News in Brief
News in Brief: DOL Files Suits Against Benefit Plans

DOL Files Suits Against Benefit Plans
Labor officials allege the plan trustee failed to take responsibility for terminating the now-defunct company’s plans and distributing the assets to participants and beneficiaries after the company closed.
March 29, 2007
DOL Files Suits Against Benefit Plans

The U.S. Department of Labor announced Wednesday, March 28, that it has filed two lawsuits against the trustee of the benefit plans of the defunct Prime Care Services Inc. for failing to distribute $1.15 million in retirement assets to participants.

In a statement, labor officials said that the Southfield, Michigan, company failed to administer and terminate the company’s 401(k) plans and pension plan.

Labor officials are pushing for the money to be distributed to participants.

“Workers and their families counted on these benefit plans to help fund their retirement,” Secretary of Labor Elaine Chao said in a statement. “The department is seeking to have all the money in the benefit plans—more than $1.1 million—disbursed to the participants and beneficiaries.”

The suits allege that plan trustee Paterno Doreza, who was also the co-owner of Prime Care Services, failed to take responsibility for terminating the company’s plans and distributing the assets to participants and beneficiaries after the company closed its business.

As of November 30, the Prime Care Services Inc. 401(k) Savings Plan and Trust had $570,294.42 in assets and 77 participants. The Prime Care Services Inc. Money Purchase Pension Plan held $585,648.75 in assets and 64 participants.

Each suit seeks to appoint an independent fiduciary to manage the plan, terminate it and distribute assets to eligible participants and beneficiaries.

Filed by Lisa Shidler of Investment News, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

 









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