|
 Printer
Friendly Version
1. Statutory Authority. The
investigative authority given to the Secretary of Labor
(Secretary) under ERISA is found in section 504 and section
506 (as amended by the Comprehensive Crime Control Act of
1984) and relates to all investigations undertaken pursuant to
Title I of the Act.
2. Interpretation of Section 504.
Section 504(a) gives investigative authority to the Secretary
in order to determine whether any person has violated Title I
of ERISA or any regulations or orders issued thereunder. This
authority extends to investigations of actual or potential
violations of Title I.
3. Interpretation of Section 506.
Section 506(b) was amended by the Comprehensive Crime Control
Act of 1984 to give the Secretary explicit authority to
investigate criminal violations of Title 18 of the United
States Code, insofar as they relate to employee benefit plans.
In particular, the Secretary was given specific jurisdiction
to investigate potential criminal violations of Sections 664,
1027, 1954, 669, 1035, 1347, and 1518 of Title 18. However,
the Secretary continues to observe certain limitations on the
exercise of this authority under an agreement with the
Department of Justice. See paragraph 6 below.
4. Making Information Available to
Affected Person. Section 504(a) provides that the
Secretary may make information available to any person
actually affected by any matter which is the subject of an
investigation. Generally, such persons will include plan
fiduciaries, participants, beneficiaries, or their
representatives. In appropriate cases, others may also be
included. This section does not permit disclosure of
information specifically prohibited by another statute, such
as grand jury information subject to Rule 6(e) of the Federal
Rules of Criminal Procedure or tax information subject to
Section 6103 of the Internal Revenue Code. (See Chapter 20,
Release of Information, for discussion of restrictions on
disclosure).
5. Delegation of Authority to Assistant
Secretary for Employee Benefits Security. Secretary's
Order 1-87 dated April 13, 1987,(1)
states, in part, that the Assistant Secretary for Pension and
Welfare Benefits is delegated authority -- including authority
to redelegate -- and assigned responsibilities for carrying
out programs and activities to be performed by the Secretary
under:
a. The Employee Retirement Income
Security Act of 1974, as amended, except for subtitle C of
Title III, and Title IV;(2)
b. The Welfare and Pension Plans
Disclosure Act of 1958, as amended;(3)
and
c. The Federal Employees' Retirement
System Act of 1986.
Secretary’s Order 01-2003, dated January
23, 2003, re-designated the title and position of the
Assistant Secretary for Pension and Welfare as the Assistant
Secretary for Employee Benefits Security. All programs,
activities, functions and responsibilities delegated to the
Office of the Assistant Secretary for Pension and Welfare
Benefits or the Pension and Welfare Benefits Administration
were re-designated programs, activities, functions and
responsibilities of the Office of the Assistant Secretary for
Employee Benefits Security or the Employee Benefits Security
Administration, respectively(4)
(Figure 1).
6. Investigation of Criminal Matters
Related to ERISA
a. On February 9, 1975, the Department of
Labor (DOL) and the Department of Justice (DOJ) executed a
Memorandum of Understanding (MOU) which provided for a
specific case-by-case delegation from the DOJ regarding
investigations of criminal matters relating to employee
benefit plans (Figure 2). With the passage of the
Comprehensive Crime Control Act of 1984, the DOL has express
statutory authority to investigate criminal matters relating
to employee benefit plans. Accordingly, the DOL is no longer
required to obtain delegation on a case-by-case basis;
however, Employee Benefits Security Administration (EBSA)
Investigators/Auditors will contact the appropriate United
States Attorney's Office (USAO) as early as possible in the
investigation to determine interest by the USAO. (See
Chapter 52, Criminal Investigations, for EBSA policy
concerning criminal investigations involving employee
benefit plans.)
b. The Secretary will either on complaint
of an alleged violation or on his/her own motion investigate
through his/her own staff all matters that may form the
basis for possible criminal action under Section 501 of the
Act. These matters include reporting and disclosure
provisions under part 1 of Title I and any regulations
issued thereunder.
7. Parallel Civil and Criminal
Investigations. Occasionally, EBSA personnel are requested
to terminate or postpone a civil ERISA investigation pending
completion of another government agency's investigation of a
parallel criminal matter. Procedures for handling such
requests are set forth in Chapter 52, paragraph 13.
