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Release Date: 03/28/2001 Contact Name: Sharon Morrissey Phone Number: 202.219.8921 |
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Two Colorado officials agreed March 21 to restore
$17,125 to the 401(k) pension plan of the now defunct JRMK Companies, Inc. of
Denver and to terminate the plan when all court-ordered conditions are met.
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Milton Karavites and Jon Reed allegedly violated
the Employee Retirement Income Security Act (ERISA) when they failed to forward
participant contributions and loan repayments to the plan. The consent order
requires Karavites and Reed to restore funds, including lost opportunity
interest, offsetting their own accrued benefits with the plan and
redistributing the money to 14 other plan participants. |
The Department of Labor lawsuit, filed
simultaneously with the consent order, alleged the defendants retained
employees' payroll deferred contributions and loan repayments intended for the
plan's account. Their actions caused the plan to make an extension of credit to
JRMK, the plan administrator. Karavites and Reed were 50 percent owners of JRMK
and plan fiduciaries. Karavites is the sole trustee of the fund. |
The plan was created on April 1, 1993, to
supplement participants' incomes at retirement and to provide benefits in the
event of death, disability or termination of employment prior to normal
retirement. The plan had 52 participants, including the defendants, and total
assets of $1,079,606 as of December 31, 1998. JRMK, doing business as CMP Mortgage,
originated mortgage loans. |
"Our goal is to assure that consumers know the
department is only a phone call away to help protect the benefits promised by
employers," said Gregory Egan, director of the Kansas City,
Missouri Regional Office
of the department's Pension and Welfare Benefits Administration, which
conducted the investigation. "Employers and workers can reach us at
816.426.5131 for help with any problems relating to pension and health plans
provided in the private-sector." |
The consent judgment was entered March 21 in
federal district court in Denver. The lawsuit was filed on
February 28,
2001. |
(Secretary of Labor v. Milton Karavites and Jon
Reed Civil Action No. 01-S-0357) |
Issued at Denver Office, Public Affairs,
Department of Labor, 1999
Broadway, Suite 1640, Denver, Colorado 80202-5716. |
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 202.693.7775. |
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