The U. S. Department of Labor has obtained a
consent order and judgment permanently barring Houston-based Administrative
Services of Texas (ASO) and its parent company from serving in a fiduciary
capacity to any employee benefit plan governed by Employee Retirement Income
Security Act (ERISA).
The court order also discharges Jack M. Webb as
the independent receiver to the plans and returns to certain contributing
employer all assets remaining after payments of plan expenses. The consent
order does not, however, resolve the departments allegations against Mark
A. Strange, a former corporate executive.
Previously, the department restored $737,636.19 in
plan assets held by Administrative Services of North American (ASONA) to
employers sponsoring the welfare benefit plans.
The Labor Department sued ASO, ASONO and Strange,
for allegedly using plan assets to pay the operating expenses of the two
corporations. Strange allegedly authorized the transfer of funds from plan
trust accounts to corporate accounts between October 1998 and March 1999.
A preliminary injunction obtained by the
department on June 11, 1999 froze the assets of the corporations to prevent
further depletion of plan assets owed to client plans managed by them.
ASONO and ASO served as third-party administrators
to self-funded employee welfare benefit plans sponsored by a variety of
employers.
This case resulted from an investigation conducted
by the Dallas Regional Office of PWBA into alleged violations of ERISA. The
consent order and judgment was entered on April 19 in federal district court in
Houston.
(Herman v. Administrative Services of North
America, Inc.) Civil Action No. H-99-1793 |