1. Purpose. The purpose of this section is to provide guidance on health investigations, which includes plan-level health investigations and health plan service provider investigations.
  2. Statutory Requirements. The Employee Retirement Income Security Act (ERISA) gives the Secretary direct responsibility and authority to investigate violations of Title I of ERISA with respect to health plans. Health investigations may include a review of all applicable ERISA provisions including: (1) reporting and disclosure provisions under Part 1; (2) the fiduciary provisions under Part 4; (3) the benefit claims procedure regulations under Part 5; and (4) group health plan requirements under Parts 6 and 7 relating to all applicable health laws including:
    1. Consolidated Omnibus Budget Reconciliation Act (COBRA);
    2. Health Insurance Portability and Accountability Act (HIPAA);
    3. Mental Health Parity Act (MHPA);
    4. Mental Health Parity and Addiction Equity Act (MHPAEA);
    5. Women’s Health and Cancer Rights Act (WHCRA);
    6. Newborns’ and Mothers’ Health Protection Act (Newborns’ Act);
    7. Genetic Information Nondiscrimination Act (GINA);
    8. Michelle’s Law;
    9. Children’s Health Insurance Program Reauthorization Act (CHIPRA);
    10. Patient Protection and Affordable Care Act (Affordable Care Act or ACA);
    11. No Suprises Act (NSA); and
    12. Consolidated Appropriations Act, 2021 (CAA).
  3. Elements of ERISA Violation in Health Investigations. The following are basic elements of ERISA health violations, and not an all-inclusive list of elements:
    1. Part 7 Violations. If an enforcement action raises issues under the shared provisions of Part 7, it must reflect interpretations of the laws cleared by the Departments of Labor, Treasury, and Health and Human Services, as appropriate.
      1. The Part 7 provisions of Title I of ERISA cover the health plan(s) involved.
      2. The plan provisions or practices did not comply with the requirements under Part 7. Sufficient evidence establishes the health plan’s non-compliance with one or more statutory and regulatory provisions of Part 7.
    2. ERISA requires group health plans to:
      1. Provide participants with plan information, including important information about plan features and funding;
      2. Provide fiduciary responsibilities for those who manage and control plan assets;
      3. Establish a grievance and appeals process for participants to get benefits from their plans;
      4. Give participants notice of their right to sue for benefits and breaches of fiduciary duty; and
      5. Include rules relating to plan eligibility and coverage requirements.
  4. Plan-level Health Investigations. Regional Offices (ROs) conduct plan-level investigations of fully and self-insured group health plans to ensure compliance with health plan requirements under Title I of ERISA and to pursue widespread compliance opportunities when appropriate. In addition to Part 7 of Title I, these cases will also examine compliance with other ERISA provisions such as claims administration, failure to provide promised benefits, reasonable administrative fees, potential prohibited transactions, and other relevant issues.

  5. Service Provider Investigations. Generally, any service provider that exercises discretionary authority or discretionary control respecting the management or administration of an ERISA-covered health plan is a fiduciary. Many self-insured and most fully insured plans frequently include a health insurance issuer that exercises discretion or control over benefit claims decisions.

    Issuers offering health insurance coverage in connection with group health plans are also subject to Part 7 provisions through parallel state and federal laws. States maintain primary enforcement authority over health insurance issuers regarding these rules.

    Service provider investigations typically require an investigation of systemic ERISA violations to ensure service providers servicing ERISA-covered group health plans comply with plan documents and pay health benefits according to plan terms and applicable claims processing regulations. These cases focus on procedural, substantive, and disclosure violations related to the denial of promised health benefits. Though service provider cases may involve the same investigative issues as plan-level cases, they are generally more complex due to the large number of transactions involved (e.g., plan-wide patterns of claim processing errors).

  6. Global Compliance. In the health insurance industry, it is common for issuers or other service providers to issue standardized plan documents and other material to ERISA plan clients. To leverage its resources, EBSA identifies service providers who provide non-compliant health insurance policies or standardized plan documents and pursues global corrections, which affect all plans governed by the non-compliant policies or plan documents.

