House GOP Pension Probe Widens Net to Include Labor Department

House Republicans are expanding their investigation into how the government’s private-sector pension insurer overpaid a Teamsters pension plan $127 million by counting dead participants to now include the US Labor Department.

Reps. Virginia Foxx (R-N.C.) and Bob Good (R-Va.) sent DOL Solicitor Seema Nanda a letter Thursday requesting documents and communications that could reveal the department’s role in helping the Pension Benefit Guaranty Corporation and its Trump-appointed director develop a legal strategy for denying Congress’ initial request to recover the funds.

Thursday’s letter signals House investigators are widening the scope of their inquiry since they subpoenaed PBGC in late March for information they say the independent agency wouldn’t hand over willingly. The involvement of other federal agencies suggests GOP ire over the special financial assistance bungle extends to the White House, especially since PBGC policy is set by multiple Biden-appointed officials.

House oversight authority “includes the Committee’s obligation to investigate how the Biden administration, whether acting through PBGC or SOL, is implementing the SFA program and to make legislative changes, as warranted,” the letter said.

The PBGC has been facing heat on Capitol Hill since late last year when it was first revealed that the agency had failed to cross-check Central States Pension Plan’s request for bailout funding with federal death records. President Joe Biden‘s American Rescue Plan Act wrote the agency a blank check to throw a lifeline to more than 200 of the country’s most severely underfunded union-brokered pensions.

Agency officials initially claimed the $127 million didn’t constitute an “improper payment” under the rules they set for themselves to allocate bailout funding. But PBGC Director Gordon Hartogensis changed his tune during a Senate oversight hearing in March, pledging to recover the Central States overpayment as well as extra money that was paid to any other plans.

Foxx, who chairs the House Education and the Workforce Committee, and Health, Employment, Labor, and Pensions Subcommittee Chairman Good are now seeking information from Nanda and the DOL Solicitor’s Office about the PBGC’s sudden about-face.

“The Committee understands that SOL could play a role in how PBGC responds to inquiries from Congress and the public,” the lawmakers wrote.

DOL issued a statement of enforcement policy on March 15 insisting that Central States and other plans that received overpayments return those funds. The memo said plans wouldn’t face any negative legal consequences for doing so.

Acting Labor Secretary Julie Su, meanwhile, serves on the PBGC’s Board of Directors alongside the secretaries of commerce and treasury. They play a vital role in setting the independent agency’s policy, and would have likely been closely involved in determining whether it would initiate a recovery.

“The Committee is interested in what advice and legal interpretations you and SOL have provided to PBGC regarding its legal authority to recapture these overpayments from both before and after DOL’s publication of its statement,” Thursday’s letter said.