2 days ago
The ESOP Association CEO James Bonham to Testify at Congressional Hearing on Restoring Trust at the DOL's Employee Benefits Security Administration
WASHINGTON--(BUSINESS WIRE)--James Bonham, President and CEO of The ESOP Association, has been invited by U.S. Rep. Tim Walberg, Chair of the House Education & Workforce Committee, to provide testimony at a subcommittee hearing titled 'Restoring Trust: Enhancing Transparency and Oversight at EBSA.'
'EBSA's anti-ESOP bias is well documented and a serious threat to ESOPs, plan participants, and fiduciaries."
Bonham will address the longtime systemic anti-ESOP bias at EBSA, how abusive investigative practices have caused a chilling effect on ESOP formation in contravention of Congress's bipartisan intent, and how Congressional action and oversight can help curb such abuses.
Bonham will specifically highlight the practice of secret common interest agreements, where taxpayer resources are used to subsidize private law firms and plaintiffs' attorneys' class action lawsuits against employee benefit plan sponsors and fiduciaries. The ESOP Association has been concerned by these agreements for some time, which were first brought to light in an ESOP case currently under litigation. The DOL Inspector General announced an investigation into the matter last month. Bonham will also share concerns about never-ending investigations, indiscriminate 'dragnet' style investigative tactics, and EBSA's continued practice of regulation by litigation that has led to arbitrary and capricious enforcement of unwritten rules.
'EBSA's anti-ESOP bias is well documented and a serious threat to ESOPs, plan participants, and fiduciaries. Members of Congress want to see employee ownership flourish in the United States, but this is deeply curtailed by EBSA's practices,' said Bonham. 'The ESOP Association thanks Education & Workforce Chair Tim Walberg and Subcommittee Chair Rick Allen (GA) for holding this hearing and allowing these concerns to be raised publicly and on the record, and we urge the Congress to take the necessary action to protect the future of ESOPs and employee ownership.'
There are currently two bills pending action in the Education & Workforce Committee that would serve to create greater accountability at EBSA. The EBSA Investigations Transparency Act (HR 2869), introduced by Rep. Lisa McClain (MI), would require EBSA to submit an annual report to Congress on the status of open investigations. The Balance the Scales Act (HR 2958), introduced by Rep. Michael Rulli (OH), would require EBSA to disclose all common interest agreements it has entered into. The ESOP Association strongly supports both bills, and its advocates made these issues a priority during the Association's annual ESOP Advocacy Day on Capitol Hill in May.
About The ESOP Association
The ESOP Association is the largest organization in the world supporting employee-owned companies, the more than 10 million U.S. employees who participate in an ESOP, and the professionals who provide services to them. Headquartered at the International Employee Ownership Center in Washington, DC and operating as a 501(c)6 organization with the affiliated Employee Ownership Foundation, The ESOP Association conducts and funds academic research, provides more than 160 annual conferences and events attended by nearly 15,000 individuals, and advocates on behalf of employee owners and their businesses to federal and state lawmakers.
