On Thursday, September 24, 2026, the Employee Benefits Security Administration (EBSA) held an educational webinar on what employers, plan sponsors, and fiduciaries can expect during a retirement plan investigation. Valerie Gatseman, Supervisory Investigator, and Thomas Leroe-Munoz, Senior Technical Advisor, presented the session. It focused on civil investigations of plans and service providers.
Here’s What You Really Need to Know
- Participant complaints drive most investigations, but not all of them. As of September 2026, complaints account for about half of all investigations. EBSA also opens cases through Form 5500 reviews, agency referrals, and other sources.
- Prohibited transactions and conflicts of interest are top priorities. EBSA listed several areas of interest but put particular emphasis on prohibited transactions and conflicts of interest.
- Documentation matters. Every investigation starts with a document review. EBSA stressed the importance of showing how decisions are made (i.e., prudent process) and who makes them.
How an Investigation Begins
Participant complaints are the most common trigger. EBSA also reviews Form 5500 filings for violations. It receives referrals from other agencies, such as the Securities and Exchange Commission and the Internal Revenue Service, and from news stories and service providers.
TIP! When a participant reaches out with a question, take it seriously and ensure prompt and accurate responses.
TIP! Don’t treat the Form 5500 filing as an administrative exercise; instead, treat it as an opportunity to ensure accurate reporting. Learn more by reading the latest Navigator resources on Form 5500 preparation.
What Is Under Review?
When it opens an investigation, EBSA generally looks at whether:
- Plan assets show any prohibited transactions or self-dealing
- Participants receive the required disclosures
- Everyone handling plan assets is bonded, as section 412 of the Employee Retirement Income Security Act (ERISA) requires
- The plan operates according to its plan document and follows the processes it has adopted (TIP! Ensure the plan has additional administrative processes and procedures in support of the plan document.)
- Employee contributions are remitted on time
- The plan keeps accurate, up-to-date records, including participant information
- Service providers are appropriately selected and monitored
- Investments are monitored, with documented reasons for choosing them
- Plan expenses and potential conflicts of interest are regularly reviewed
What Does an Investigation Look Like?
An investigation usually begins with a phone call from an investigator, unless EBSA is already working with the plan informally. An opening letter follows. It requests documents and schedules an onsite visit. Virtual visits are possible, but the agency calls onsite visits a “best practice.”
TIP! If you are unsure whether a call or letter is legitimate, contact your EBSA regional office and ask to be connected to the investigator.
Every investigation begins with a request for:
- Plan document and trust agreement
- Form 5500 filings (last three years)
- Summary Plan Description (SPD)
- Summary Annual Report (most recent year)
- Fidelity bond
- Fiduciary liability insurance policy, if any (not required)
- Trustee statements (last three years)
- Service provider contracts
- Meeting minutes
- Sample benefit statements
- Asset records
- Payroll and contribution records
Explore our Fiduciary File for a full list of documents plan fiduciaries should maintain for their plans.
EBSA may request more documents depending on the issue, the type of plan, and what comes up in interviews. It will also request records from service providers. Documents are typically due within 20 calendar days or 10 business days, but early communication with EBSA regarding any difficulty meeting the deadline can help plan sponsors receive additional time.
The onsite visit includes interviews with key personnel and fiduciaries. Topics include plan operations and service providers. Investigators also ask who is responsible for plan decisions, benefit payments, and plan expenses.
Key Areas of Investigative Emphasis
Fiduciary Responsibility, Conflicts of Interest, and Prohibited Transactions
Fiduciaries must act solely in the interest of participants and beneficiaries. They must act prudently and diversify plan assets, and follow the plan’s governing documents, to the extent those documents are consistent with ERISA. Fiduciaries may not act in their own interest, on behalf of a party with adverse interests or accept kickbacks for doing business with the plan.
TIP! The plan sponsor and the plan are separate legal entities and can be adverse parties. A decision that benefits the sponsor may not benefit the plan.