8. Section 411(a) Exemption Proceedings.
Pursuant to the MOU between the Secretary and the Department
of Justice, the investigation and presentation of issues
concerning the appropriateness of a grant of a Certificate of
Exemption under Section 411(a) to a person by a federal court
will be the responsibility of the Department of Labor,
including appearances before the court. (See Chapter 47,
Prohibited Persons.)
9. Investigations Under Title IV of
ERISA. The statute does not give the Secretary authority
to investigate under Title IV of the Act. Under Section
4003(d), the Pension Benefit Guaranty Corporation (PBGC) may
make agreements with the Secretary to help carry out the
provisions of Title IV.
10. Litigative Responsibility for Civil
Cases. A Memorandum of Understanding entered into on
February 11, 1975, between the Department of Justice and the
Department of Labor, established litigative responsibility
under ERISA (Figure 2). Pursuant to the agreement, primary
litigative responsibility for the preparation and presentation
of most civil cases arising in the district courts and courts
of appeals under the Employee Retirement Income Security Act
of 1974 is exercised by attorneys in the Office of the
Solicitor of Labor. There are certain exceptions which are set
out in the Memorandum of Understanding.
11. Prosecution of Criminal Matters.
The Memorandum of Understanding between the Secretary and the
Department of Justice provides that all cases involving
criminal provisions of ERISA will be prosecuted by the
Department of Justice (Figure 3).
12. Agreements with Other Government
Agencies. EBSA, in addition to having agreements with the
Department of Justice, has agreements with the following
government agencies:
Internal Revenue Service (Chapter 12);
Departments of Treasury and Health and
Human Services (Chapter 12);
Office of the Inspector General, Office
of Labor Racketeering (Chapter 13); and,
Federal Financial
Institution Regulatory Agencies (Federal Reserve System,
Federal Deposit Insurance Corporation, Federal Home Loan
Bank Board (FHLBB),(5)
National Credit Union Administration, and the Office of the
Comptroller of the Currency) (Chapter 14).
(Figure 1)
Subject: Delegation of Authority and
Assignment of Responsibilities to the Employee Benefits
Security Administration
1. Purpose. To delegate
authority and assign responsibilities for the administration
of the Department of Labor’s responsibilities under the
Employee Retirement Income Security Act of 1974 (ERISA), the
Welfare Pension Plans Disclosure Act (WPPDA) and the Federal
Employees’ Retirement System Act of 1986 (FERSA), and to
change the name of the office of the Assistant Secretary for
Pension and Welfare Benefits and the Pension and Welfare
Benefits Administration (PWBA).
2. Authority and Directives Affected.
This Order is issued pursuant to 5 U.S.C. 301; 29 U.S.C. 551,
et seq.; and 5 U.S.C. 5315. This order supersedes the
Secretary’s Order 1-87, 52 Fed. Reg. 13139 (Apr. 21, 1987),
and the memoranda to Meredith Miller, on Oct. 28, 1998, 63
Fed. Reg. 59339 (Nov. 3, 1998), and on December 16, 1998, 63
Fed. Reg. 71506 (Dec. 28, 1998).
3. Background. ERISA places
responsibility in the Department of Labor for the
administration of a comprehensive program to protect the
interests of participants and beneficiaries of private sector
employee benefit plans. Secretary’s Order 1-87 delegated
authority for this program to the Pension and Welfare Benefits
Administration (PWBA), which was headed by the Assistant
Secretary for Pension and Welfare Benefits who reported to the
Secretary of Labor.
FERSA requires the Department of Labor to,
among other things, administer and enforce the fiduciary
responsibility, prohibited transaction, and bonding provisions
of FERSA. Secretary’s Order 1-87 also delegated these
responsibilities to PWBA.
In more recent years, statutes such as the
Health Insurance Portability and Accountability Act of 1996 (HIPAA),
the Newborns’ and Mothers’ Health Protection Act of 1996,
the Mental Health Parity Act of 1996, the Women’s Health and
Cancer Rights Act of 1998, and the Child Support Performance
and Incentive Act of 1998 amended ERISA. Pursuant to Secretary’s
Order 1-87, PWBA has carried out the Department’s additional
responsibilities under these Acts.
