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Release Date: 10/13/1998
Release Number: NY
205
Contact Name: Gloria Della
Phone Number: 202.219.8921
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The U. S. Department of Labor has obtained a
consent judgment against the trustee of a pension and health plan of a
Hempstead, New York community service organization for mismanaging plan
assets |
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The plans provided retirement and health benefits
to employees of the Economic Opportunity Community (EOC), a nonprofit community
service program, through the Luenetta Miller EOC Retirement Benefit Program and
the Community Action Agencies Insurance Group for employees. |
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Under the judgment, John Kearse is permanently
barred from being a plan trustee and from doing business with any plan governed
by the Employee Retirement Income Security Act (ERISA). The judgment also
limits Kearse’s serving in a position of trust to any plan governed by
ERISA, communicating with officials of such plans and receiving compensation
from those plans. |
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A lawsuit, filed simultaneously with the judgment,
alleged that Kearse violated his duties as trustee to the plans by:
- investing retirement plan assets in low interest bearing
accounts of the CEDC Federal Credit Union whose credit committee Kearse served
on;
- failing to set up individual accounts for each participant and
to credit, in a timely manner, earnings to the accounts; and
- allowing pension and health plan assets to be used as
collateral on loans by the credit union to affiliated companies, including to
the sponsors of the retirement plan and the health plan.
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The judgment was approved on October 5 by the
federal district court in Brooklyn. This case resulted from an investigation
conducted by the New York Regional Office of the Pension and Welfare Benefits
Administration into alleged violations of ERISA. |
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(Herman v. Kearse)
Civil Action No. CV 98
5900 |
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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. |
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