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Release Date: 06/07/2002
Release Number: 237
Contact Name: Sharon Morrissey
Phone Number: 202.693.8664
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Chicago, Illinois - The U.S. Department of Labor has sued the trustee
of the Roselle, Illinois-based Computer America Training Centers, Inc. 401(k)
plan for failing to forward $24,011.69 in employee contributions to the plan. |
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“This action reaffirms our commitment to protect the hard-earned benefits
promised by employers," said Kenneth Bazar, director of the department’s
Chicago regional office of the Pension and Welfare Benefits Administration,
which investigated the case. |
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The department’s complaint, filed May 30 in federal district court in
Chicago, alleged that Christina Nyborg, the company’s president and plan
trustee, failed to forward to the plan contributions withheld from employees’
paychecks and used the money to benefit the company. She also allegedly
failed to secure a proper bond and violated various reporting and disclosure
requirements of the Employee Retirement Income Security Act (ERISA). |
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In its lawsuit, the department is asking that Nyborg be required to repay the
plan the unforwarded paycheck deductions, plus interest, and to waive her
individual account in the plan to be reallocated to all other plan participants
and beneficiaries. The court is also being asked to require Nyborg to
terminate the plan, distribute the assets to participants, file appropriate
termination papers with the Labor Department and the Internal Revenue Service,
and obtain a fidelity bond as required by federal employee benefit law. |
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The company, which ceased operations in November 2001, filed for Chapter 7
bankruptcy protection December 17, 2001 in the U.S. Bankruptcy Court for the
Northern District of Illinois. |
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The plan, adopted in May 2001, had 35 participants and $28,685 in assets,
including the unremitted employee contributions, as of October 31, 2000. |
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The department’s Voluntary Fiduciary Correction Program
(VFCP) allows plans
to correct failures in forwarding contributions withheld from employees’
paychecks and certain other ERISA violations. Eligible applicants who properly
correct transactions under the program will not be subject to enforcement action
or liable for civil penalties. Excise tax liability under section 4975 of
the Internal Revenue Code is also eliminated for certain transactions. |
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Employers and workers may contact the regional office at
312.353.0900 or
PWBA’s Toll-Free Hotline number, 1.866.275.7922 for help with questions about
private-sector pension and health plans. |
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(Chao v. Computer America Training Centers, Inc.
Civil Action No. 02 C 3845) |
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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. |
