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Release Date: 03/27/2001
Contact Name:
Gloria Della
Phone Number: 202.219.8921 |
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The U.S. Department of Labor sued the former
401(k) trustee and corporate officers of three Fenton, Missouri corporations for
allegedly failing to timely deposit $32,149.06 of employee contributions into
the Mid-Continent Holding Company 401(k) Plan. |
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Mid-Continent Holding Company is the parent
holding company for America’s Home Remodelers (AHR) and A.I. Manufacturing
Company, LLC (AI). The plan covered employees of AHR and AI. Under the plan,
which is a deferred compensation plan, employees could elect to defer a portion
of their wages as contributions to the plan. As of the date that the
companies were forced into receivership and liquidated, the plan had
assets of $524,807 and 208 participants nationwide. |
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According to the lawsuit, trustee James F. Kistner
and Kevin M. Vaughn violated the Employee Retirement Income Security Act
(ERISA). Kistner and Vaughn were officers of the two corporations whose
employees were covered by the plan. |
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The lawsuit alleges that the defendants failed to
transfer to the plan contributions withheld from the paychecks of employees of
AHR/AI from May to August 1998 and to take action to protect the plan’s
assets from losses. They also allegedly failed to hold the plan's assets in
trust and used plan assets for the benefit of themselves and the
employer. |
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Both Kistner and Vaughn are separately charged
with failure to take action to remedy the fiduciary breaches with the
plan. |
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The lawsuit seeks a court order to appoint an
independent trustee to manage the plan. The department also asks the court to
require that the defendants restore to the plan all losses with interest, undo
any prohibited transactions with the plan, offset their plan benefit accounts
for the amount of losses and to redistribute the offset to the accounts of all
plan participants except the defendants. In addition, the lawsuit asks that the
defendants be permanently barred from serving in a position of trust to any
plan governed by ERISA in the future. |
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“Our goal is to assure that consumers know
that the department is only a phone call away to help protect the benefits
promised by employers," said Gregory Egan, director of the Kansas City Regional
Office of the Labor Department’s Pension and Welfare Benefits
Administration (PWBA). “Employers and workers can reach us at
816.426.5131 for help with any problems relating to private-sector pension and
health plans.” |
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The lawsuit, filed on March 23, 2001 in federal
district court in St. Louis, Missouri, resulted from an investigation conducted by
the St. Louis District Office of PWBA alleging violations of ERISA. |
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(Chao v. Kistner
Civil Action No.
4:01CV429RWS) |
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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. |
