Archived News Release Caution: Information may be out of date.
|
Release Date: 10/17/2001 Release
Number: 147 Contact Name: Sharon Morrissey Phone Number: 202.219.8921 |
|
New York, New York - The owner of the Lawrence Group,
Inc.(LGI). a Schenectady-based holding company for insurance-related
subsidiaries, was ordered October 6 to pay the company's own 401(k) and three
health plans $334,220.34. As part of the restitution LGIs sole owner,
Albert Lawrence, was ordered to waive his own $170,000 balance in the 401(k)
plan and restore it to the plan. LGI previously settled with the Labor
Department. |
Lawrence also was barred permanently from serving
as a fiduciary to any employee benefit plan governed by the Employee Retirement
Income Security Act (ERISA). LGI's 401(k) plan had $9,490,756 in assets and 899
participants as of December 1995. In June 1997, the plan covered 350
participants, with assets of $8,123,000. |
The court actions resolve a lawsuit filed
December 18,
1997, alleging that LGI and Lawrence failed to promptly deposit employee
contributions into the company's plans. In October 1996, they stopped transferring
employee contributions to the savings plan and used plan assets for the
company. Lawrence also allegedly failed to forward loan repayments to the
savings plans until one or two months after the repayment amount was deducted
from employees paychecks, and he ceased forwarding loan repayments to the plan
at all in October 1996, allegedly also using these plan assets for the
corporation's benefit. |
In addition, Lawrence diverted employee
contributions to the company's other employee benefit plans to the
corporation's use. Misappropriated contributions included payments for
continuation of health care coverage under COBRA from former employees. During
1996 and 1997, Lawrence received $20,627 from former employees for COBRA
coverage and never remitted these amounts to the health plan or insurers. The
lawsuit also cited Lawrence for failing to forward his employee' salary
deferrals for dental plan coverage from October 1996 to April 1997. He paid only
$3,898 in claims toward accumulated dental claims amounting to $40,609.
|
In August 1997, the Secretary of Labor filed
proofs of claim in federal bankruptcy court to recover employee contributions
to the benefit plans from the debtor's estate. The Lawrence Group, Inc.,
several other Lawrence-related companies and Albert Lawrence filed for
bankruptcy on February 28, 1997. |
A previous judgment was obtained against LGI's
wholly owned subsidiary, Lawrence Health Care Administrative Services (LHAS),
in December 1999. LHAS administered some 127 employee benefit plans including
48 plans covered by ERISA. The administrator allegedly misused funds of 18 of
the ERISA plans to pay benefit claims on behalf of other clients including its
own firm, the Lawrence Group, Inc. |
The court actions resulted from an investigation
conducted by the Boston Regional Office of the Pension and Welfare Benefits
Administration. PWBA enforces the federal pension and employee benefit law. The
judgment and order were filed in federal district court in the Northern
District of New York in Albany. |
(Herman v. Lawrence Agency and Albert W.
Lawrence
Civil Action No. 97-CV-1853)
|
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. |
Archived News Release Caution: Information may be out of date.
| |
|