FEDERAL RETIREMENT THRIFT INVESTMENT BOARD 

MINUTES OF THE MEETING OF THE BOARD MEMBERS 

July 25, 2023 

Michael F. Gerber, Chair of the Federal Retirement Thrift Investment Board, 

convened a meeting of the Board members on July 25, 2023, at 10:00 a.m., Eastern 

Daylight Time. The meeting was held at the Board’s offices at 77 K Street, NE and was 

open to the public via teleconference. In attendance were Dana K. Bilyeu of Oregon, 

member; Leona M. Bridges of California, member; Stacie Olivares of California, 

member (by telephone); Ravindra Deo, Executive Director; Stefanie George, Acting 

General Counsel and Acting Secretary; Suzanne Tosini, Chief Operating Officer, 

Deputy Executive Director, and Acting Chief Financial Officer; Kimberly A. Weaver, 

Director, Office of External Affairs; James Courtney, Director, Office of Participant 

Experience; Sean McCaffrey, Chief Investment Officer; and Vijay Desai, Chief 

Information Officer. 

Welcome. 

Chair Gerber called to order the monthly meeting of the Federal 

Retirement Thrift Investment Board (FRTIB or Agency) at 10:00 a.m. 

1. Approval of the Minutes of the June 27, 2023, Board Meeting Minutes. 

Chair Gerber entertained a motion for approval of the minutes of the June 

27, 2023, Board meeting. The following motion was made, seconded, and adopted 

without objection: 

MOTION: That the minutes of the Board meeting held on June 27, 2023, 

be approved. 

2. Monthly Reports. 

a. Participant Activity Report 

Mr. Courtney reviewed the monthly Participant Activity Report. See “Thrift 

Savings Fund Statistics June 2023” (attached). He reported that although a relatively 

small number of participants purchased an annuity in the first half of this year, the dollar 

amount used to purchase annuities is approaching the total amount put towards 

annuities in all of 2022. This increase is likely due to the increased interest rate index 

over the past 12 to 18 months. Hardship withdrawals for May and June were the highest 

since August of 2022. The increase could be seasonal, given similar elevations over the 

past three summers. Private sector plans have also seen increases in hardship 

withdrawals this year. 
 

In response to a question from Member Bilyeu, Mr. Courtney stated that 

the Agency is about to begin the process to recompete its annuity provider contract, and 

the Agency will investigate ways to make annuities more attractive to participants. 

b. Legislative Report 

Ms. Weaver began by noting that the House of Representatives passed its 

version of the Fiscal Year 2024 National Defense Authorization Act with no provisions 

affecting the TSP. She expects the Senate will complete its version of the bill this week 

before going out of session. The House will go out of session July 28 and return 

September 12, 2023, and the Senate will also go out of session July 28 and return on 

September 5, 2023. This means the House and Senate will have 12 and 17 days in 

session, respectively, in September to pass appropriations bills for FY24. 

3. Quarterly Reports. 

a. Investment Review 

Mr. McCaffrey presented the Investment Review, covering monthly 

investment performance for the managers relative to the benchmarks. See “June 2023 

Investment Program Review” (attached). 

For the month of June, BlackRock’s performance for the F, C, and S 

Funds matched the performance of the Funds’ indices. Performance for the I Fund fell 

behind the International Index by five basis points, primarily due to fair value pricing. 

State Street’s June performance for the F, C, and S Funds also matched 

the indices. Its I Fund performance exceeded the International Index by 29 basis points, 

primarily due to fair value pricing. 

Investor sentiment for stocks was more bullish in June, supported in part 

by the debt impasse resolution coupled with some recent economic data. The C and S 

Funds rose significantly. The I Fund also finished higher, propelled in part by a weak 

U.S. dollar. Higher market interest rates contributed to a loss for the F Fund, and all L 

Funds finished higher for the month. 

Mr. McCaffrey also reported that BlackRock’s year-to-date performance 

for the F Fund was ahead of the Fixed Income Index by 19 basis points due primarily to 

a difference in the timing of year end pricing for the index versus the manager’s pricing. 

Its performance for the C Fund matched the Large Cap Index. The S Fund 

outperformed the Small Mid Cap Index by ten basis points primarily due to securities 

lending. BlackRock’s I Fund performance exceeded the International Index by 47 basis 

points primarily due to tax advantage. 

For State Street’s year-to-date performance, the F Fund was ahead of the 

Fixed Income Index by 19 basis points primarily due to the same end-of-year pricing 

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difference mentioned previously. C Fund performance matched the Large Cap Index. 

Their S Fund performance exceeded the Small Mid Cap Index by three basis points 

primarily due to securities lending. Performance for the I Fund was ahead of the 

International Index by 66 basis points, primarily due to tax advantage and fair value 

pricing. 

 Mr. McCaffrey reported that equity markets were positive in July so far. 

Through the close on Monday, July 24, 2023, the C Fund is ahead 2.41 percent, the S 

Fund is ahead 4.07 percent, and the I Fund has gained 1.87 percent. In fixed income, 

the F Fund is ahead by 0.09 percent and the G Fund has earned 0.26 percent. 

L Fund participation continues to grow as expected, primarily due to 

automatic enrollment. During June, the number of participants holding at least one L 

Fund grew by approximately 30,000. In addition, approximately 2.1 percent of 

participants moved assets between funds. Assets primarily flowed out of the G Fund 

and into the C Fund, which is likely because of the significant rise in stock values both 

for the month and year-to-date. 

