Compliance April 12, 2007

Court: Steelworker Misunderstands PBGC Benefit Rules

April 12, 2007 (PLANSPONSOR.com) - Just because the nation's private-sector pension insurer has a ceiling governing the maximum benefit it can pay to participants in plans it takes over doesn't mean that's what a particular worker is entitled to, a judge has ruled.
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U.S. District Judge Rudy Lozano of the U.S. District Court for the Northern District of Indiana issued the ruling in a suit by plaintiff George Dumas against the Pension Benefit Guaranty Corporation (PBGC) to force the agency to pay him the legal maximum monthly amount of $3,580.

Dumas was receiving $472 per month from LTV Steel Corp.’s pension plan when it was terminated on March 31, 2002 and then taken over by the PBGC. PBGC advised Dumas that he would continue receiving $472 per month.

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The plaintiff’s problem was that he just did not understand the PBGC’s operating rules, the court asserted. “The maximum insurance limitation is the maximum amount of a pension benefit that the PBGC may lawfully guarantee. It does not set the amount of benefits any one individual is entitled to earn,” Lozano said.

According to the court, nothing in the information provided by PBGC to Dumas suggested that he was personally eligible to receive the maximum monthly benefit paid by PBGC.

The case is Dumas v. Pension Benefit Guaranty Corporation,N.D. Ind., No. 2:05-cv-100, 4/9/07.

Products April 11, 2007

JPMorgan Puts Out Two Analytics Offerings

April 11, 2007 (PLANSPONSOR.com) - JPMorgan Worldwide Securities Services has released an investment manager scoring tool and a new system to explore different risk levels resulting from asset allocation or manager changes, according to the company.
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A JPMorgan news release said the two offerings are designed to help asset managers and pension and endowment fund executives achieve greater risk-adjusted returns.


According to the announcement, the two offerings include:

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  • Consistency Analysis, an investment manager scoring product for all asset classes. Managers are ranked based upon consistency of risk-adjusted performance.
  • Marginal Risk Analysis, a product that enables investors to explore different levels of risk and return. Clients will be able to use it to make incremental improvements to their portfolios in the attempt to increase returns and decrease risk.  

“Institutional investors are always looking for new ways to generate additional returns,” said Craig Heatter, head of JPMorgan’s Investment Analytics & Consulting (IAC), in the news release. “These new tools will help them optimize their investments by building in more consistency and testing new levels of risk. JPMorgan’s forward-looking analytical tools should assist clients in maximizing their alpha-producing strategies, as well as understand historical and future risk and return opportunities.”

JPMorgan IAC provides services globally to more than 200 clients with 6,500 portfolios and $1.5 trillion in assets. For more information go to  www.jpmorgan.com/visit/IAC .

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