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Release Date: 05/27/2003
Release Number: 246
Contact Name: Sharon Morrissey
Phone Number: 202.693.8664
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South Bend, Indiana - The U.S. Department of
Labor obtained a consent order and judgment on May 20, 2003, in which the
trustees of the pension and welfare plans of Local 1969 of the
International Longshoremen’s Association of Portage, Indiana agreed to
restore $497,225.83 to the plans, resign their positions and be
permanently barred from serving employee benefit plan governed by the
Employee Retirement Income Security Act (ERISA). |
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“These trustees violated one of the most fundamental
rules of ERISA, that assets of employee benefit plans may be used only to
pay benefits and legitimate plan expenses,” said Secretary of Labor
Elaine L. Chao. “This case demonstrates that the department will
aggressively pursue violations of the law to protect the rights of workers
and their families.” |
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The department sued trustees Andre Joseph, Raymond
Sierra, David Lynch, and Edward Rentz in May 2002, for authorizing
multiple payments to the plans’ investment advisors in connection with
investments in two Nevada properties, made payments for legal fees to an
individual who was not licensed to practice law, and made payments for
union and other non-plan expenses. The lawsuit was filed in federal
district court in South Bend, Indiana. |
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An earlier default judgment December 30, 2002 required
the plans’ investment advisor, John Sherwood Dunsmoor, to restore over
$1 million to the plans and permanently barred him from serving any other
benefit plan covered by ERISA. On January 22, 2003, the court, in a
related criminal prosecution, ordered another investment advisor, Michael
A. Daher, to restore over $1.6 million to the plan and permanently barred
him from serving ERISA-covered plans. Daher and Dunsmoor were equal owners
of Qualified Investment Limited (QIL), a Nevada corporation formed in
connection with the plans’ investments in real estate. Both advisors
were indicted and pleaded guilty to various criminal charges with respect
to the plans’ real estate investments. |
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Employers and workers can contact the Chicago Regional
Office at 312.353.0900 or EBSA’s toll free number, 1.866.444.EBSA
(3272), for help with any problems relating to private-sector pension and
health plans. |
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(Chao v. Joseph)
Civil Action No. 3:02CV0380RM |
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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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