  7. Case Development. Enforcement strategies, annual operating plans, and National Office (NO) policy statements provide direction to identify areas of potential non-compliance and may emphasize the review and investigation of certain types of health investigations or issues. ROs should consider factors such as local economic conditions, geographical coverage within an RO’s jurisdiction, and specialized plan types.

    Sources for potential health investigations include:

    1. Computer generated compilations of selected employee health benefit plans or service providers derived from reports filed with EBSA;
    2. Information derived from detailed review and analysis of annual reports, supporting financial statements, schedules, exemption application files, ERISA Section 502 complaints, and other internal EBSA sources;
    3. Information concerning employee health benefit plans or service providers derived from other governmental agencies such as HHS and state insurance agencies;
    4. Information concerning employee health benefit plans or service providers derived from non-governmental sources such as newspapers, industry journals, and industry magazines;
    5. Information concerning employee health benefit plans or service providers derived from knowledgeable parties such as patient advocacy groups or private litigation;
    6. Complaints from participants, beneficiaries, fiduciaries, informants, or other sources in the community. Allegations of acts against a participant or beneficiary for exercising any right to which they are entitled under the provisions of an employee benefit plan, or interfering with the attainment of any right to which the participant may become entitled, should be handled as described in the EM section on Participant Rights; and
    7. Compilations of selected employee health benefit plans or service providers derived by using combinations of the sources.
  8. Case Opening.
    1. Consistent with National and Regional priorities, the RO will open cases when:
      1. The RO acquires information indicating a potential ERISA violation; or
      2. The NO directs it.
    2. ROs will open health plan investigations and health service provider investigations as a Program 50, unless it qualifies for opening under a Program 43 or 47. Information on these Program numbers is described below.
      1. ROs will open a Program 43 when the issues involve a welfare plan (other than a health plan) or participant rights. See the EM section on Participant Rights for additional information.
      2. ROs will open a Program 47 when the issues involve a prohibited person. See the EM section on Prohibited Persons for additional information.
    3. The case opening should briefly describe the reasons for opening the case, any materials reviewed before opening the case, and the dates of such review. The predication section of the case opening form will include:
      1. The pertinent facts that form the basis for opening an investigation,
      2. The nature of the complaint or other information received,
      3. Whether a service provider is involved and if so, the identification of the service provider(s),
      4. The ERISA-related issues raised by the complaint or information,
      5. The specific ERISA sections potentially violated, and
      6. The results of the global search of EBSA’s indices.
  9. Planning the Investigation.

    1. Written Investigative Plan. At the RD’s discretion, prepare investigative plans for cases in the form of a memorandum to the supervisor. A written investigative plan can help supervisors and Investigators/Auditors use limited resources productively. See Figure 1 for the suggested format for preparing the investigative plan.

      Further, when working complex matters that are categorized as Major Cases, ROs should capture substantive case characteristics and track and document the development of case progress, as appropriate.

    2. Supervisory Review. The supervisor will review the investigative plan, make any necessary changes, and indicate the date of approval of the original investigative plan. After approval of the original plan and notification to Investigator/Auditor, the investigative plan becomes part of the file.
    3. Updating the Investigative Plan. Whenever the Investigator/Auditor or the supervisor concludes a need for a major change in the original investigative plan, the Investigator/Auditor should prepare a written update of the investigative plan. As appropriate, the supervisor will review and approve the updated investigative plan. See Figure 2 for the suggested format in updating the investigative plan.
  10. Disclosure of Basis of Investigation. EBSA generally does not reveal the basis or source of an open investigation.
  11. Investigation of Possible Criminal Violations. Follow the procedures set forth in the EM section on the Criminal Investigations Program when there are possible criminal violations of ERISA Sections 411, 501, 511, and related sections of Title 18 of the U.S. Code.
    1. Dual Responsibility. If a criminal investigation is appropriate, ROs will open a separate Program 52 case to investigate the possible criminal violations. The RD must decide whether to investigate both cases simultaneously or sequentially. Criteria to assist in making this decision are set forth in the EM section on the Criminal Investigations Program.
    2. Postponement or Delay Requests. Federal, state, or local governmental agencies may request that EBSA postpone or delay a civil ERISA investigation or witness interviews/testimony. The RO should consider such requests after receiving a written request or an oral request confirmed in a letter to the requesting agency by the RD, stating the reasons why a postponement or delay is appropriate and the length of the anticipated delay. The RO may consult with OE before making any EBSA decision or response regarding the request.
  12. Prohibited Persons. If the investigation discloses possible violations of ERISA Section 411, ROs will open a Program 47 case. Follow the procedures for a Program 47 case in the EM section on Prohibited Persons.
  13. Apparent Violations of Participant Rights. If the investigation discloses possible ERISA Section 510 violations involving acts against a participant or beneficiary for exercising any right to which they are entitled under the provisions of an employee benefit plan, or interfering with the attainment of any right to which the participant may become entitled, the RO should immediately open a Program 43 case. Follow the procedures for a Program 43 case in the EM section on Participant Rights.

