After doing an anti-fraud campaign , the Department of Labor uncovered a fraction of employers who abuse the employees’ contribution plans for their own gain. The DOL has provided a list of red flags to watch out for in your own plan, so you can detect fraud early on:
- Your 401(k) or individual account statement is consistently late or comes at irregular intervals
- Your account balance does not appear to be accurate
- Your employer failed to transmit your contribution to the plan on a timely basis
- A significant drop in account balance that cannot be explained by normal market ups and downs
- 401(k) or individual account statement shows your contribution from your paycheck was not made
- Investments listed on your statement are not what you authorized
- Former employees are having trouble getting their benefits paid on time or in the correct amounts
- Unusual transactions, such as a loan to the employer, a corporate officer, or one of the plan trustees
- Frequent and unexplained changes in investment managers or consultants
- Your employer has recently experienced severe financial difficulty
