DOL Investigations

[Guest bobolink]

Happy May! The DOL has initiated a broad based investigation of a pension plan. The request asks for information and documentation since 2005. I have a different investigation initiated in 2008 that also asked for information and documentation since 2005. I can't find any rules governing the time scope of a DOL investigation. Any experience, thoughts or ideas? Thanks.

[Belgarath]

We've recently had a couple of DOL audits on plans - one where the Trustees took a lot of money out of the plan and apparently didn't pay it out to the participants - (fortunately not until a couple of years after they terminated services with us!) and another where we never did know what the reason was - could have been random for all we know. They wanted information going back as far as 2002, as I recall. That was a lot of fun, since they want it all organized into the various categories they specify. The temptation is strong to just copy the whole file, send it to them, and let them organize it themselves! However, better not to "poke the bear" so we restrained our baser instincts.

[Kevin C]

It could be worse. We had a client get a DOL audit in 2007. They asked for complete records from 1/1/2002 forward.

I handled a DOL audit a few years ago for a plan where we did not do the plan work. The client had trouble getting the requested information from the prior service providers. When I explained the situation to the agent, he subpoenaed the prior service providers to get the information he needed.

[Guest Sieve]

My undertstanding is that the DOL is bound to a 3-year statute of limitations for audits, based on the due date for filing the Form 5500, or the filing date, whichever is later. Otherwise, they need an agreement to waive the statute. But a civil action brought by the DOL uses a 6-year statute.

So, a 2005 calendar-year Form 5500, on extension, could be audited through 10/2009 without a waiver of the statute.

Criminal investifations have a longer statute of limitations, depending on the crime alleged.

[A Shot in the Dark]

A few years ago, we had a "broad based" audit by the DOL on an ESOP. As Sieve indicated, there is a statue of limiations, however the auditor requested that we waive the statute and asked for records for a number of years.

After many discussions with ERISA counsel, the client agreed to the waiver and we supplied all of the records ( an in the spirit of cooperation motive). There were no "skeletons" sort of speak and we (including ERISA counsel and the client) thought everything was in order.

What I found interesting was after several weeks of audit and review, including interviews with the trustees, etc. we never really received a "closure letter". All we received was a one paragraph letter from the DOL stating that the DOL has received all of the requested information and documentation. And I received a phone call from the auditor that no futher action was contetmplated.

I/we have never heard from the DOL since then.