  14. Investigative Activity. Health investigations should include a compliance review with all applicable ERISA provisions. The compliance review includes the following ERISA provisions:

    1. Part 1 – Reporting and Disclosure;
    2. Part 4 – Fiduciary Responsibility;
    3. Part 5 – Claims Procedures (Section 503);
    4. Part 6 - Continuation Coverage and Additional Standards for Group Health Plans; and
    5. Part 7 – Group Health Plan Requirements.

    Generally, the Investigator/Auditors should evaluate health plan/benefit package options offered for Part 7 compliance that includes an operational review of claims data, claims listings and/or claims.

  15. Document Request Letters and Subpoenas. After case opening, the Investigator/Auditor may use a document request letter to request information beyond what is necessary to support information filed with the Secretary under Title I of ERISA. The document request letter requests the production of existing documents, not the creation of documents.

    Letters may be sent to the health plan, plan sponsor, and health plan service providers, including but not limited to health insurance issuers and third-party administrators. The Investigator/Auditor may also send letters to the Plan or health insurance issuer requesting a comparative analysis demonstrating compliance with MHPAEA’s requirements pertaining to non-quantitative treatment limitations and related information required by the CAA.

    Figure 3 is an example of a health plan document request letter. The information requested for a particular investigation may vary from this example depending on the facts and circumstances of the investigation.

    Depending on the facts and circumstances, the Investigator/Auditor may send a subpoena in conjunction with or instead of a document request letter. In consultation with SOL and before a subpoena is issued, EBSA will request the minimum information necessary to accomplish its investigative objectives. See EM section on Subpoenas for more information.

    Subsequent document requests or subpoenas may be necessary.

  16. Health Oversight Authority. HIPAA privacy regulations, collectively known as the “Privacy Rule,” set forth several “permitted uses,” “disclosures,” or “standards” which allow covered entities to disclose protected health information (PHI) without patient authorization. The Privacy Rule’s “health oversight” standard enables EBSA to obtain PHI from plans, their service providers, and physicians as is necessary to ensure compliance with ERISA. EBSA is a health oversight agency.

    ROs must follow special procedures when ROs request and receive PHI and information containing personally identifiable information (PII). ROs should coordinate with OE and PBSD or RSOL when requesting PHI to ensure proper procedures are followed. See EM section on Collection and Preservation of Evidence for more information about PHI.

  17. No ERISA Violations Found. When the investigation does not identify any ERISA violation(s), the Investigator/Auditor will prepare a Closed ROI and a closing letter to be sent to plan officials. The RD will approve and sign all closing letters prior to issuance.

    For further guidance on Voluntary Compliance letters closing letters, and Reports of Investigation, see the EM section on Voluntary Compliance Guidelines.