Changing the agency’s name to the
Employee Benefits Security Administration (EBSA) will more
clearly communicate the agency’s mission of protecting
private sector employee benefits. Restating the delegations
contained in Secretary’s Order 1-87, and including an
additional delegation regarding claims of governmental
privileges, previously published separately, will provide a
single source for questions regarding the Assistant Secretary’s
current authority and responsibility.
4. Re-Designation of the Assistant
Secretary for Pension and Welfare Benefits and the Pension and
Welfare Benefits Administration.
a. The title and position of the
Assistant Secretary for Pension and Welfare Benefits is
re-designated Assistant Secretary for Employee Benefits
Security. The Office of the Assistant Secretary for Pension
and Welfare Benefits is re-designated the Office of the
Assistant Secretary for Employee Benefits Security, and
b. The Pension and Welfare Benefits
Administration is re-designated as the Employee Benefits
Security Administration.
c. All offices, subdivisions and
positions within the Department of Labor deriving their
names in whole, or in part, from the Office of the Assistant
Secretary for Pension and Welfare Benefits or the Pension
and Welfare Benefits Administration shall accomplish an
appropriate change of name pursuant to this order.
d. All employees of the Office of
Assistant Secretary for Pension and Welfare Benefits and the
Pension and Welfare Benefits Administration are
re-designated employees of the Office of the Assistant
Secretary for Employee Benefits Security Administration,
respectively.
e. All programs, activities, functions,
and responsibilities delegated to the Office of the
Assistant Secretary for Pension and Welfare Benefits or the
Pension and Welfare Benefits Administration are
re-designated programs, activities, functions and
responsibilities of the Office of the Assistant Secretary
for Employee Benefits Security or the Employee Benefits
Security Administration, respectively.
f. All currently effective delegations
made by the Assistant Secretary for Pension and Welfare
Benefits to employees of the Pension and Welfare Benefits
Administration are deemed delegations by the Assistant
Secretary for Employee Benefits Security to employees of the
Employee Benefits Security Administration.
g. Other agencies within the Department
of Labor shall make any appropriate re-designation in
conformity with the spirit and purpose of this order.
5. Delegation of Authority and
Assignment of Responsibilities
a. Except as hereinafter provided, the
Assistant Secretary for Employee Benefits Security is
delegated the authority (including the authority to
re-delegate) and assigned the responsibilities of the
Secretary of Labor:
(1) under the following statutes,
including any amendments:
(i) The Employee Retirement Income
Security Act of 1974, as amended, except for subtitle C
of Title III and Title IV (29 U.S.C. §§ 1001-1232);
(ii) the Welfare and Pension
Disclosure Act of 1958, as amended Pub. L. 85-836, 72
Stat. 997; Pub. L. 86-624, 74 Stat. 417; Pub. L. 87-420,
76 Stat. 35;
(iii) The Federal Employees’
Retirement System Act of 1986 (5 U.S.C. §§ 8401-8479);
and
(iv) as directed by the Secretary,
such additional Federal acts similar to or related to
those listed in paragraphs (i) through (iii), above,
that from time to time may assign additional authority
or responsibilities to the Secretary.
(2) to request information the Internal
Revenue (IRS) possesses for use in connection with the
administration of Title I of ERISA of 1974.
(3) to invoke all appropriate
governmental privileges, arising from the functions of the
Employee Benefits Security Administration, following
his/her personal consideration of the matter and in
accordance with the following guidelines:
(i) Generally Applicable Guidelines.
The Assistant Secretary may not re-delegate the
authority to invoke a privilege. The privilege may be
asserted only with respect to specifically described
information and only where the Assistant Secretary
determines the privilege is applicable. In asserting a
privilege, the Assistant Secretary shall articulate in
writing the specific reasons for preserving the
confidentiality of the information.
(ii) Informant’s Privilege (to
protect from disclosure the identity of any person who
has provided information to the Employee Benefits
Security Administration in cases arising under the
statutory provisions listed in 5.a.(1) of this order
that are delegated or assigned to the Employee Benefits
Security Administration). To assert this privilege, the
Assistant Secretary must first determine that disclosure
of the privileged matter may: (A) interfere with the
Employee Benefits Security Administration’s
enforcement of a particular statute for which it
exercises investigative or enforcement authority; (B)
adversely affect persons who have provided information
to the Employee Benefits Security Administration; or (C)
deter other persons from reporting violations of the
statute.
