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This Semiannual Report to Congress summarizes the activities and accomplishments of the Pension Benefit Guaranty Corporation (PBGC) Office of Inspector General (OIG) for the period April 1, 2008 through September 30, 2008. When accomplishing audit and investigative work, we ensure that it accords with our mission to be an independent and objective voice for Congress, the Board of Directors, and PBGC. We want to focus our work on the challenges facing PBGC and to be the primary source of timely and objective information for the organization.
We have designated five areas as PBGC's major management challenges: Governance, Stewardship, PBGC's Business Model, Information Technology, and Procurement and Contracting. The Business Model challenge relates to how PBGC programs can adapt to a changing environment to provide superior service and generate cost-savings. We plan audit and proactive investigative work to address these challenges. Significant audit and investigative activity this period includes:
- Governance—
We initiated an audit of PBGC’s implementation of its new investment policy. Our objectives are to (1) identify the strengths and weaknesses of PBGC’s approach to execution and (2) determine the effectiveness of PBGC’s plans to identify and manage key risks that could affect investment performance or limit anticipated benefits.
- Stewardship—
We investigated cases relating to the stewardship of PBGC assets, including a daughter who had been receiving her missing father’s benefits since 1993, a private sector actuary who falsely represented his professional status when certifying key documents, and an employee who forged his supervisor’s signature. We also assisted PBGC in recovering a misdirected premium check. In addition, we continued our focus on the annual financial statement audit and assisted in developing new audit follow-up guidance for PBGC.
- PBGC Business Model—
We continued our series of audits of terminated multiemployer plans which have administrative costs that are disproportionate to the benefits paid. We issued an audit of PBGC’s mass transit benefits and subsidized parking and made recommendations to correct internal control issues that could allow abuse.
- Information Technology —
In compliance with the Federal Information Security Act (FISMA), we conducted security reviews and other audits and evaluations of the effectiveness of PBGC’s information security program.
- Procurement and Contracting—
We issued a series of incurred cost audits that reported concerns such as PBGC contractors whose employees failed to meet minimum education and experience requirements and issues with the integrity of contractor timekeeping. An investigation disclosed that an employee had exceeded her authority and made an unauthorized commitment of funds.
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