  18. Technical Advice. When the RO needs technical advice concerning the existence of actionable ERISA violations, appropriate remedial procedures including voluntary compliance, or similar matters, ROs will contact OE or OFA for assistance.
  19. ERISA Violations and Voluntary Compliance (VC). When the investigation identifies ERISA violations, the RD will determine, in accordance with EBSA policy, whether to pursue corrective action through VC. For guidance on pursuing voluntary compliance and issuing a VC notice letter, see the EM section on Voluntary Compliance Guidelines.
  20. VC Notice Letters and Reports of Investigation for Voluntary Compliance Cases.
    1. The Investigator/Auditor should prepare a VC notice letter (see the EM section on Voluntary Compliance Guidelines) and statute of limitations matrix for supervisory and RD review.
      1. If the case involves numerous or complex issues or the basis for the asserted violations is not apparent from the VC notice letter alone, the RD may require the Investigator/Auditor to provide supporting workpapers (see the EM section on Collection and Preservation of Evidence).
      2. The RD may also require the Investigator/Auditor to prepare a detailed memorandum explaining all the issues and citing supporting facts or a Closed ROI or Action ROI (see paragraph 21 below for information about Action ROIs).
    2. RDs will approve and sign all VC notice letters and closing letters prior to issuance. Copies of all approved and dated VC notice letters and closing letters sent to plan officials or other related parties become part of the case file and available to OE and OFA. The case and program number should be noted on all VC notice and closing letters.
    3. In voluntary compliance cases in which full compliance is achieved, or if partial or no compliance is achieved but the case will not be referred for litigation, the Investigator/Auditor will prepare a Closed ROI in the appropriate format (see Form 203h (Figure 4)).
    4. If an Action ROI has already been prepared, the Investigator/Auditor may prepare a supplemental memorandum to reflect the outcome of the voluntary compliance process, rather than preparing an additional Closed ROI.
    5. All 502(l) and 502(i) civil penalty issues must be resolved before a case may be closed. The outcome of the penalty issues must be addressed in the Closed ROI or supplemental memorandum.
    6. In a voluntary compliance case where there is only partial or no compliance, and the case is appropriate for litigation referral, the Investigator/Auditor will prepare an Action ROI and accompanying documents in accordance with paragraph 21 below.

  21. Action Reports of Investigation. The Investigator/Auditor will prepare an Action ROI together with exhibits and a cover memorandum whenever: (1) the RD determines that there are established violation(s) of Title I of ERISA that remain uncorrected, and (2) the litigation referral serves enforcement priorities.

    The RO must send the approved Action ROI, cover memorandum, and exhibits to PBSD and RSOL. A copy of the approved and dated Action ROI, cover memorandum, and exhibits must be maintained in the case file.

    1. Preparation of Action ROIs. An Action ROI should describe the facts obtained during the investigation and necessary to show each element of the alleged violations. The ROI should also set forth evidence, if any, that contradicts or does not support the elements of the violations. In addition, it should contain facts regarding each element of any applicable statutory or administrative exemption. The ROI should not state that all elements are met unless it also describes the facts that support that conclusion.

      Every Action ROI must include both a list of exhibits attached to the Action ROI and a list of file material, documents, and workpapers maintained in the RO that were obtained or prepared during the investigation, but not exhibited. See Figure 5 for the format of an Action ROI.

      The following general rules apply to the preparation of all ROIs:

      1. The ROI should report all material allegations and leads pursued during an investigation.
      2. The ROI should be objective and not contain legal analysis, recitation or paraphrasing of ERISA, assumptions, Investigator/Auditor opinions, or other extraneous matters. Such items are more appropriately included, if at all, in a cover memorandum accompanying the ROI.
      3. The ROI should report all significant facts contained in the exhibits.
      4. All significant facts presented in the ROI must be supported by a reference to an exhibit (Action ROIs) or by file material and workpapers (Closed ROIs). The ROI must cite the page and paragraph number of the exhibit when an exhibit exceeds two pages in length.
      5. The ROI should be concise and clearly written.
      6. The ROI should identify or define terms, individuals, or abbreviations the first time they are used.
      7. The Investigator/Auditor should promptly prepare a ROI after an investigation is completed.

    2. RD Cover Memorandum Format. The RD’s cover memorandum must accompany each Action ROI and include:

      1. a summary of the facts;
      2. a discussion of ERISA violations;
      3. loss computation(s);
      4. statute of limitations analysis;
      5. potential defendants’ defenses and financial condition(s), if known;
      6. voluntary compliance efforts;
      7. the existence of a parallel criminal investigation, if any;
      8. recommendation(s) for remedies; and
      9. footnotes on page 1 reflecting IRC Section 6103, 26 U.S.C. § 6103 material or referrals to OCA, as appropriate.

