The matter involves the PBGC's Special Financial Assistance Program designed to help struggling multiemployer pension plans. In December 2022, the PBGC awarded the Teamsters Central States, Southeast & Southwest Areas Pension Fund, Chicago, $36 billion in SFA funds, by far the largest award in the program's history.
A report issued in November from the Office of Inspector General for the PBGC found that in reviewing Central States' SFA application, the agency only required the pension fund to provide a list of all plan participants and proof of a search for deceased participants, known as a death audit. But the PBGC did not cross-check the information against the Social Security Administration's full Death Master File, which is the source recommended by the U.S. Government Accountability Office for reducing improper payments to deceased people, according to the report.
The PBGC OIG found 3,479 deceased participants in Central States SFA application, so when the amount of aid the plan would receive was calculated, it was inflated by about $127 million.
The Cassidy-Foxx bill would require the PBGC to verify past and future SFA applications by cross-checking plan participation lists against the full Death Master File, and would also require the PBGC to recoup from multiemployer plans any "ghost pensions the plans received," according to a news release.
"The complete and total lack of respect for hardworking taxpayer dollars is on full display with Democrats and the Biden administration," Foxx said in the news release. "Case in point, PBGC's gross negligence of sending $127 million in taxpayer money for dead teamsters and refusing to recover this money. I am pleased to introduce this legislation with Sen. Cassidy, so taxpayers get the accountability and oversight they rightfully deserve."
The PBGC in November issued a statement that said following a June white paper from the OIG, the agency promptly revised the application review process to require an independent death audit for all pending and prospective SFA applications.
Foxx earlier this month also sent a letter to PBGC Director Gordon Hartogensis with questions about the agency's review process.