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Release Date: 11/17/1998
Release Number:
V-3070
Contact Name: Rita Ford
Phone Number: 202.219.8921 |
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The U.S. Department of Labor filed a lawsuit in Chicago, Ill.,
against Lexington Securities, Incorporated, and its plan fiduciary Paul Maton
for withholding $12,608.65 of voluntary employee plan contributions in
violation of the federal pension law. The Lexington Savings Incentive Plan was
established on Feb. 1, 1995, as a cash or deferred profit sharing
plan. |
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The lawsuit alleged that during the period between May 1, 1995,
through June 31, 1995, Lexington Securities, Incorporated withheld voluntary
contributions from employees’ paychecks but failed to deposit them in the
plan’s investment accounts. The contributions were held, instead, in the
general assets of the corporation. It also alleged Maton allowed the
corporation to retain the voluntary employee contributions and failed to ensure
that they were deposited in the plan’s investment accounts. The savings
incentive plan was also named as a defendant in the case. |
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The defendants’ actions violated provisions of the Employee
Retirement Income Security Act (ERISA) that prohibits either direct or indirect
transactions between an employee benefit plan and any related party in which
the party benefits at the expense of the plan participants. |
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The lawsuit seeks to restore to the plan all losses incurred as a
result of the defendants’ breaches; requires the plan to offset defendant
Maton’s individual plan account against the amount of losses, including
lost opportunity costs, resulting from his fiduciary breaches; requires Maton
to undo any prohibited transactions in which he engaged or for which he is
liable; and permanently bars Maton from serving as a fiduciary to any ERISA-
covered employee benefit plan. |
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The lawsuit resulted from an investigation by the Chicago Regional
Office of the Pension and Welfare Benefits Administration into violations of
ERISA. The lawsuit was filed Nov. 10, 1998, in the federal district court in
Chicago, Ill. |
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Herman v. Lexington Securities, Inc.
Civil Action No.
98-C-7180 |
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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 202.693.7755. |
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