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Release Date: 07/13/2004
Release Number: 04-1295-NEW/BOS 2004-158
Contact Name: Gloria D. Della
Phone Number: 202.693.8664
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New York, New York - The U.S. Department of
Labor has obtained a partial consent judgment requiring a former trustee
of the money purchase plan of Arch-Con Associates in Whitestone, New York,
to restore $34,000 to the plan as restitution for failure to collect
employer contributions. Former trustee Paul Cohen, who was in bankruptcy,
has agreed to restore additional amounts up to approximately $183,000 in
unpaid employer contributions and interest if his finances improve. |
Cohen
also agreed to be permanently barred from serving plans governed by the
Employee Retirement Income Security Act in the future. In addition, the
department obtained an order preventing Cohen from discharging any debts
owed to the plan in bankruptcy proceedings. |
The
department sued trustees Joseph Bordonaro and Cohen on July 25, 2003, for
violating the Employee Retirement Income Security Act (ERISA) when they
failed to collect about $160,000 in employer contributions owed to the
plan by the company during 1997 to 1999, and abandoned the plan when
Arch-Con became defunct. The suit was filed in federal district court in
Central Islip, New York. In May 2003, the department also filed adversary
complaints against the defendants in U.S. bankruptcy courts in Central
Islip and Poughkeepsie, New York, to prevent them from avoiding payment of
money owed to the plan. |
Arch-Con
employed construction workers on job sites covered by prevailing wage
contracts with state and local governmental units in metropolitan New
York. |
“The law states that trustees have a fiduciary
responsibility to manage the money set aside in retirement plans for the
benefit of employees and their families,” said Francis Clisham, director
of the department’s New York regional office of the Employee Benefits
Security Administration (EBSA). “Our legal action begins to restore
money to pay future benefits to these plan participants.” |
The
case resulted from an investigation conducted by the EBSA’s New York
regional office. Employers and workers can contact the regional office at
212.607.8600 or EBSA’s toll free number, 1.866.444.EBSA (3272), for help
with problems relating to private-sector pension and health plans. |
(Chao
v. Bordonaro)
Civil Action No. 03-3643
(In re: Cohen)
Bankruptcy Case No. 02-37069 (CGM) |
U.S. Department of Labor
news releases are accessible on the Internet. The information in this news
release will be made available in alternate format upon request (large
print, Braille, audio tape or disc) from the Central Office for Assistive
Services and Technology. Please specify which news release when placing
your request. Call 202.693.7773 or TTY 202.693.7755. |