DOL sues employee benefit plan fiduciaries for over $2.8 billion

The Department of Labor has asked a federal court in Illinois to hold the fiduciaries of a multiple employer welfare arrangement, the United Employee Benefit Fund, along with its counsel, liable for more than $2.8 million in losses after an investigation found they allowed the misappropriation of the fund’s assets.

Chicago-based UEBF provides life insurance benefits to about 63 employer-sponsored benefit plans nationwide.

The Labor Department’s complaint alleges the fund’s fiduciaries and its counsel committed multiple violations of the Employee Retirement Income Security Act from 2015 to 2018.

Investigators allege violations by trustees Gary Meyers and John Fernandez, administrator David Fensler, trustee and service provider Herbert McDowell and his company United Preferred Companies Ltd. and fund counsel L. Steven Platt, who was employed by Chicago law firm Robbins, Salomon & Patt Ltd.

The ERISA violations cited included the transfer of $1.125 million of assets from the fund to buy McDowell’s house out of foreclosure, the transfer of $400,000 of assets to the lawyer representing McDowell in the foreclosure, and the transfer of $84,000 of assets directly to McDowell.

The complaint seeks to recover losses and interest, to bar the fiduciaries and counsel permanently from serving as fiduciaries and service providers to employee benefit plans, and to appoint an independent fiduciary to take over the administration of the fund, including conducting an accounting of all plan assets and determining whether the fund should be terminated.

[More: Next iteration of DOL fiduciary rule catalyzes lobbying blitz on Capitol Hill]

The post DOL sues employee benefit plan fiduciaries for over $2.8 billion appeared first on InvestmentNews.

Andrew is half-human, half-gamer. He’s also a science fiction author writing for BleeBot.

Andrew Vincent
Andrew is half-human, half-gamer. He's also a science fiction author writing for BleeBot.
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