Sec. 6. Enforcement and fraud prevention
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/bill/114/hr/6136/ih/section-6·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
If an employer is required under an automatic USA Retirement Fund arrangement to deposit amounts withheld from an employee's compensation into a USA Retirement Fund but fails to do so within the time prescribed under section 2(d)(3), such amounts shall be treated as assets of a USA Retirement Fund. A covered employer who fails to meet the requirements of section 2(a) for a calendar year shall be subject to a civil money penalty of $100 per calendar year for each employee to whom such failure relates.
No civil money penalty shall be imposed under this paragraph for a failure to meet the requirements under section 2(a)— during a period for which the Secretary determines that the employer subject to liability for the civil money penalty did not know that the failure existed and exercised reasonable diligence to meet the requirements of section 2(a); or the employer subject to liability for the civil money penalty exercised reasonable diligence to meet the requirements of section 2(a); and the employer provides the automatic USA Retirement Fund arrangement described to each employee eligible to participate in the arrangement by the end of the 90-day period beginning on the first date the employer knew, or exercising reasonable diligence should have known, that such failure existed.
In the case of a failure to meet the requirements of section 2(a) that is due to reasonable cause and not to willful neglect, the Secretary may, in the sole discretion of the Secretary, waive part or all of the civil money penalty imposed under this paragraph to the extent that the payment of such civil money penalty would be excessive or otherwise inequitable relative to the failure involved. The Secretary may prescribe and implement procedures for obtaining confirmation that employers are in compliance with subsection (a).
The Secretary, in the discretion of such Secretary, may prescribe that the confirmation shall be obtained on an annual or less frequent basis, and may use for this purpose the annual report or quarterly report for employment taxes, or such other means as the Secretary may deem advisable. Part 5 of title I of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1132 et seq. ) shall apply to a USA Retirement Fund as if a USA Retirement Fund were an employee benefit plan.
Section 502(a) of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1132 et seq. ) is amended— in paragraph (9), by striking ; or and inserting ; ; in paragraph (10), by striking the period at the end and inserting ; or ; and by adding at the end the following: in the event that an employer fails to make timely contributions or payments to a USA Retirement Fund established under title I of the USA Retirement Funds Act , by the Secretary, a participant, a beneficiary, or a fiduciary, to compel an employer to make such contributions or payments as if such contributions or payments were delinquent contributions or payments under section 515 or subsection (g)(2). .
Nothing in this section shall preempt State law insofar as State law relates to the enforcement of an obligation to contribute to a USA Retirement Fund. No person, in connection with a plan or other arrangement that is or purports to be a USA Retirement Fund, shall make a false statement or false representation of fact, knowing it to be false, in connection with the marketing or sale of such plan or arrangement, to any employee, any member of an employee organization, any beneficiary, any employer, any employee organization, the Secretary, or any State, or the representative or agent of any such person, State, or the Secretary, concerning— the financial condition or solvency of such fund or arrangement; the benefits provided by such fund or arrangement; the regulatory status of such fund or other arrangement under any Federal or State law governing collective bargaining, labor management relations, or intern union affairs; or the regulatory status of such fund or other arrangement.
Any person who violates this subsection shall, upon conviction, be imprisoned not more than 10 years or fined under title 18, United States Code, or both. The Secretary may issue a cease and desist (ex parte) order under this title if the Secretary determines that the alleged conduct of a fund purporting to be a USA Retirement Fund is fraudulent, or creates an immediate danger to the public safety or welfare, or is causing or can be reasonably expected to cause significant, imminent, and irreparable public injury.
A person who is adversely affected by the issuance of a cease and desist order under paragraph
(1)may request a hearing by the Secretary regarding such order. The Secretary may require that a hearing under this paragraph, including all related information and evidence, be conducted in a confidential manner. The burden of proof in any hearing conducted under subparagraph
(A)shall be on the party requesting the hearing to show cause why the cease and desist order should be set aside. Based upon the evidence presented at a hearing under subparagraph (A), the Secretary may affirm, modify, or set aside the cease and desist order at issue, in whole or in part. The Secretary may promulgate such regulations or other guidance as may be necessary or appropriate to carry out this subsection.
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Sec. 6
Enforcement and fraud prevention
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