Compliance January 13, 2015

PBGC to Begin Requesting Pension Risk Transfer Information

The PBGC is revising its premium filing procedures to require reporting of pension risk transfer actions.
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The Pension Benefit Guaranty Corporation (PBGC) says it is revising the 2015 premium filing procedures and instructions to require after-the-fact reporting of certain defined benefit plan risk transfers through lump-sum windows and annuity purchases. The announcement was made in a request for Office of Management and Budget (OMB) approval filed in the Federal Register.   

The agency explains that risk transfers can substantially reduce the premiums plans otherwise would pay to the PBGC, and because premiums and the investment income earned on them are a major source of income for the agency, information about risk transfers is critical to its ability to assess its future financial condition. There is currently no available comprehensive, detailed, and reliable source for information about risk transfers.

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In September 2014, the PBGC gave public notice that it intended to submit the revised procedures and instructions to OMB for review. The agency said it received nine comment letters from representatives of employers, pension practitioners, annuity providers, and participants that focused almost exclusively on the new risk transfer items.

In its comment letter, the ERISA Industry Committee (ERIC) said plan sponsors can increase the strength and longevity of their DB plans through a variety of de-risking methods, and the PBGC, accordingly, should support the efforts of companies that continue to sponsor and/or administer defined benefit plans.

The agency said it has made changes to the revised premium filing items (both the questions and the instructions) in response to some of the comments. It is requesting comments on the revisions, to be submitted by February 11, 2015.

The new PBGC Participant and Plan Sponsor Advocate, Constance Donovan, earlier this month released her first annual report of issues, in which she said: “[P]ension de-risking may be the greatest threat to PBGC’s single-employer program, as it has the potential to substantially reduce PBGC’s premium base.”

Deals & People January 13, 2015

RBG Adds Southern California Team

Conor Weir and Sophois Sokhom have joined Retirement Benefits Group to provide retirement consulting services to clients in Long Beach, California.
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Weir will serve as a managing director and financial consultant. He is responsible for retirement plan design, participant advising, investment management, fiduciary risk management, business succession planning and planned giving. Before joining RBG, Weir built his practice at Merrill Lynch. Focusing on managing retirement plans during the last three years, Weir’s team accumulated approximately $60 million in client assets. Weir holds a bachelor’s degree in sociology and philosophy from Carleton College in Northfield, Minnesota, and a master’s of business administration with a concentration in finance from Oxford.

As director of client relations, Sokhom’s primary focus will be ensuring the firm’s clients receive the necessary expertise and attention to pursue their financial goals. Sokhom has extensive experience in risk management, insurance, annuities and financial planning from her diverse background at companies including Merrill Lynch, Robert Half Executive Recruiting and Andersen Consulting. She holds a bachelor’s degree in economics from Carleton College and a master’s of business administration with a focus in finance from the University of St. Thomas in Minnesota. She holds the certified financial planner (CFP), chartered retirement plans specialist (CRPS) and chartered retirement planning counselor (CRPC) designations.

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As well as managing a number of retirement plans, Weir and Sokhom serve as chief financial officer to families and business owners. Their team specializes in managing the overlap between business and personal wealth, managing retirement plans and helping individual clients plan for their own retirements. 

The decision to join Retirement Benefits Group stemmed from their desire to align the firm with one that is focused on retirement planning, Weir said in a statement, citing Retirement Benefits Group’s expertise and array of tools. “We will also benefit from additional freedom in terms of the providers we work with and methods in which we price plans,” he said.

Retirement Benefits Group is a network of retirement plan consultants with headquarters in Southern California and 13 affiliate offices nationwide.

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