The Federal Retirement Thrift Investment Board failed to adequately oversee the rollout of a new system for the Thrift Savings Plan, Washington, the Government Accountability Office said in a report.
The $912 billion Thrift Savings Plan, which serves as the retirement plan for federal employees and members of the uniformed services, is governed by the Federal Retirement Thrift Investment Board, or FRTIB. The FRTIB rolled out a series of new plan features in 2022, including an updated participant log-in interface; a mobile app and virtual assistant; the ability to sign documents electronically and complete transactions online; and the opening of a mutual fund window.
However, shortly after the rollout, participants voiced complaints about the updates, as many had trouble logging into their accounts or making transactions and experienced long customer service wait times.
“By not fully implementing (key acquisition management) practices, FRTIB significantly increased the risk of a problematic rollout of the new system,” according to the GAO report, dated Aug. 1.
Specifically, the GAO said the board did not develop policies governing the way it acquires products and services until after the rollout was underway; did not verify the contractor had completed planned tests; did not ensure the new system met federal requirements for loan repayment, court-ordered benefits and accessibility; did not ensure all milestones were met before progressing through the rollout; and did not verify requirements for personnel, such as training, background checks and contract monitoring.
Since the initial rollout, "participant-reported satisfaction with the modernized system has improved significantly since its deployment,” the GAO noted, though it suggests a series of recommendations for the FRTIB executive director.
The recommendations include to:
- “Develop a process to ensure that requirements developed for the TSP recordkeeping system are consistent with applicable federal requirements.”
- “Develop a process to review testing documentation to ensure planned testing is complete for any system enhancements or upgrades.”
- “Develop a process to review milestone-related documentation to ensure that it fully addresses the milestone requirement.”
- “Expedite negotiations with its contractor to modify, where feasible, the TSP services contract to ensure that all pertinent data necessary for performance oversight is provided by the contractor."
- “Reevaluate and adjust the allowable credits and penalties to focus on areas with the largest financial impact to participants.”
In June 2023, seven plaintiffs filed a class-action lawsuit against the board, as well as Accenture Federal Services and Alight Solutions, which the FRTIB hired to take over as the plan’s record keepers. The plaintiffs said the rocky rollout of the new system caused them financial hardship, and they charged the defendants with breaches of fiduciary duty, among other things.
FRTIB did not immediately respond to a request for comment.