      See Figure 6 for the RD cover memorandum.

    3. Notification of Current and Upcoming Litigation Referrals. ROs will send quarterly reports to PBSD, RSOL, OE, and OFA of all current litigation referrals and any upcoming litigation referrals.
  22. Case Closing - No Other Action. When the RO pursues VC with full, partial, or no compliance, the RO should follow case closing procedures outlined in the EM section on Voluntary Compliance Guidelines.
  23. SBREFA Notice. ROs will provide the SBREFA Notice to all plan sponsors, plans, or plan service providers with fewer than 100 participants or employees during the course of a Title I of ERISA civil investigation. See EM section on Voluntary Compliance Guidelines for more information on the SBREFA notice.

(Figure 1)
Memorandum Format for Health Plan Investigative Plan

Subject: Name of Plan
Location
EIN
File No.
To: Supervisor
Date:

Investigative Plan for Subject Case

Results of Search of Indices and Exemption Applications

Summarize any pertinent information in the Regional Office files, which might have a bearing on the investigation.

Analysis and Scope of Investigation

  1. Allegations/Investigative Leads/Basis for Investigation.
    Analyze each allegation, investigative lead, or area of investigation within the context of the applicable sections of the statute, interpretations, and regulations. Identify and individually address each allegation, investigative lead, or area of investigation using the following general outline:
    1. Set forth the issue being investigated, being as concise as possible without sacrificing the meaning.
      1. Indicate which sections of ERISA, if known, appear to have been violated, including applicable references to the statute, regulations, and/or agency guidance.
      2. List the elements of proof needed to establish that a violation has occurred.
      3. Describe the scope of the proposed inquiry. (This section of the work plan should be used to limit, if possible, the expected duration of the inquiry, and to estimate when the investigation should be closed if no evidence of potential violations is found. A well- planned investigation should estimate how much time and effort should be expended before the costs of pursuing the investigation outweigh its potential benefits).

Planned Investigative Activity

By issue, describe what records will be reviewed, what interviews will be conducted, and what information and documentation will be developed. Use the following outline to describe the planned investigative activity.

  1. General.
    Set forth any investigative activity not related to resolving a specific issue such as verifying the adequacy of the plan’s bond.
  2. Allegation/Lead/Area of Investigation.
    Identify all the activity needed to fully investigate the allegation/lead identified in II.A. above.
  3. Allegation/Lead/Area of Investigation #2. Repeat as in b, for all allegations/leads. Investigator’s/Auditor’s Name, Signature, and Date

Approved: ____________________ Date: ____________________ (Initials of Supervisor)

(Figure 2)
Memorandum Format for Updated Health Plan Investigative Plan

Subject:
Name of Plan
Location
EIN
File No.
To: Supervisor
Date:

Update of Investigative Plan

  1. Changes in Original Plan

    Fully describe any deletions from the original plan together with the reasons for the deletions.

  2. Additional Planned Investigative Activity

    Fully describe changes in direction or what additional investigation will be conducted. Investigator’s/Auditor’s Name, Signature, and Date

Approved: ____________________ Date: ____________________ (Initials of Supervisor)

(Figure 3)
Model Health Plan Document Request Letter

Certified Mail No.
Return Receipt Requested

xx
Plan Administrator xx Health Plan
xx xx

RE:

xx Health Plan
Case No.

Dear Plan Administrator:

The Department of Labor has responsibility for the administration and enforcement of Title I of the Employee Retirement Income Security Act of 1974 (ERISA). Title I establishes standards governing the operation of employee benefit plans such as the xx Health Plan (the Plan).

The Plan is scheduled for investigation by this office. Investigative authority is vested in the Secretary of Labor by Section 504 of ERISA, 29 U.S.C. 1134, which states in part:

The Secretary [of Labor] shall have the power, in order to determine whether any person has violated or is about to violate any provision of this title or any regulation or order thereunder...to make an investigation, and in connection therewith to require the submission of reports, books, and records, and the filing of data in support of any information required to be filed with the Secretary under this title....

