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Release Date: 10/16/2001
Release
Number: 01-362
Contact Name: Gloria Della
Phone Number: 202.219.8921 |
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Washington, DC - On October 16, 2001, the U.S.
Department of Labor obtained a consent order requiring the trustees of the
National Electrical Benefit Fund in Rockville, Maryland, to pay $4.95 million to the
fund as restitution for making an imprudent loan of pension assets and an
imprudent purchase of shares in a limited partnership in 1992 and 1993.
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This restitution will resolve the
department’s lawsuit and will return money to pay promised retirement
benefits. |
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On May 5, 1999, the department sued the trustees
for imprudently loaning plan assets to Columbia Land and Development
Corporation to acquire and develop land in Orlando, Florida, known as Country Run.
The department alleged that the trustees should have known that the loan could
not be repaid in full with interest. |
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“This aggressive settlement is part of our
commitment to crack down on pension fund abuses by union and management
officials. We will do everything in our power to protect union members’
pensions from being preyed upon and misspent,” said Labor Secretary Elaine
L. Chao. |
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The fund is a collectively bargained defined
benefit pension plan funded by contributions of participating employers. As of
December 31, 1999, the fund covered over 440,000 union workers with approximately
$9.2 billion in assets. |
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The consent order, entered in federal district
court in Greenbelt, Maryland, resulted from an investigation conducted by the
Washington District Office of the Philadelphia Regional Office of the Pension
and Welfare Benefits Administration into alleged violations of the Employee
Retirement Income Security Act. |
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(Chao v. Moore
Civil Action No. AW-99-1283)
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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. |
