Source: U.S. Department of Labor (DOL)
A leading marketing and communications company based in White Plains, N.Y., and its president have been ordered to repay $1.5 million to the company's pension plan under a consent judgment resolving a U.S. Department of Labor lawsuit alleging violations of the Employee Retirement Income Security Act (ERISA).
"The department's legal actions will restore the pension plan's assets that these workers and their families have been counting on for their retirement," said U.S. Secretary of Labor Elaine L. Chao.
The company and its president were named as defendants in the suit, which was filedsimultaneously with the judgment. The company’s employee savings plan provided retirement benefits for 77participants as of December 2007. The defendant served as a trustee to the plan and was responsible for the proper management of its assets.
The defendant is alleged to have failed to remit more than $200,000 in employee contributions to the plan and to have transferred more than $996,000 in plan assets to the company's account. The suit also alleges that the company failed to monitor and prevent the misuse of plan assets, while knowingly receiving plan assets. The defendant has pled guilty to embezzlement and is currentlyserving a sentence of 57 months in prison.
This judgment was entered in the U.S. District Court for the Southern District of New York. An independent fiduciary agreed to by the parties must report to the court. In addition, the president is ordered to forfeit his own plan account as restitution and is barred permanently from serving as a fiduciary to any plan governed by ERISA.
The suit resulted from an investigation by the Labor Department's Employee Benefits Security Administration's (EBSA) New York Regional Office. Employers and workers can reach EBSA at 212-607-8600 or toll-free at 866-444-3272 for help with problems relating to private sector retirement and health plans. In fiscal year 2007, EBSA achieved monetary results of $1.5 billion related to pension, 401(k), health and other benefits for millions of American workers and their families.