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Release Date: August 5, 2008
Release Number: 08-1037-NEW/BOS 2008-222
Contact Name: John M. Chavez
Phone Number: 617.565.2075
New York – The U.S. Department of Labor has
sued in the U.S. District Court for the Eastern District of New York to
obtain appointment of an independent fiduciary to oversee the abandoned
401(k) plan of defunct Freedom Security Systems Inc. of New Hyde Park,
New York.
The Freedom Security Systems Inc. 401(k) Plan was
sponsored by the company until it ceased operations around August 2006.
At that point, Ilene Maggio, the last known fiduciary of the plan,
stopped performing her duties without ensuring the appointment of a new
fiduciary to oversee distribution of the plan’s assets.
As a result, former employees were unable to access
their 401(k) accounts. Under the Employee Retirement Income Security Act
(ERISA), employee benefit plans must be managed by named fiduciaries. In
the absence of a plan fiduciary, participants and beneficiaries cannot
obtain plan information, make investments or collect retirement
benefits.
The Labor Department’s suit asks the court to
appoint an independent fiduciary to administer the plan, distribute its
assets to participants and beneficiaries, and oversee the plan’s
termination. American Funds is custodian of the plan’s funds, which
were valued at approximately $369,440.75 as of December 11, 2006, the
latest data available.
“We want workers to know that they can turn to the
Labor Department for assistance when they find themselves in this type
of situation,” said Jonathan Kay, regional director in New York City
for the Labor Department’s Employee Benefits Security Administration (EBSA).
“We took this legal action to ensure that the plan is properly managed
and its participants gain access to their retirement assets.”
The suit resulted from an investigation by EBSA’s
regional office in New York City. Employers and workers can contact the
office at 212.607.8600 or toll-free at 866.444.3272 for help with
problems relating to private sector pension 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. Additional information can be found at
www.dol.gov/ebsa.
Chao v. Freedom Security Systems Inc. 401(k) Plan
Civil Action Number: 08-CV-3146
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placing your request at 202.693.7828 or TTY 202.693.7755. The Labor Department is committed to providing America's employers and
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