
VI. Measurement of Program Results
The Government Performance and Results Act of 1993 (GPRA) requires
the federal government to improve its performance and increase its
results. Under GPRA, all federal agencies are required to develop
multi-year strategic plans, prepare annual performance plans to
implement the strategic plans, and provide annual reports that compare
actual performance with stated goals. The StEP is designed to help
achieve GPRA's mandates by structuring PWBA's general policies in a
manner that will improve compliance results though the timely,
efficient, and effective operation of its enforcement program.
GPRA requires the establishment of measurable goals against which
performance can be evaluated. In the ERISA enforcement area the
measurement of performance in terms of improved compliance is
complicated by the absence of an established base level of non-
compliance. With over 700,000 pension plans and four million welfare
plans, no such baseline of compliance has been established. Like other
enforcement and regulatory agencies, PWBA has struggled with this issue
for some time. The establishment of pure baseline data regarding the
incidence of violations remains a major obstacle. Therefore, PWBA has
selected performance measures which highlight the most important
activities of the enforcement program, measures that challenge the
agency to improve the efficiency and effectiveness of its ongoing
programs as well as to address new and important initiatives.
PWBA has made significant progress assembling baseline data for
these performance measures which are included in the PWBA Strategic and
Annual Performance Plans. For example, the agency has established
baselines for measures such as the number of fiduciary investigations
closed where plan assets are restored and where prohibited transactions
have been corrected, closed investigations where plan assets have been
protected from mismanagement and risk of future loss is reduced, and
the ratio of closed civil cases with corrected violations to total
civil cases closed.
The PWBA Strategic Plan for FY 1997-FY 2002 is located on PWBA's
web site at www.dol.gov/pwba/gpra/main.htm. For a hard copy,
contact PWBA's Public Disclosure Room, at 202-219-8771.
Signed at Washington, D.C., this 3rd day of April, 2000.
Leslie B. Kramerich,
Acting Assistant Secretary, Pension and Welfare Benefits
Administration.
[FR Doc. 00-8504 Filed 4-5-00; 8:45 am]
BILLING CODE 4510-29-P
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