(iii) Deliberative Process Privilege
(to withhold information which may disclose
pre-decisional intra-agency or inter-agency
deliberations in cases arising under the statutory
provisions listed in paragraph 5.a.(1) of this order
including: the analysis and evaluation of facts; written
summaries of factual evidence; and recommendations,
opinions, or advice on legal or policy matters.) To
assert this privilege, the Assistant Secretary must
first determine that: (A) the information is not purely
factual and does not concern recommendations that the
department expressly adopted or incorporated by
reference in its ultimate decision; (B) the information
was generated prior to and in contemplation of a
decision by a part of the Department; and (C) disclosure
of the information would have an inhibiting effect on
the Department’s decision-making process.
(iv) Privilege for Investigative
Files compiled for law enforcement purposes (to withhold
information which may reveal the Employee Benefits
Security Administration’s confidential investigative
techniques and procedures). To assert this privilege,
the Assistant Secretary must first determine that
disclosure of the privileged matter may have an adverse
impact upon the Employee Benefits Security
Administration’s enforcement of the statutory
provisions listed in paragraph 5.a.(1) of this order,
by: (A) disclosing investigative techniques and
methodologies; (B) deterring persons from providing
information to the Employee Benefits Security
Administration; (C) prematurely revealing the facts of
the Department’s case; or (D) disclosing the
identities of person who have provided confidential
information under an express or implied promise of
confidentiality.
(v) Prior to filing a formal claim of
privilege, the Assistant Secretary shall personally
review the information sought to be withheld, including
all documents sought to be withheld (or, in cases where
the volume of information is so large all of it cannot
be personally reviewed in a reasonable time, an adequate
and representative sample of such information) and a
description or summary of the litigation in which the
disclosure is sought.
(vi) The Assistant Secretary may
comply with any additional requirements imposed by local
court rules or precedent in asserting a governmental
privilege.
(vii) In asserting a governmental
privilege, the Assistant Secretary may ask the Solicitor
of Labor or the Solicitor’s representative to prepare
and file any necessary legal papers or documents.
b. The Solicitor of Labor is responsible
for providing legal advice and assistance to all officials
of the Department relating to the administration of the
statutes listed in paragraphs 5.a.(1) of this order, for
bringing appropriate legal actions on behalf of the
Secretary, and representing the Secretary in all civil
proceedings. The Solicitor of Labor is also authorized to
request information the IRS possesses for use in connection
with the administration of Title I of ERISA.
c. The Inspector General is authorized to
request information the IRS possesses for use in connection
with the administration of Title I of ERISA.
6. Reservation of Authority
a. The submission of reports and
recommendations to the President and the Congress concerning
the administration of the statutes listed in paragraph
5.a.(1) of this order and responsibilities under Subtitle C
of Title III of ERISA are reserved to the Secretary. The
Pension Benefit Guaranty Corporation carries out
responsibilities under Title IV of ERISA.
b. This Secretary’s Order does not
affect the authorities and responsibilities of the Office of
Inspector General under the Inspector General Act of 1978,
as amended, or under Secretary’s Order 2-90 (January 31,
1990)
7. Effective Date. This order
is effective upon date of publication in the Federal Register.
|
/s/ Elaine L. Chao
Secretary of Labor |
January 23, 2003 |
(Figure 2)
Memorandum of Understanding Between the
Departments of Justice and Labor Relating to the Investigation
and Prosecution of Crimes and Related Matters under Title I of
the Employee Retirement Income Security Act of 1974
It is hereby agreed and understood
between the Department of Justice and the Department of Labor
as follows:
Whereas Title I of the Employee Retirement
Income Security Act of 1974 (P.L. 93-406, 88 Stat. 829,
29 U.S.C. 1001, hereinafter referred to as "the
Act") imposes certain duties and responsibilities upon
the Attorney General and the Secretary of Labor with regard to
prosecution of crimes and related matters arising under the
Act; and
Whereas, section 504 of the Act imposes
upon the Secretary of Labor the responsibility for conducting
investigations of persons who have violated or are about to
violate any provision of Title I of the Act or any regulation
issued thereunder; and
Whereas, section 506 of the Act provides
that the Secretary of Labor may make interagency agreements to
avoid unnecessary expense and duplication of functions among
government agencies and ensure cooperation and mutual
assistance in the performance of his functions under the Act;
and
Whereas, section 506 of the Act provides
that the Attorney General or his representative shall receive
from the Secretary of Labor for appropriate action such
information developed in the performance of the Secretary's
functions under Title I of the Act as may be found to warrant
consideration for criminal prosecution; and
Whereas, it is desirable and essential that
the areas of responsibility and the procedure to be used in
investigations and prosecutions of offenses arising under the
Act should be the subject of a formal agreement between the
Departments;
I. Criminal Prosecution
All cases involving violation of criminal
provisions of the Act will be prosecuted by the Department of
Justice. Those cases investigated by the Department of Labor
which may warrant criminal prosecution will be referred to the
Management and Labor Section, Criminal Division, Department of
Justice.
