MIL-OSI USA: Graphic Communications National Pension Plan Agrees to Repay Excess Special Financial Assistance Funds

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Source: US State of California

The Graphic Communications National Pension Fund (the NPF) has entered into a civil settlement agreement pursuant to which it has agreed to repay more than $8 million in excess funds that it received from the Pension Benefit Guaranty Corporation (PBGC) in connection with the PBGC’s Special Financial Assistance Program.

The American Rescue Plan Act of 2021 established the Special Financial Assistance (SFA) Program to protect millions of workers in multiemployer pension plans who faced cuts to their benefits, including potentially catastrophic benefit reductions in many cases. The SFA Program is administered by the PBGC, which was authorized to make one-time payments to certain eligible multiemployer pension plans in the amount that was projected to enable the plans to pay all benefits through 2051. Because inclusion of participants who died in the census data provided with the SFA application could alter the amount of funding that an eligible multiemployer plan would need to pay benefits in future years, the PBGC required SFA applicants to provide documentation of an independent death audit to identify deceased participants in support of plans’ SFA applications. 

Despite reasonable efforts, the NPF’s census erroneously included approximately 371 deceased participants among the more than 30,000 plan participants identified in the plan’s SFA application. The erroneous inclusion of deceased participants in the NPF’s application was identified during an audit conducted by the PBGC’s Office of Inspector General (PBGC-OIG).  The audit determined that as a result of the errors the NPF’s SFA award of approximately $1.5 billion was overstated by approximately $8 million. The NPF cooperated with the government’s investigation in this matter, including assisting with the actuarial analyses necessary to calculate and validate the amount of the excess funds that it received.      

“The Civil Division will continue to work with PBGC to recover any excess funds paid in connection with the SFA Program,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Department of Justice’s Civil Division. “I commend the NPF for its cooperation with the government’s efforts to identify and quantify excess SFA Program funds, as well as its prompt repayment.”

“Correcting an inaccurate SFA payment serves everyone’s interests and gives the public greater confidence in the stewardship of taxpayer money by Federal employees,” said PBGC Inspector General Nicolas J. Novak. “We appreciate the continuing cooperation of the affected plans with the PBGC and the Justice Department’s efforts.”

“PBGC is working diligently with other plans to facilitate return of SFA funds based on inaccurate census data,” said PBGC Acting Director Ann Y. Orr. “PBGC appreciates the collaborative efforts of DOJ and PBGC-OIG involved in these recoveries.”

The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, the PBGC-OIG and the PBGC Office of General Counsel, along with the Department of Labor and Department of Treasury. This is the second settlement involving the return of excess SFA funds received from PBGC, with combined recoveries now totaling more than $134 million.

Senior Trial Counsel Kelley Hauser of the Civil Division’s Commercial Litigation Branch handled this matter. 

The claims resolved by the settlement are allegations only. There has been no determination of liability.