An audit of BlackRock’s proxy voting found no exceptions to established 

guidelines during the first quarter of 2023. Similarly, an audit of State Street’s proxy 

voting found no exceptions to State Street’s established guidelines during the same 

quarter. 

Regarding class actions, Mr. McCaffrey reported that BlackRock began 

the first quarter with 110 open class action claims. Thirteen new claims were opened, 

and eight claims were closed due to administrator action: three in the C Fund, four in 

the S Fund, and one in the I Fund. In the S Fund, 14 claims were settled for a total of 

almost 3,500,000 dollars. At the end of the quarter, 101 claims remained open. 

State Street began the first quarter with eight open claims. One claim was 

opened in the C Fund and three claims were opened in the S Fund. Two claims in the S 

Fund were closed due to administrator action, and 10 claims remained open at the end 

of the quarter. 

In response to a question from Member Bilyeu, Mr. Deo stated that the 

Agency will investigate whether there are patterns to the participants who are opting out 

of automatic enrollments. 

b. Budget Review 

Ms. Tosini provided the quarterly budget update. See “FY 2023 3rd 

Quarter Budget Review” (attached). The Agency has executed 95 percent of its third 

quarter targeted budget and 82 percent of its annual budget for the year-to-date. This is 

consistent with past years. The majority of the Agency budget is directly participantfacing, which includes recordkeeping, communications, and most of the personnel 

expenses. Ms. Tosini then showed the Board how the approved budget compares with 

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average assets over several fiscal years, as well as the gross and net administrative 

expenses for calendar years 2018 through 2022. 

c. Audit Status 

Ms. Tosini provided the quarterly audit status update. See “Quarterly 

External Audit and Remediation Status July 2023” (attached). The Agency has 14 

external audits either completed, underway, or planned for 2023. The Agency has 

completed two audits so far; however, most of the audits in progress are nearing 

completion. Over the past quarter, the Agency closed 47 audit findings. Three fourths of 

these closures resulted from finishing the decommissioning process after moving TSP 

recordkeeping operations to Converge. 

The Agency manages audit findings and closures in two tracks: the official 

track, which is based on the auditors’ determination, and the operational track, which is 

the actions the Agency has taken to close findings and its progress related to that effort. 

The numbers for the two tracks diverge primarily due to the gap between when the 

Agency takes actions to close findings and when the auditors next evaluate them. Ms. 

Tosini expects both the open and closed numbers in Fiscal Year 2023 to increase. 

Finally, she highlighted the 91 percent decrease in open audit findings over the past six 

years, resulting from considerable effort by Agency staff. 

4. Internal Audit Update. 

Ms. Barbara Holmes, Chief Audit Executive, provided the internal audit 

update. See “Internal Audit Update” (attached). The Agency has completed the death 

benefit oversight audit and the insider threat audit. The TSP fraud risk oversight audit is 

about 85 percent complete. The Agency is currently engaged in the fieldwork for the ETravel audit. The annual Federal Information Security Modernization Act (FISMA) audit 

is complete, and the Agency has received a draft report from the external auditors. The 

final scores for the FISMA audit will be released by the end of this week and the Board 

will be briefed on the 2022 and 2023 FISMA results at the next Board meeting. 

Last year the Agency conducted an audit of its Insider Threat Program. 

This year’s audit focused on the effectiveness of controls established last year. The 

scope was calendar year 2022. There were no Notices of Findings and 

Recommendations (NFRs) issued with this audit; however, there were several 

recommendations for management’s consideration. 

The Agency conducted an audit of the death benefit oversight process 

from June 2022 to May 2023. There were two NFRs for this audit. First, the audit found 

that Accenture Federal Services (AFS) has not provided sufficient access to the 

surveillance data for death benefit cases they have processed. Second, AFS death 

benefit processing lacks a robust secondary-level quality assurance review. In response 

to a question from Chair Gerber, Ms. Holmes clarified that surveillance data is the data 

from AFS that the Office of Participant Experience (OPE) reviews in order to oversee 

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the contract, and at the time of this audit, OPE did not have sufficient rights to view all 

the data. 

Ms. Holmes and her team continue to review the file plans for each office. 

The Office of the Chief Financial Officer file plan review is about 90 percent complete 

and then the Office of Resource Management will be the last review to complete the 

project. Other internal audit activities include updating the internal audit policy and 

procedure, planning for upcoming audits, and developing the audit plan for 2024 and 

2025. 

5. Adjourn. 

Whereupon there being no further business, the following motion was 

made, seconded, and adopted without objection and Chair Gerber closed the meeting 

at 10:20 a.m. to enter into executive session. 

At 3:08 p.m., upon completion of the executive session, the members 

reconvened the open portion of the meeting. 

Whereupon, there being no further business, the following motion was 

made, seconded, and adopted without objection and Chair Gerber adjourned the 

meeting at 3:08 p.m. 

MOTION: That this meeting be adjourned.

 Stefanie George 

 Acting General Counsel and Secretary 

Attachments 

1. Thrift Savings Fund Statistics June 2023 

2. June 2023 Investment Program Review 

3. FY 2023 3rd Quarter Budget Review 

4. Quarterly External Audit and Remediation Status July 2023 

5. Internal Audit Update 

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