II. Investigations of Matters made
Criminal by the Act
Subject to specific arrangements agreed
upon by the two Departments on a case-by-case
basis, investigations of criminal matters under the Act will
be conducted as follows:
(a) The Department of Justice will
investigate all matters arising under 18 U.S.C. 664 (theft
or embezzlement from employee benefit plan), 1027 (false
statements and concealment of facts in relation to documents
required by the Act) and 1954 (offer, acceptance, or
solicitation to influence operations of employee benefit
plans).
(b) The Secretary of Labor will either on
complaint of a violation or on his own motion investigate
through his own staff all matters that may form the basis
for possible criminal action under section 501 of the Act.
These matters include reporting and disclosure provisions
under Part I of Title I of the Act and any regulations
issued thereunder.
(c) The Department of Justice will under
delegation from the Secretary of Labor investigate those
criminal matters arising under:
(1) Section 411 of the Act (prohibition
against certain persons being a consultant to, employed
by, or holding office in an employee benefit plan and
against allowing such persons to act as a consultant to,
be employed by, or hold office in an employee benefit
plan).
(2) Section 511 of the Act
(interference with the rights of a participant or
beneficiary by fraud or coercion).
III. Parole Board Proceedings
The investigation and presentation of
issues concerning the appropriateness of a grant of a
certificate under Section 411(a) of the Act to a person by the
Board of Parole of the Department of Justice will be the
responsibility of the Department of Labor, including
appearances before the Board of Parole.
IV. Instructions
So that the terms of this Memorandum of
Understanding will be effectively performed, both Departments
will issue instructions for the guidance of their officers and
employees in the matters referred to in the preceding
paragraphs, such instructions to be submitted for comment to
the other Department prior to their issuance.
V. Adjustments
Periodic reviews of this agreement will be
made to determine whether any adjustments are desirable in
light of experience under the Act.
|
/S/ Peter J. Brennan
Secretary of Labor |
February 5, 1975 |
|
/S/ L. N. Silberman
(Acting) Attorney General |
February 8, 1975 |
(Figure 3)
United States Department Of Labor
Memorandum Of Understanding
Whereas, the Employee Retirement Income
Security Act of 1974 (P.L. 93-406; 88 Stat. 829), the
Occupational Safety and Health Act of 1970 (P.L. 91-596;
84 Stat, 1590), and the Farm Labor Contractor Registration Act
Amendments of 1974 (P.L. 93-518; 88 Stat. 1652), each
provide that except for litigation in the Supreme Court of the
United States and the United States Court of Claims, attorneys
appointed by the Secretary of Labor may represent the
Secretary in civil actions, subject to the direction and
control of the Attorney General;
Whereas, this memorandum has been entered
into in accordance with the legislative history of the
aforementioned provisions; and
Whereas, satisfactory cooperative
relationships exist between the Civil Division of the
Department of Justice and the Department of Labor with respect
to the conduct of litigation under other statutes administered
by the Department of Labor;
Now, therefore, the following memorandum of
understanding is entered into between the Attorney General of
the United States and the Secretary of Labor for the purposes
of promoting the efficient and effective handling of
government litigation concerning these statutes.
1. It is the intention of the Attorney
General to delegate primary litigative responsibility for
the preparation and presentation of most civil cases arising
in the district court and courts of appeal under the
Occupational Safety and Health Act of 1970, the Employee
Retirement Income Security Act of 1974, and the Farm Labor
Contractor Registration Act of 1974, to attorneys appointed
by the Secretary of Labor. The delegation of primary
litigative responsibility shall, in the normal course,
include the preparation and filing of all papers, the
conduct of trials and the presentation of oral arguments.
