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Missing Participants Cause Concern for Plans


Recently, audits performed by the DOL and IRS have been focusing on retirement plans’ procedures for finding lost or missing participants. Lost or missing participants are individuals who do not have accurate contact information on file with the plan but are nevertheless entitled to benefits. Auditors will likely ask for records on deferred participants that are beyond the normal age of retirement. Those records may include the date election kits were mailed, the date paperwork was returned, the date payments started, and a log of any cashed or returned checks. Plans should keep accurate records of these items in order to be prepared for any future audit.

Additionally, auditors are often asking for documentation on how the plan has attempted to locate missing participants. Because of this, plans should have written procedures on how to locate a missing participant and should document those procedures as they are performed. At a minimum, plans need to have a procedure in place with the following steps to attempt to find missing participants: use certified mail for important correspondence; check related plan and employer records, such as health plan records or union records; check in with the beneficiary designated by the participant; and use internet search tools like search engines, public record databases, and social media.


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