Additionally, the Plan will be examined for the purpose of determining whether it is complying with the laws contained in Part 7 of ERISA, including the Health Insurance Portability and Accountability Act of 1996, the Newborns’ and Mothers’ Health Protection Act, the Women’s Health and Cancer Rights Act, the Mental Health Parity and Addiction Equity Act, the Genetic Information Nondiscrimination Act, and the Patient Protection and Affordable Care Act and Health Care and Education Reconciliation Act (collectively, the Affordable Care Act). These laws amended Part 7 of ERISA and provide requirements for group health plans.

We have found in the past that submission of relevant documents to our office prior to the inception of an on-site field investigation can lessen the time subsequently spent with, and the administrative burden placed on, plan and corporate officials and may eliminate the need for an on-site visit entirely. To that end, we ask that you submit to this office, within ten business days of your receipt of this letter, the documentation listed on the enclosed Attachment A. If any items are not applicable, please so indicate and provide an explanation.

Thank you in advance for your cooperation. Should you have any questions, please contact the undersigned at XXX-XXX-XXXX.

Sincerely, Attachment

(Figure 4)
Form 203h ROI – Health Plans

 

(Figure 5)
Action Report of Investigation – Sample Format

This document is the property of the Employee Benefits Security Administration. Its contents are not to be disclosed to unauthorized persons.

File No.

Subject: (Last Name of Complainant) v. Employer

Date

Address of Employer

By Investigator/Auditor
Approved by

EIN/PN
Status: Action

  1. Predication

    State the reasons for case opening and for making an investigative effort. Briefly present facts potentially relevant to timeliness under Section 413. Such facts would include, but are not limited to, the following:

    1. The date the case was opened;
    2. The date on which information was received which resulted in the opening of the investigation and a description of that information (including source and recipient);
    3. The date the investigation began; and
    4. The earliest date that any information or document was received that suggested a violation of ERISA and a description, including source and recipient, of that information.

  2. Potential Jurisdictional Problems

    If no jurisdictional problems are anticipated, enter "None". If any are known, set forth the facts to identify them and document jurisdiction under the appropriate section of ERISA. Any issue or potential defense relating to whether the plan is covered under ERISA should be set forth in this section.

  3. Background

    Briefly cite the facts that will establish the following:

    1. Type of Plan
    2. Date and place Plan was established
    3. Plan Sponsor
    4. Type of benefits provided
    5. Type of administration
    6. If jointly administered, name the participating union(s)
    7. Number of Participants - active/retired
    8. Plan Assets - Gross

    Include other background facts as appropriate such as, private litigation and bankruptcy proceedings.

  4. Bonding; Reporting And Disclosure; And Fiduciary Liability Insurance
    1. Briefly cite the facts that will establish that the bonding and reporting and disclosure requirements have been met, or cite the violations uncovered and the corrective actions taken.
    2. If the fiduciaries do not have fiduciary liability insurance, state that fact. If the fiduciaries have fiduciary liability insurance cite the name of the company, effective date of the policy, and amount of the policy. If, because of the nature of the fiduciary breach, more than one company had the fiduciary liability contract, cite the relevant companies, effective dates, and amount of policies.

  5. Plan Administration And Financial Operation

    Where appropriate this section of the report should include, but not be limited to, information concerning: identities and principal duties of all plan officials and principal employees and service providers during the relevant period, including dates of service; funding method; internal controls; investment policies and practices; benefit payment procedures; collection of contributions; and other relevant information relating to plan administration and financial operation.

  6. Request For Variances And Exemptions

    Include under this heading any variances or exemptions that have been requested, and the decision, if any, by OED, or present the status of the request.

  7. Issues & Findings(1)

    1. Use the heading "The Issue/Alleged Violation of Section(s) ______________." Present all the facts from which a conclusion(s) can be drawn that the pertinent section(s) of Part 4 was violated (support with exhibits). In the first paragraph(s) under this heading, set forth facts, which establish whether at least one violator was a fiduciary within the meaning of section 3(21) of ERISA at the time of the occurrence of the fiduciary breach.

      In subsequent paragraphs, set forth the facts to establish the breach of fiduciary responsibilities.

      In the next paragraph(s) present facts necessary to show timeliness under section 413.

