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Release Date: May 9, 2006
Release Number: 06-349-BOS/BOS 2006-133
Contact Name: John M. Chavez
Phone Number: 617.565.2075
Boston, Massachusetts - A major owner of
Payroll Benefits Inc., Auburn, Maine, agreed to make restitution of more
than $125,000 to 18 pension plans administered by the firm. Robert
Montgomery, who owned 49% of the company, agreed to the court order to
settle a lawsuit filed by the U.S. Department of Labor.
“Those who manage workers’ retirement plans have
a legal responsibility to properly manage and protect the funds
entrusted to them,” said Ann L. Combs, assistant secretary of labor
for employee benefits security. “When they fail to meet their
responsibilities, the Department of Labor will not hesitate to step in
to ensure that workers are paid the benefits they are promised.”
Montgomery was responsible for administering the
assets of the pension plans between February 1998 and early 2001. The
suit alleged that he violated the Employee Retirement Income Security
Act (ERISA) when he was delinquent in forwarding plan contributions to
designated investment funds; did not keep accurate records regarding
individual accounts, and furnished delinquent and inaccurate benefits
statements to the plans’ participants. Montgomery, who acted as an
investment advisor to plan participants, also allegedly received
undisclosed commissions in connection with the investment of the plans’
assets.
The judgment prohibits Montgomery from service as a
fiduciary to any employee benefit plan governed by ERISA for five years
and orders him to pay $125,012.46 in restitution to participants of the
pension plans he administered.
The legal action resulted from an investigation
conducted by the Boston regional office of the department’s Employee
Benefits Security Administration (EBSA). In fiscal year 2005, EBSA
achieved monetary results of $1.7 billion related to the pension,
401(k), health and other benefits for millions of American workers and
their families.
Employers and workers can contact the Boston regional
office at 617.565.9600 or EBSA’s toll-free number, 1.866.444.EBSA
(3272), for more information on the requirements of ERISA or for help
with problems relating to private-sector pension and health plans.
Additional information can be found at www.dol.gov/ebsa.
(Chao v Robert Montgomery)
Civil Action Number: 06-55-B-W
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