U.S. Representative George Miller (D-California) requested that newly appointed PBGC Director Joshua Gotbaum work with PBGC Inspector General Rebecca Anne Batts to find out the full impact of any errors the auditing contractor made, Dow Jones reported.
According to the news account, Miller said Gotbaum and Batts needed to “determine the scope and severity of the problem and to properly hold accountable any contractor or employee who failed to execute their duties in the manner consistent with the requirements of the law.” Miller is chairman of the House Education and Labor Committee.
Dow Jones said the controversy surrounds the proper valuation of the United plans that were terminated in 2005 and valued according to a PBGC estimate at the time as being underfunded by $10.4 billion with $6.8 billion in assets to cover $17.2 billion in obligations.
Miller’s demand of Gotbaum follows the lawmaker’s request last year that Batts investigate the terminations, a probe that concluded with a Batts’ finding that the contracted auditors failed to “exercise due professional care in their work.” United plan terminations has also been the subject of court action (see Bankruptcy Judge Upholds Termination of United Pilots’ Pension Plan).
Batts told Dow Jones Newswires, “errors and omissions in unaddressed differences” in the work done by the auditors were “material.” A letter Batts sent to Miller, according to Dow Jones, said her office “determined that the issues surrounding the inadequate plan asset audits were so significant that additional, more detailed evaluation is warranted.”
Evaluation work conducted to date hasn’t determined whether plan-participant benefits would be affected. “It would be unfair for anyone to begin thinking they were getting more benefits on account of this,” Batts told Dow Jones. “We just don’t know.”