NMI Retirement Fund May Recover $425,000 In Overpaid Benefits

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Overtime, compensation payments scrutinized carefully

By Alexie Villegas Zotomayor

SAIPAN, CNMI (Marianas Variety, May 2, 2012) – As the Northern Mariana Islands (NMI) Retirement Fund internal audit combs its records, the pension agency may potentially recover $452,000 in overpayments.

Fund internal auditor Lilian Pangilinan told the trustees, "Hopefully, right now we stand at potentially collecting $452,000."

During yesterday’s board meeting, Pangilinan also reported that the Fund had collected between Feb. 2010 to March 31, 2012 $237,520 for the underpayment of benefits.

She also reported that an update is forthcoming from the Fund on the progress of the negotiation with the former Commonwealth Ports Authority security officer.

As to the overpayment of $19,944.08 to one active employee, Pangilinan said the member has been advised that she will need to return the full amount in lump sum, "otherwise she will not be credited for the services she has served so far."

As discussed in previous board meetings, the employee who withdrew her contributions from the Fund never severed her employment and still continues to work and remains a member of the defined contribution plan.

The trustees were also informed yesterday that the member has yet to respond to the Fund’s letter.

[PIR editor’s note: Fund administrator Richard Villagomez has reiterated concerns that deficiencies and late payments from government and autonomous agencies are also impeding progress made by the Fund to recover. The public school system, utilities and development agencies are all currently named as owing payments to the Fund.]

As for other similar cases, Pangilinan said, "So far we have not come across anymore."

She also reported the completion of the preliminary audit of the overtime/compensatory time records.

"At this time we have still to finalize the computation methodology," she said.

She told the trustees that the Fund has to comply with the Attorney General’s opinion on how the overtime and compensatory time should be handled.

She informed the trustees of the difficulty in sorting out records of the previous years how much of the total earnings were for overtime and compensatory time.

It was also reported to the board that referring to W2 wouldn’t offer that much help to the Fund, because it doesn’t itemize the earnings as to base pay or OT or compensatory time.

"It’s just total wages earned," said Fund deputy administrator Esther Ada.

She also said for the internal auditors to get the exact amount for OT and compensatory time necessitates going per pay period and checking the amount for base pay and overtime.

What complicates this undertaking, for Ada, is some files are incomplete.

Based on their initial assessment, the auditors found out that there are a lot of OT comp-time recipients.

For Pangilinan, they are "tackling only the first 10 percent."

With OT/Comp Time recipients, Pangilinan said they are working in stages, beginning with those receiving the highest.

"What we are doing is we are computing what they should be earning versus what they were given," she said.

She added, "We are looking at that so we can adjust those immediately," she said.

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