      In the next paragraph(s), in situations where efforts were made to obtain voluntary compliance, indicate the results of such efforts. Include copies of any correspondence or RIs of conferences with plan officials as exhibits.

      In the final paragraph(s) set forth the position of the fiduciary and any other involved party on the possible violation.

    2. Describe the next issue, and alleged ERISA violation, in the format set forth above.

  8. Other Findings

    This heading can be used to present facts or any other investigative activity not previously mentioned.

Exhibits

All significant facts presented in the report should be supported with exhibit citations. The following procedures should be used in submitting exhibits.

  1. State the name of the individual who is the subject of an RI, signed statement or sworn administrative testimony and the date of the interview or testimony.
  2. Documents, schedules, etc., should be complete and precisely identified.
  3. Each supporting document should be the final version of the document under which the parties are operating at the time of the alleged breach.
  4. Each supporting document should be a separate exhibit.
  5. Multiple page exhibits should be numbered.
  6. Exhibits should be identified by number.
  7. All copies must be legible.
  8. All plan documents (trust agreement, etc.), relevant minutes of meetings of plan fiduciaries, canceled checks, contracts/agreements, or any other supporting documents pertaining to the transaction(s) at issue, third-party corroborating interviews and/or records, and expert opinions, if any, must be included as exhibits.
  9. Fiduciary liability insurance policy(s) held on the date(s) of the alleged violation(s) and/or at any time subsequent to that date should be included as exhibits. Attempts should be made to determine if the policies are/were in force.
  10. Copies of all annual reports, with attachments, which have been filed by the subject plan subsequent to the transaction or action at issue, must be included as exhibits.

List of documents and workpapers available in RO but not used as exhibits

List documents, schedules, RIs etc., in the RO file that were not included as exhibits. Identify all applicable dates of such documents (e.g., date prepared, date received, etc.).

(Figure 6)
Format for Regional Director’s Cover memorandum to An Action ROI

Memorandum For:
____________________
Office of the Solicitor
(Regional Solicitor or PBSD, as appropriate)

From:
____________________
Regional Director
XYZ Regional Office

Subject:

Name and Address of Plan/Related Entity(1,2)

EIN/PN ____________________
And/or ____________________

Introduction: Identify the RO/DO which conducted the investigation, the plan and plan sponsor name(s), and the related entity, if applicable.

Briefly describe the issues and the total apparent losses involved.

Background: Briefly describe the plan(s) and/or related entities involved, including type, nature of benefits/services provided, type of administration, number of participants/plans serviced, and amount of plan assets.

Facts/Violations: Briefly summarize the essential facts demonstrating each violation. For each issue discuss ERISA section(s) violated and explain the basis for any loss computation.

Statute of Limitations: Discuss the statute of limitations date applicable to each issue identifying the earliest applicable date(s).

Position of the Fiduciaries/Related Parties: Discuss the position of the fiduciaries and/or other parties on each issue, if known. If unknown, state the reason(s) why the RO was unable to obtain this information (e.g., parties’ refusal to be interviewed).

Financial Condition of the Fiduciaries/Related Parties: Discuss the financial condition of the fiduciaries and/or related parties, if known. If unknown, state the steps taken by the RO to obtain this information. Also state whether the fiduciaries have fiduciary liability insurance.

Issues Resolved Through Voluntary Compliance: Briefly discuss any issue(s) resolved through voluntary compliance, including any 502(l) implications.

Parallel Investigations: Note any parallel criminal investigations being conducted involving the subject plan and/or its fiduciaries.

Recommendations: Discuss the appropriate remedies, for each violation identified, including but not limited to restitution, rescission of prohibited transactions, removal of fiduciaries, appointment of a receiver, disgorgement, indemnification of the plan against future losses, injunctions against future service to ERISA plans, imposition of 502(i) and 502(l) penalties as applicable, etc.

Footnotes

  1. This memorandum and the Action ROI on page(s)____ , and exhibits ____ contain IRC 6103 information and should be handled accordingly.
  2. This case presents possible reporting deficiencies and/or blackout deficiencies for which ERISA section 502(c)(2) and/or 502(c)(7) civil penalties may be imposed by OCA and which have been referred to OCA. This case presents possible IQPA deficiencies referred to OCA.