First Your Home…Now Your Pension?

You can’t trust anyone or anything…

Except for my landscaper and my computer guru, this is my motto.

The front page article in last Sunday’s Press Democrat, System stymies mortgage fix simply reinforces my world view when it comes to banks and other financial institutions and their recent mortgage practices.

But for those who may not have mortgage woes, take no comfort.  You, too, may soon be subjected to the whims of financial institutions and insurance companies in other aspects of your life.

Consider this story from somewhere in Northern California as it may apply to you or someone you know…


You are retired. Note

You’re collecting your pension….perhaps for many years. Red rose

Then, one day you get a letter from the institution paying your pension saying: “Oops! So sorry, we miscalculated and have been overpaying you. Please forward $42,814.42 within 10 days.”  Storm cloud

Impossible, you think. Unfortunately, such tactics are becoming a common practice. Wilted rose

In a current local case, a 76 year old pensioner had been receiving a pension for 11 years until presented with an overnight letter on September 17, 2010, advising that she had been overpaid and she had 10 days to accept the repayment terms outlined in the letter.  What really adds spice to the story is that the pensioner is an advanced Alzheimer’s patient in an assisted living facility.  There are a lot of other very “interesting” facts associated with the story. I am holding them back until it matures further…also in the hope that the bank comes to its senses and I can drop it.

The Wall Street Journal recently published an excellent article detailing this new phenomenon of recalculating pensions and how some people are fighting back.  I recommend it to you. In fact, if you are currently receiving a pension, it is essential that you read it.  Click on ‘Overpaid’ Pensions Being Seized.

There are ways of resisting such claims for repayment. However, one needs to hire a lawyer familiar with ERISA (The Employee Retirement Income Security Act) and benefits law to negotiate and litigate.  In many instances, the pensioner can rightly claim equitable estoppel if they can prove that it was reasonable for them to rely upon the original representation of their pension amount.  

There are no guarantees, and frankly, I suspect many people will not realize that they need legal assistance, much less have the resources to hire a lawyer.  Notwithstanding, I think that lawyers may stand in line to take this one on…

Stay tuned…


3 thoughts on “First Your Home…Now Your Pension?

  1. I remember my father saying back in the 50s how important it was that my pension be vested. At that point, a pension was the least of my worries; but now…?

    • As you and I were in this business “back in the day” you will also recall that pension and benefit calculations were precise and double and triple checked. Can you imagine what would have happened to us if we screwed up the pension calculation?

  2. Pingback: Finials Fireworks Pensions & Photos « The Petaluma Spectator © Frank Simpson

Comments are closed.