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William David Dickinson of Waterport, New
York, has agreed to plead guilty to a one count criminal information
regarding the misuse of employee pension funds in violation of the Employee
Retirement Income Security Act (ERISA), which is administered by the U.S.
Department of Labor.
According to James Benages, regional director for
the Labor Department’s Pension and Welfare Benefits Administration in
Boston, Dickinson was president of Geoguard Corporation of Medina, New
York. He also served as administrator of the company’s 401(k) pension
plan. From May 1996 through October 1997, Dickinson knowingly failed to
transmit $25,276.06 in employee 401(k) plan contributions to the
corporation’s pension plan, and instead used the money for other business
purposes. As a result of these actions, he also failed to comply with reporting
and disclosure requirements under ERISA.
Under the plea agreement negotiated by the United
States Attorney for the Western District of New York, Dickinson faces a maximum
possible sentence of one year in prison, a fine of $100,000, or both, as well
as a term of supervised release of up to one year. Sentencing is scheduled for
December 14, 1999, in the United States District Court for the Western District
of New York. The plea agreement also requires Dickinson to make restitution to
the employee pension plan of $4,579.05, which represents the total interest
that the withheld 401(k) employee contributions would have earned had they been
properly remitted to the plan.
Benages noted that ERISA governs the
administration of several types of employee benefit plans, including pension
plans, 401(k) plans, and health insurance plans. Said Benages, “The law
has very strict requirements governing the administration of employee benefit
plan funds. It is unthinkable that an employer would deduct 401(k)
contributions from employee paychecks and then use that money for their own
purposes rather than depositing it into the pension plan. Needless to say, this
type of criminal behavior can not and will not be tolerated.”
The plea agreement was signed by Dickinson on
September 13, 1999. Benages indicated that the criminal prosecution of the
defendant was initiated as the result of an investigation conducted by the
Pension and Welfare Benefits Administration office headquartered in Boston,
Mass. |
