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Release Date: 12/08/1998
Release Number: USDL
219
Contact Name: GLORIA DELLA
Phone Number: 202.219.8921
Contact
Name:DEANNE AMADEN
Phone Number: 415.975.4741 |
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The San Francisco investment firm of McMorgan and Co. has paid
more than $13.7 million, including interest, to 10 pension plans as part of a
negotiated settlement, the U.S. Department of Labor announced today. |
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The settlement stemmed from an investigation conducted by the
department's Pension and Welfare Benefits Administration into McMorgan's past
construction lending practices. McMorgan agreed to the settlement after
voluntary mediation of the department's claims that the company had imprudently
underwritten a series of construction loans in the mid- to late- 1980s. As part
of the settlement, the parties agreed to new underwriting guidelines, which
McMorgan will follow in future construction loan financing involving employee
benefit plans governed by the Employee Retirement Income Security Act. McMorgan
tendered the full settlement amount for allocation to the affected pension
plans. |
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McMorgan served as the investment manager and had authority to
execute investments with regard to some or all of the assets of the affected
plans. These plans covered 123,000 participants in California and Nevada and
had cumulative assets totaling $4.9 billion as of Dec. 31, 1996. |
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The settlement resulted from an investigation conducted by the San
Francisco Regional Office of the department’s PWBA into alleged violations
of ERISA. |
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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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