PBGC Seeks Comments for Missing Participants Program

July 2, 2013 (PLANSPONSOR.com) – The Pension Benefit Guaranty Corporation (PBGC) is seeking comments about implementing a new program to deal with benefits of missing participants in terminating individual account plans.

The agency is interested in stakeholders’ views on topics such as the extent of the demand for such a program, the demand for a database of missing participants, the availability of private-sector missing participant services, potential program costs and fees, electronic filing, and the contours of diligent search requirements.

According to the PBGC notice, before the Pension Protection Act (PPA) of 2006, Section 4050 of the Employee Retirement Income Security Act (ERISA) required the agency to operate, and pension plans to use, a missing participants program limited to single-employer plans covered by Title IV of ERISA. The PPA amended Section 4050 to provide for a similar mandatory program for covered multiemployer plans and an optional program for non-covered plans, both individual account plans (defined contribution [DC] plans) and defined benefit (DB) plans not covered by Title IV. It also authorized the PBGC to require non-covered plans to submit information to the PBGC about missing participants’ benefits.

Last September, the Internal Revenue Service (IRS) announced it will no longer forward letters on behalf of plan sponsors or administrators of qualified retirement plans or qualified termination administrators (QTAs) of abandoned plans under the Department of Labor’s Abandoned Plan Program who are attempting to locate missing plan participants and beneficiaries (see “IRS Stops Forwarding Letters for Missing Participants”). The agency noted that since its letter-forwarding program began, numerous alternative missing person locator resources, including the Internet, have become available to assist a plan sponsor or plan administrator in locating a missing participant or beneficiary owed a retirement benefit, enabling the program change.   

More about the PBGC’s request for comments is here.