Deals and People June 1, 2006

Snowbarger Retakes PBGC Top Spot

June 1, 2006 (PLANSPONSOR.com) - US Secretary of Labor Elaine Chao on Thursday tapped former US Representative Vincent Snowbarger as acting executive of the Pension Benefit Guaranty Corporation (PBGC).
Reported by

The latest appointment marks the second time Snowbarger will head the nation’s private-sector insurance program in an acting capacity. Chao also turned to Snowbarger in February 2004 after former PBGC head Steven Kandarian left his post. (See Ex-Kansas Congressman Named as Acting PBGC Chief ).

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Now, Snowbarger takes over for Bradley Belt who announced his departure in March and had his last day on the job Wednesday, the DoL said.

Snowbarger has served as the PBGC’s deputy executive director since November 2004. Additionally, Snowbarger served as the PBGC’s assistant executive director for legislative affairs from June 2002 until November 2004.

Compliance May 31, 2006

IRA Could be Tapped To Cover Criminal Fines

May 31, 2006 (PLANSPONSOR.com) - The US District Court for the Eastern District of Washington said in a memorandum opinion that an individual retirement account (IRA) could be considered part of a defendant's income, and might be used to cover a criminal fine.
Reported by

Defendant Terry Smith argued that under Washington law, his IRA is “exempt from execution, attachment, garnishment, or seizure by or under any legal process.” He also cited a US Court of Appeals decision that found only Employee Retirement Income Security (ERISA)-governed retirement funds can be used to cover criminal fines, which excludes plans that are not employee benefit plans.

The court had to decide whether a federal preemption to pay criminal fines overrode Washingtonlaw exempting    IRAs from garnishment.  

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In US District Judge Alan McDonald’s opinion , he wrote that “it is appropriate to consider the IRA funds as part of defendant’s income, earning capacity, and financial resources in determining whether to impose a fine.” The court found that, despite Washington’s exemption of IRAs, there was a “reasonable basis to believe” that Smith’s IRA could be used to settle the $5,000 fine.

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