During testimony before the House Education and the Workforce Committee yesterday, executives Cindy Olson and Mikie Rath were asked about published reports that unauthorized payments had been made from pension funds. They denied that any such payments took place. Rath also said any and all payments made from the pension funds were fully disclosed on the plan’s 5500 filings.
Earlier this week, a former senior accountant at Enron told CBS Evening News that the company had stolen $15 million from its employees benefits account. Robin Hosea claimed that she noticed that large sums of employee benefits money was being spent by other departments at Enron – without the approval of the benefits department.
Also Thursday, in response to questions from Representative George Miller (D-California) about payments allegedly made to executives from nonqualified ‘rabbi’ trusts, Scott Peterson, Hewitt’s head of global defined contribution practice, said that he had no specific knowledge of those payments.
However, he acknowledged that the individual records for those plans had transferred to Hewitt at the same time as the 401(k), and that Enron representatives had told Hewitt that some payments had been made prior to that date. Enron transferred its recordkeeping function from Northern Trust to Hewitt last fall.