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Release Date: June 21, 2006
Release Number: 06-1050-SAN (SF-67)
Contact Name: Deanne Amaden
Phone Number: 415.975.4741
San Francisco, California - The U.S.
Department of Labor has sued a Phoenix car repair business and its owner
for failing to deposit employee contributions into the company’s
401(k) plan.
Filed in U.S. District Court for the District of
Arizona, the suit alleges that Independent Import Services president Lee
Morris violated the Employee Retirement Income Security Act (ERISA) by
failing to remit employee contributions to the 401(k) plan and loan
repayments by participants that included $8,400 he personally borrowed.
“The Labor Department is committed to protecting
the benefits of America’s workers and retirees,” said Billy Beaver,
regional director in Los Angeles for the Labor Department’s Employee
Benefits Security Administration (EBSA). “We will not hesitate to act
to hold accountable those who misuse workers’ retirement assets.”
The suit seeks to recover $31,923 in unpaid
contributions plus lost earnings. The suit also seeks to remove Morris
as a plan fiduciary and permanently bar him from serving as a fiduciary.
It also seeks appointment of an independent fiduciary, at Morris’
expense, to terminate the plan and distribute assets to eligible
participants. Morris’ own plan assets would be used to help cover plan
losses, if necessary.
The violations occurred between December 2001 and
November 2003, when the firm stopped deducting contributions from
employees’ paychecks. The 401(k) plan served 16 participants and had
more than $120,700 in assets as of December 31, 2003. The case was
investigated by the EBSA regional office in Los Angeles.
In fiscal year 2005, EBSA achieved monetary results
of $1.7 billion related to pension, 401(k), health and other benefits
for millions of American workers and their families. Employers and
workers with questions or concerns regarding their private-sector
pension and health plans can contact the EBSA regional office in Los
Angeles at 626.229.1000 or EBSA’s toll-free number, 1.866.444.EBSA
(3272). Information is also available from the agency’s Web site at
www.dol.gov/ebsa.
(Chao v. Morris, et al.)
Civil Action No. CV06-1581-PHX-DGC
U.S. Department of Labor news releases are accessible on the
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page. The information in this news release will be made available
in alternate format upon request (large print, Braille, audio tape or
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placing your request at 202.693.7765 or TTY 202.693.7755. The U.S.
Department of Labor is committed to providing America's employers and
employees with easy access to understandable information on how to comply
with its laws and regulations. For more information, please visit the
Department's Compliance
Assistance page.
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