Overpayment of lump sum payment from DB plan

[katieinny]

I know this has come up before, but there seems to be disagreement about whether an employer can go after a participant to recover a money that was overpaid from the DB plan. In this case, the participant received a lump sum distribution. Several months later, the participant was notified that he received several thousand too much and the plan wants it back. In a perfect world, the participant would say "Oh, sure. Here you go." But nothing is that simple.

I've heard that it depends on if the money can be tracked to a specific account where it is still being held. Is that true?

Is there somewhere I can look to find out what the employer's, the plan's, and the participant's legal rights and obligations are?

[Guest mjb]

There is an article "Benefit plan Overpayments" in the Summer 2005 Benefits Law Journal at P 23. The article is focused on the legal remedies to recover excess payments by the Plan. However the article does not discuss the difficulty of recovering overpayments by requiring the tracing of the excess assets in the possession of the participant or beneficary which is required in an action in equity.

[david rigby]

Several references at this search location:

http://benefitslink.com/search/results.php...=&stopDate=