Gov. Watchdog Office To Review Oversight of Teamsters Pension Fund

The Government Accountability Office (GAO) will launch an examination of whether the U.S. Department of Labor could have prevented the funding crisis currently swallowing the Central States Pension Fund.

The Central States Pension Fund, the retirement fund of the Teamsters labor union, announced plans last year to significantly cut member benefits.

More from the Minneapolis Star Tribune:

The nonpartisan Government Accountability Office will review the U.S. Department of Labor’s oversight of the fund, the office wrote in a Feb. 12 letter to Sen. Chuck Grassley, R-Iowa. Grassley requested the probe Feb. 1.

“Plan beneficiaries deserve to have a better understanding of what led to the financial failings of Central States and ultimately put their retirement at risk,” Grassley said Tuesday.

“Congress needs to have a better understanding of what happened with the Department of Labor’s oversight of this pension plan so that any corrective actions, if necessary, can be taken.”

The Labor Department has monitored the giant ­Teamsters union retirement fund for more than three decades. Labor obtained a federal court-ordered consent decree ­following its own investigation of gross mismanagement of the fund and self-dealing by fund managers. Grassley said the consent decree gave Labor considerable oversight authority in choosing independent fund managers and changing investment strategies.

Yet the fund slid into crisis under Labor’s watch and is now more than $16 billion in the red. To the fury of retirees and workers, the fund is seeking to slash retirement benefits under the controversial Multiemployer Pension Reform Act of 2014.

The proposed cuts would affect over 250,000 Teamsters members.

Photo by  Bob Jagendorf via Flickr CC License