|
|
|
|
|
Release Date: 12/14/98
Release Number: USDL:
Chicago V-325
Contact Name: GLORIA DELLA
Phone Number:
202.219.8921 |
|
|
|
Trustees to employee benefit plans of Local 705 of the
International Brotherhood of Teamsters in Chicago have agreed to restore $20
million owed to the local union’s pension plan by an affiliated welfare
plan under a consent order and judgment obtained by the U. S. Department of
Labor. |
|
The restitution returns $16,511,985 to the pension plan which the
trustees improperly transferred to the welfare benefit plan, plus
interest. |
|
Local 705 sponsors the pension and welfare plans for as many as
7,130 participants employed by companies subject to collective bargaining
agreements with the union. As of January 1996, the pension plan had assets of
$779,752,231. |
|
Simultaneous with filing of the judgment, the department sued
trustees of the Local 705 pension and welfare plans. Named as defendants in the
lawsuit are trustees Stephen Bridge, Gerald Zero, Edward Benesch, John
Naughton, John McCormick, Michael Faucher and Otis Cross. |
|
According to the lawsuit, the trustees made 13 separate transfers
of pension plan assets to the welfare plan over the period from 1991 to 1995.
The transfers were made to provide needed financial support to the welfare plan
upon the advice of the plans' attorney and actuary that such transfers were
authorized under ERISA and the Tax Code. The department contended that those
pension plan participants who were not covered by the welfare plan received no
benefit from and were in fact harmed by the transfers. |
|
The complaint and judgment were filed on December 10, 1998 in
federal district court in Chicago, Illinois. The judgment was entered on
December 14, 1998. This case resulted from an investigation conducted by the
Chicago Regional Office of the Labor Department’s Pension and Welfare
Benefits Administration into alleged violations of the Employee Retirement
Income Security Act. |
|
(Herman v. Bridge)
Civil Action No. 98 C 7944 |
|
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. |
|
|
