December 1, 2011 (PLANSPONSOR.com) – The Pension Benefit Guaranty Corporation’s (PBGC) Inspector General released a report describing shortcomings in the way the agency valued assets in plans it assumed from United Airlines in 2007 and 2008.
The report, requested by U.S. Representative George Miller (D-California) (see Miller Demands PBGC Auditor Probe), is titled “PBGC Processing of Terminated United Airlines Pension Plans Was Seriously Deficient.” The agency acknowledged the failings over a year ago and began to redo the work. PBGC has also undertaken a strategic review and committed to make changes to ensure the mistakes are not repeated in the future.
The agency said it does not yet know how many people were affected and by how much, but has a policy of correcting any underpayments regardless of amount. If people have been underpaid, PBGC will correct the error and pay the overdue amount with interest. If there have been overpayments, PBGC said it will adjust future payments gradually, without interest or penalty.
“At PBGC, our job is to provide retirement security,” said Vince Snowbarger, deputy director of operations. “We have acknowledged that we at PBGC did poor work and we are embarrassed by it. We understand that any error, no matter how small and even if it affects only a few people, undermines the confidence and security of all of the people we serve. We are committed to fixing our mistakes and making things right. And we are grateful to Congressman Miller and our IG for helping us to make PBGC better.”