EBSA specifically mentioned its focus on conflicts of interest and prohibited transactions. Under ERISA, prohibited transactions are those transactions with parties-in-interest, which include the employer, union, plan fiduciaries, service providers, statutorily defined owners, officers, and relatives of parties-in-interest.[i] Examples of prohibited transactions could include a sale or lease between the plan and a party-in-interest, lending money between the plan and a party-in-interest, or furnishing goods, services or facilities between the plan and a party-in-interest.
Additionally, fiduciaries cannot use the plan’s assets in their own interest, act on both sides of a transaction involving the plan, or receive money from any party doing business with the plan in connection with that business.
There are exemptions, such as allowing the plan to hire a service provider (if necessary to operate the plan) and the compensation is “reasonable.”
The Department of Labor (DOL) can grant additional exemptions, but fiduciaries should be incredibly careful to make sure they meet all the requirements for the exemption.
Bonding
Anyone who handles plan assets must be bonded. EBSA says a person handles plan assets if they come into physical contact with cash, checks, or similar plan property,
have the power to transfer funds or negotiate plan property or supervise people who do either.
TIP! A fidelity bond is not fiduciary liability insurance. A bond covers fraud or dishonesty and must come from a surety approved by the Department of the Treasury.
Employee Contributions
Late remittance of payroll deductions is one of the most common issues EBSA sees. It usually comes to light through participant complaints. Contributions must go to the plan as soon as they can reasonably be segregated from employer assets. Plans with fewer than 100 participants have a safe harbor for deposits made within seven business days.
Reporting
EBSA checks that plans file complete Form 5500s on time. Late or incomplete filings result in significant penalties, which change from year to year. The Delinquent Filer Voluntary Compliance Program can reduce those penalties if the sponsor files before the DOL makes contact.
Cybersecurity
EBSA also referred to the DOL’s cybersecurity best-practices guidance.[ii] In particular, the agency highlighted the importance of cybersecurity practices in protecting participant benefits and information.
Protecting Benefit Distributions
EBSA highlighted several initiatives addressing benefit distributions:
- Terminated vested participants: Many former employees are still owed benefits they have not claimed
- Retirement Savings Lost and Found: A database that helps individuals find retirement savings from prior employers
- Distressed plan sponsors: When a plan sponsor is in financial distress, the plan is often neglected, and contributions, filings, and disclosures can all be missed
- Custodial abandoned plans: Some custodians lack procedures for abandoned plans. They may keep charging fees for services they are not performing
- Abandoned Plan Program: Offers a way to terminate an abandoned plan, distribute benefits, and make sure the termination complies with the law
- Retirement Asset Management: Examines section 404(c) plans and the conduct of 3(21) and 3(38) fiduciaries and investment advisors, including conflicts of interest in their investment choices.
Wrapping Up the Investigation
If EBSA finds no violations, it issues a closing letter stating that no violations were found. If it finds violations, the plan must correct them. Once the plan corrects the violations, EBSA issues a closing letter summarizing both the violations and the corrections. Common corrections include reversing prohibited transactions, restoring losses, and removing fiduciaries or service providers.
If the plan does not make corrections, EBSA may refer the case to the Solicitor’s Office for litigation. Criminal referrals are possible in some circumstances.
Action Items for Plan Sponsors
- Regularly audit your processes against the questions EBSA asks, as described above; pay particular attention to its areas of emphasis.
- Document fiduciary decisions, including how you monitor service providers and investments.
- Organize plan records so you can assemble the standard document request quickly.
- If your plan is investigated, communicate early and often with EBSA. The agency says clear, regular communication keeps the process efficient and allows investigators to more easily work with plans to resolve any issues.
[i] U.S. Department of Labor, Employee Benefits Security Administration, “Are Some Transactions Prohibited? Is There a Way to Make Them Permissible?,” elaws – ERISA Fiduciary Advisor, accessed September 25, 2026, https://webapps.dol.gov/elaws/ebsa/fiduciary/q4d.htm.
[ii] U.S. Department of Labor, Employee Benefits Security Administration, “Cybersecurity Program Best Practices,” accessed September 24, 2026, https://www.dol.gov/agencies/ebsa/key-topics/retirement-benefits/cybersecurity.