Deals and People August 15, 2012

MassMutual Names Three Relationship Managers

August 15, 2012 (PLANSPONSOR.com) - MassMutual's Retirement Services Division continues to grow its client service team with the appointment of three new relationship managers.
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Eunice Cabrera has been promoted to senior relationship manager with MassMutual’s Retirement Services Division, effective June 30; John Andresen has joined as a director-level relationship manager, effective July 9; and Michael Gopen has joined the team as senior relationship manager, effective August 13.  

Based in Orlando, Florida, Cabrera serves on the south central region client management team, responsible for managing the division’s retirement plan business in the mid-market segment. She first joined MassMutual in 2003, and most recently served as a retirement education specialist responsible for the Florida, Georgia and Puerto Rico territories. Cabrera graduated from Boston University with a BS in Business Administration, holds her FINRA Series 6 & 63 licenses, and is bi-lingual. She reports to Brian Barrett, assistant vice president for MassMutual’s Retirement Services Division.  

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Based in Northern California, Andresen is responsible for managing large-market customers and reports to Tom Cremona, vice president for MassMutual’s Retirement Services Division. Prior to joining MassMutual, Andresen served two years with Smith Hayes as an investment consultant and registered investment adviser (RIA), and prior to that spent 10 years in benefits consulting and relationship management with Milliman. Andresen holds his BA in Psychology from the University of Nebraska, FINRA Series 7 & 63 licenses and several industry designations including Certified Pension Consultant (CPC), Certified Employee Benefits Specialist (CEBS) and Certified Retirement Services Professional (CRSP).   

Gopen is responsible for managing mid-market customers in the metro New Jersey/New York region. Based in Port Jefferson Station, New York, Gopen serves on the northeast region client management team, reporting to M. Palmer Whitney, assistant vice president for MassMutual’s Retirement Services Division. Prior to joining MassMutual, Gopen served as client relationship manager with Gallagher Retirement Services, a position he held since 2005. He graduated from Penn State University with a BS in Communication Disorders, and currently holds his NYS Life Insurance and FINRA 7, 6 and 63 licenses, as well as his Accredited Investment Fiduciary (AIF) designation.
Compliance August 15, 2012

PBGC to Begin Back Payments for United Airlines Retirees

August 15, 2012 (PLANSPONSOR.com) – The Pension Benefit Guaranty Corporation (PBGC) announced its completion of corrective work for United Airlines retirees’ pension amounts.
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The agency found that in 2008 it had undervalued United’s pension assets by about three-fourths of one percent. As a result, PBGC will increase slightly the benefits of some United retirees, and will be making back payments with interest to those who have already been underpaid.   

“Unfortunately, PBGC let the people of United Airlines down, but we’re determined to put things right,” said PBGC Director Josh Gotbaum. “We’ve gone back and redone the work. Anyone we’ve underpaid, by even a dime, is getting paid back with interest and an apology. And we’re making other changes so this doesn’t ever happen again.”  

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Two years ago, Congressman Miller raised concerns about PBGC’s handling of United pensions. The agency’s inspector general then found that the firm hired to value the assets had done a poor job, and that the agency had failed to supervise them (see “PBGC Admits to Problems Processing United Airlines Plans”).  

For the review of United Airlines’s pension assets, the agency hired KPMG. From that review it became clear that the original valuation had relied on the accounts furnished by the pension trustees, and that in a few cases those numbers were out of date, or were not adjusted to reflect the fact that PBGC was taking over the pension. After several reviews, PBGC determined that the United pension plans had been undervalued by about three-fourths of one percent ($58 million out of $7.3 billion). 

Most people were not affected by this error because, for most people, PBGC pays their full pension, and asset values do not affect their benefits. But asset levels do matter for those who earned a benefit above what the agency is legally allowed to pay. At United, less than one in five – or 18% of retirees – were affected by the change in asset estimates. For those who were shortchanged, in almost all cases it was less by than 1%. The agency said it has a policy of correcting all mistakes that reduce benefits – no matter how small – and making back payments with interest.  

More information about the PBGC’s review is at http://www.pbgc.gov/wr/bulletin/info/unitedfaq.html.

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