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Release Date: June 28, 2006
Release Number: 06-984-CHI
Contact Name: Brad Mitchell
Phone Number: 312.353.6976
Minneapolis, Minnesota - The U.S. Department
of Labor filed suit today against Neupak Inc., its majority shareholder,
and its 401(k) plan fiduciaries to recover employee contributions and
loan repayments that they failed to forward to the workers’ 401(k)
plan.
The lawsuit, filed in the United States District
Court of Minnesota, alleges that Neupak Inc. owner/fiduciary Terrence
Roberts, and fiduciaries Jason Roberts and Nicholas Roberts violated the
Employee Retirement Income Security Act (ERISA). The defendants
allegedly failed to forward 401(k) plan contributions and loan
repayments withheld from seven employees’ paychecks for specific
periods during October 2003 through May 2004. The company was located in
St. Paul at the time of the alleged violations.
“The law requires plan fiduciaries to act
responsibly in managing money set aside for retirement plans for the
benefit of workers and their families,” said Steven Eischen, director
of the Employee Benefits Security Administration’s (EBSA) Kansas City
regional office. The Kansas City regional office investigated the case.
The suit seeks to require the defendants to repay all
contributions and restore all losses with interest owed to the plan. It
also asks the court to permanently bar the Roberts from serving as
fiduciaries to any plan governed by ERISA.
Employers with similar problems, who are not yet the
subject of an investigation by EBSA, may be eligible to participate in
the department’s Voluntary Fiduciary Correction Program (VFCP).
Participation in the VFCP requires employers to correct any violations
but allows them to avoid EBSA enforcement actions and civil penalties as
well as any applicable excise taxes. For more information about the VFCP,
see www.dol.gov/ebsa.
Employers and workers with questions or concerns
regarding their private-sector pension and health plans can contact the
EBSA regional office in Kansas City at 816.426.5131 or EBSA’s toll
free number, 1.866.444.EBSA (3272). 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.
(Chao v. Neupak Inc. et al)
Civil Action No. 0:06-cv-2612
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