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Release Date: July 26, 2007
Release Number: 07-1136-NEW/BOS 2007-199
Contact Name: John M. Chavez
Phone Number: 617.565.2075
New York – The U.S. Department of Labor has
obtained a federal court order appointing an independent fiduciary to
manage the abandoned 401(k) plan of Hagedorn Actuarial Services Inc.,
Mineola, New York.
The Labor Department filed suit last October alleging
that a successor fiduciary was not appointed after plan trustee William
Lambiase pleaded guilty to embezzlement of $16,000 in plan assets in
August 2005. Since that time, the plan’s participants and
beneficiaries have been unable to gain access to or obtain information
about their individual account balances.
Plans become “orphan plans” when they are
abandoned by all fiduciaries designated to manage and operate them. As
of August 2006, the plan had approximately $48,446 in assets being held
by custodian American Funds Group.
“The department took legal action to ensure that
the participants receive their promised benefits,” said Jonathan Kay,
director of the New York Regional Office of the department’s Employee
Benefits Security Administration (EBSA), which investigated the case.
The court order, issued by the U.S. District Court
for the Eastern District of New York, appoints Herbert A. Whitehouse as
the independent fiduciary of the plan. Whitehouse will administer the
plan; distribute the assets to participants, beneficiaries and any plan
creditors; and terminate the plan.
In fiscal year 2006, EBSA achieved record monetary
results of $1.4 billion related to the pension, 401(k), health and other
benefits for millions of American workers and their families. Employers
and workers can contact EBSA’s New York Regional Office at
212.607.8600 or EBSA’s toll-free number at 1.866.444.EBSA (3272) for
help with problems relating to private sector retirement and health
plans.
Chao v. Hagedorn Actuarial Services, Inc. 401(k)
Profit Sharing Plan
Civil Action Number: 2:06-CV-05733-LDW-ARL
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