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Chicago, Illinois - Lombard, Illinois-based
Employer’s Consortium, Inc. (ECI) and its president, Andrew Cory, must
pay outstanding charges owed to several medical providers and funds owed
to individual retirement accounts of the Employer’s Consortium, Inc.
401(k) Plan, according to a settlement announced today by the U.S.
Department of Labor.
Under the consent judgment and order filed in Federal
District Court in Chicago, Cory and ECI agreed to pay $60,551.33 to four
health and medical service providers to satisfy outstanding claims against
the ECI health plan, and to negotiate settlement of another $264,846.03 in
outstanding claims owed to other health and medical providers as a result
of unpaid claims of participants and beneficiaries in the health plan. In
addition, ECI and Cory have agreed to pay $32,315.37 to the individual
accounts of participants who were in the company’s 401(k) plan from
December 2000 through February 2003. Cory will also be prohibited for five
years from sponsoring, establishing or administering any welfare or
multiple employer welfare arrangements governed by the Employee Retirement
Income Security Act (ERISA) that are funded in whole or part from the
general assets of companies.
“The department will act when plan fiduciaries fail
to carry out their duty to protect the retirement plan assets and health
benefits held or promised on behalf of participants,” said Kenneth Bazar,
director of the department’s Chicago regional office of the Employee
Benefits Security Administration (EBSA).
The settlement resolves a Labor Department lawsuit,
filed simultaneously with the judgment, alleging that Cory failed to hold
plan assets in trust, to act solely in the interest of plan participants
and beneficiaries, and to ensure adequate funding of health and medical
benefit claims.
Employers with similar problems, who are not yet the
subject of an investigation by EBSA, may be eligible to participate in the
department’s Voluntary Fiduciary Correction Program (VFCP).
Participation in the VFCP requires employers to correct violations of the
law but allows them to avoid EBSA enforcement actions and civil penalties
as well as any applicable excise taxes. For more information about the
VFCP, see www.dol.gov/ebsa.
The suit resulted from an investigation conducted by
the Chicago regional office of EBSA. Employers and workers can reach the
Chicago regional office at 312.353.0900 or through EBSA’s toll-free
number, 1.866.444.EBSA (3272), for help with problems relating to
private-sector retirement and health plans. In fiscal year 2004, EBSA
achieved record monetary results of $3.1 billion related to the pension,
401(k), health and other benefits of millions of American workers and
their families.
(Chao v. Employer’s Consortium, Inc.)
Civil Action No. 05 C 3534 |
