401k Fraud

401ks hold trillions of dollars. A perfect place for scammers.

About 5 years ago, the Department of Labor (DOL) experimented with something new. It was a program to look for terminated employees who still had money in their old employers 401k plan. What they found, was that many employees had no idea that they had money in their old employers 401k plan.
Who does know that Americans have money in their old 401k plans?  Scammers!
In 2018, 1.4 million fraud-related cases were reported, according to a 2018 report from Javelin Strategy & Research.  Americans lost over $1.48 billion to scammers.  Not included in this $1.48 billion, is the additional millions that have been stolen from 401k plans. 
401k Recordkeeper, Great-West Financial, had 20 participants that lost millions of dollars due to fraud. In another case, a former employee of Estée Lauder had $99,000 stolen from her account by scammers.
In a court Pennsylvania court case, the court ruled that employers can be held liable when 401k accounts are hacked, and they can also be held accountable for inadequate security defenses. With so many former employees keeping their money in their old 401k, how are trustees, fiduciaries and recordkeepers to know whether a former employee is trying to get his/her money out of the plan or whether a scammer has forged a former employee’s name?
Here are some ways to detect if someone has forged a signature.
401k Plan trustees, should keep documents, like health insurance forms, tax forms, and other forms that have an employee’s signature on it. People are not robots and can’t sign the exact same way each time.  We have muscle memory and can sign similarly, but no two signatures are exactly the same. 
If you think that a signature has been traced or transferred from one document to another, hold the documents up to a window and place the real signature on top of the forged signature.  If they are identical, then someone traced or transferred the signature.  
If the signatures are similar but not exact, you will need to hire a Handwriting Expert.  Here is a directory of Handwriting Experts across the country.  https://www.handwritingexperts.com/



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