These activities shall be performed with the cooperation and
assistance of the United States Attorneys and the Civil
Division of the Department of Justice and be subject to the
direction and control of the Attorney General.
2. There will be, however, a limited
number of cases in which primary litigative responsibility
may be retained in the Civil Division of the Department of
Justice.
The criteria for retention of primary
litigative responsibility are:
(i) Cases raising significant issues
concerning the validity or construction of statutes or
important governmental regulatory schemes;
(ii) Cases having a significant impact
on, or which can be expected to have a significant impact
on, the government as a whole, or on agencies, or programs
of agencies, other than the Department of Labor.
3. To facilitate determinations by the
Assistant Attorney General for the Civil Division as to the
delegation of primary litigative responsibility, the
Department of Labor shall, as to any case subject to this
memorandum, provide the Civil Division with:
(i) A copy of any claim, complaint or
petition for review proposed to be filed by the Department
of Labor;
(ii) A copy of any complaint,
responsive pleading or petition for review filed by a
party to litigation other than the Department of Labor,
whenever such pleading has not otherwise been served on
the Attorney General;
(iii) Immediate notice should a case,
the primary responsibility for which has been delegated to
the Department of Labor, come within the criteria of
paragraph 2, supra, during the course of the proceedings
in that case;
(iv) A memorandum proposing an appeal
be taken from a district court from a decision adverse to
the government; and
(v) A memorandum describing any case in
which a district court decision favorable to the
government has been appealed by another party to the
litigation.
The Department of Labor shall provide the
Civil Division with all of the material necessary for a
determination as to the delegation of primary litigative
responsibility within a reasonable time. The Assistant
Attorney General for the Civil Division shall make the
determination within 20 days time of receipt of the above
material or within such reasonable time as the exigencies of
the situation demand.
4. In each instance where the Civil
Division determines to retain primary litigative
responsibility for the handling of litigation under the
criteria set forth in paragraph 2, supra, it shall be the
responsibility of the Assistant Attorney General for the
Civil Division to set forth in writing in a communication to
the Solicitor of Labor the basis for the retention of
primary responsibility and the reasons therefore. If the
Solicitor of Labor disagrees with any such determination, he
shall present his views to the Deputy Attorney General who
shall have final authority to resolve the matter.
5. In the conduct of any litigation
subject to this agreement, regardless of where primary
litigative responsibility is reposed, Department of Justice
and Department of Labor attorneys will cooperate and
collaborate in the preparation and representation of such
actions and the Attorney General will retain the final
authority to determine, where appropriate, the government's
litigating position.
6. This memorandum is intended to provide
a general description of the delegation of litigation
responsibility. Decisions regarding the implementation of
this agreement, including the development of special
procedures for the handling of cases in which circumstances
require the immediate filing of a pleading, are to be made
by the Solicitor of Labor and the Assistant Attorney General
for the Civil Division.
7. Nothing in this agreement shall affect
any authority of the Department of Labor to take action
under the statutes subject to this agreement, other than the
instituting or conducting of litigation in court under such
statutes.
8. Nothing in this agreement shall affect
any authority of the Solicitor General to authorize or
decline to authorize appeals by the government from any
district court to any appellate court or petitions to such
courts for the issuance of extraordinary writs, such as the
authority conferred by 28 C.F.R. 0.20(b).
9. In order effectively to implement the
terms of this Memorandum, each Department will issue to all
personnel affected by its provisions a copy of this
Memorandum. This Memorandum shall not preclude both
Departments from entering into mutually satisfactory
arrangements concerning the handling of a particular case.
10. This agreement shall apply to all
cases filed on or after the date of approval of this
agreement by the Department of Justice and the Department of
Labor.
With respect to cases arising before the
effective date of this agreement, the Departments of Justice
and Labor shall enter into mutually satisfactory arrangements
for the transfer of litigation responsibility in individual
cases, consistent with the purposes of this agreement and
where such transfer will not be prejudicial to the handling of
such cases.
|
/S/ Laurence H. Silberman
Attorney General |
February 11, 1975 |
|
/S/
Peter J. Brennan
Acting Secretary of Labor |
February 11, 1975 |
|
