The Ongoing Fight To Save The Central States Pension Fund!

Federal government should bail out Central States Pension Fund

Central States Pension Fund is projected to run out of money in 10 years.

Gregory Van Dress


· By Gregory Van Dress
President Teamsters Local No. 92 Retirees Club


Posted Jun. 25, 2016 at 7:17 AM

Editor's note: Greg Van Dress is a retired Teamsters official who worked for UPS from 1972 to 1994. He then was a business agent for Teamsters Local No. 92, where he also held various positions as an officer in the union. He retired in 2013 as secretary-treasurer of Local 92. Van Dress is related to the editor of The Independent.

Central States Pension Fund is a multi-billion dollar Teamster Taft-Hartley Fund started in 1955.

As a Taft-Hartley Fund, there is an equal number of trustees appointed by employers as well as by the union. Because the employer trustees were often from competing companies, the union effectively controlled the fund.

In the 1970s, when fund monies were invested in Las Vegas casinos with suspected mob connections, the federal government took notice. In the early 1980s, a consent decree was entered into whereby the U.S. Department of Labor would review and approve the fund's operation with oversight from the U.S. Treasury along with a yearly audit approved by a federal court. With all this oversight what could go wrong?

Plenty.

The Fund was started with a "sole purpose" of providing benefits to the participants. After the government takeover, there were billions of investment dollars available for financial advisers and Wall Street bankers, and because the advisers were approved, they could easily invest in whatever improved their personal situation.

Did they? Apparently.

Why would anyone invest in mortgage-backed bonds during the collapse of the housing market? Why would anyone invest in a bank in Iraq during a full-scale war? It certainly does appear that Central States' money was used to bail out Wall Street investors. This all happened with the federal government at the helm and without the approval or even the knowledge of the fund participants.

Worse yet, the fund paid for this investment "advice" to the tune of over $70 million for one year, according to the most recent Form 5500 available.

It gets worse.

The fund's executive director, Thomas Nyhan, spent millions in fund money to help push the Multi-Employer Pension Reform Act through Congress, permitting pension reductions for those already retired. (This was attached to the 2015 budget bill in December 2014 and passed without debate). Retirees received letters from the fund proposing pension cuts last fall. These cuts were not minor; some were up to 70 percent. Nyhan was rewarded with a pay increase of more than $30,000 to his over $600,000 annual salary. Even the fund's executive director had no problem lining his pockets while proposing to gut pensions.

I negotiated numerous work contracts while I was an officer for Teamsters Local 92. Employers had a limit on what they were willing to spend to get a contract but often didn't care how it was divided between wages, health insurance and pensions. Many times my Teamsters would sacrifice wages for an ERISA-protected pension increase. The Multi-Employer Pension Reform Act changed the guarantee — after workers retired.

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The Central States Pension Fund (CSPF) has been under unique circumstances. It has been under a Government Consent Decree since 1982. Under the Consent Decree the Department of Labor, and U.S. 8th. District Courts took over CSPF fiduciary duties receiving annual reports since 1982. The Department of Labor, and U.S. 8th. District Court responsibilities are manage, and supervise the fund, to appoint CSPF Wall Street Fiduciaries, CSPF Executive Director’s, and Fund Trustees. Under our Governments supervision, CSPF has lost over 11 Billion Dollars in 2008-2009, and over 20 Billion Dollars since 1982.


December 2014, Congress passed MPRA by slipping it into the must-pass omnibus spending bill. There was no public discussions or debate. MPRA was designed for CSPF and written by RandyG.DeFrehn, Executive Director (NCCMP), and Executive Thomas Nyhan (CSPF-NCCMP) using CSPF Attorneys. CSPF paid Washington Lobbyist over 6 Million Dollars to ensure this bill would pass giving CSPF the ability to cut CSPF Teamsters (Retirees) Pensions. The Employee Retirement Income Security Act of 1974, or ERISA, protects the assets of millions of Americans so that funds placed in retirement plans during their working lives will be there when they retire.


Knowing PBGC is underfunded, and predicted to be insolvent by 2025. Congress rushed to pass MPRA (Holiday Break was upon them, and in a rush to go home). Education and Workforce Committee only made this bill available to the Congress, and Senate to read only hours before the vote. When asked why their explanation was they knew this bill would not pass if it was voted on its own merit.

IMO Congress thought they fixed CSPF, and saved their Government Billions of dollars, saving PBGC from insolvency.


If the CSPF rescue plan would have passed and been implemented. Senior Citizens will lose their financial freedom… their buying power which will affect much more than just the Retiree and his family. Local communities, business, Schools, County, State and the Federal Government will also lose much-needed revenue… They depend on the tax revenue to fund their programs.…. Many will lose their homes, cars, won't be able to pay for their needed insurances, and cover their monthly obligations. They will be forced apply for assistance, costing their local, County, State, and the Federal Government to pick up the tab.


Multi-Employer Pension Funds directly affects over 10 Million people, and indirectly could affect the whole country, causing the next U.S. economic disaster.


Like it or not taxpayers will be affected, and paying for a corrupted Governments Greed. You will not have a choice!!!


There are not enough safeguards to protect Americans from our Government and Wall Street Corruption. Wall Street came after Senior Citizens, and Retirees Pensions first, thinking there will be no resistance.


IMO this is only the first attack from Congress, and Wall Street corruption. Between the Government, and Wall Street bankers they will be coming for your Social Security, 401(K), Roth, or any other retirement investments you may have.


Unfortunately, Congress is more concerned in their own best interest… Not their constituents!!!


Now the only statement I would agree with you on is “It does impact much more than the folks who were CSPF members”.