If you want to understand where the Department of Labor is headed on retirement plan investigations, the agency recently provided a roadmap. The Employee Benefits Security Administration (EBSA) updated its national enforcement projects, which essentially signal where investigators will focus their attention in the coming years.
For plan sponsors, this announcement is worth paying attention to—not because it creates new rules, but because it highlights the areas where regulators believe the biggest risks currently exist.
One of the most notable additions to the enforcement list is cybersecurity. Retirement plans hold sensitive participant data and billions of dollars in assets, making them attractive targets for cybercriminals. EBSA investigators will review whether plans and service providers follow best practices to protect systems and data from cyber threats.
Another major focus will be retirement asset management. The DOL intends to closely examine whether fiduciaries are prudently selecting and monitoring investment options, as well as evaluating plan fees. Even in participant-directed plans relying on ERISA’s Section 404(c) safe harbor, fiduciaries remain responsible for choosing and monitoring the investment lineup.
The agency will also continue prioritizing protecting participant benefit distributions, particularly when plans are abandoned or sponsors fail to properly distribute benefits owed to former employees.
Interestingly, the DOL has reduced its focus on missing participants and removed ESOPs from the national enforcement list, signaling a shift in investigative priorities.
For plan sponsors, the takeaway is straightforward: enforcement priorities change, but fiduciary responsibilities remain the same. Sponsors should regularly review cybersecurity protections, investment monitoring processes, and procedures for locating participants and paying benefits.
In other words, the DOL has essentially told the retirement plan community where it plans to look next. Plan sponsors would be wise to make sure everything is in order before investigators come knocking.
