DOL cracking down on 401(k) fraud

The Department of Labor is cracking down on employers who fail to deposit workers’ retirement or health plan contributions and using the money for their own purposes.

The Contributory Plans Criminal Project is DOL’s first national project aimed at eliminating fraud from employee benefit plans governed by the Employee Retirement Income Security Act.

"Employees sacrificed wages to provide important benefits for themselves and their families," says Secretary of Labor Hilda L. Solis. "These enforcement actions underscore the Labor Department’s commitment to ensure that these workers’ contributions are protected and available to pay future benefits."

DOL has also issued "10 Warning Signs That Your 401(k) Contributions are Being Misused" to provide workers with useful information to identify possible problems with their benefit programs, such as unusually high administrative expenses or improper business dealings with parties who manage and invest plan money.

Last year, DOL closed 1,042 civil investigations, 910 with corrected violations, and recouped nearly $18 million.

Barney is the editor of Money Management Executive, a SourceMedia publication. Follow EBN on: Twitter | Facebook | LinkedIn | Podcasts