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Release Date: 12/01/2003
Release Number: 03-818-CHI
Contact Name: Sharon Morrissey
Phone Number: 202.693.8664
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Cincinnati, Ohio - The U.S. Department of Labor
obtained a consent judgment and order on November 25, against the
fiduciaries of bankrupt Ohio Industries of Bucyrus, Ohio, ordering
termination of the company’s retirement and health plans as soon as the
fiduciaries repay the plans for losses resulting from their use of the
plan’s assets to fund the company’s general operating expenses. |
“Plan
officials have a duty to manage and protect benefit plans and their assets
so that promised benefits can be provided to employees,” said Joseph
Menez, Regional Director of the Cincinnati regional office in the
department’s Employee Benefits Security Administration (EBSA), which
conducted the investigation. |
Under
the order, John P. Rice, Molly Rice and David Egner, fiduciaries of the
company’s retirement and health plans, waived their rights to their
individual account balances in the retirement savings plan to immediately
repay a portion of the $34,074.09 due to the plan, and agreed to repay the
balance owed to the savings plan by August 26, 2004. Molly Rice agreed to
advise the asset custodian to credit sums to the accounts of non-fiduciary
participants of the savings plan on a pro rata basis and to notify these
same persons. The Rices agreed to repay $8,026.17 due to health plan
participants by August 26, 2004. |
John
Rice was barred permanently from serving in any fiduciary capacity to any
plan governed by the Employee Retirement Income Security Act (ERISA). Once
the savings plan is terminated, Molly Rice will be barred permanently from
serving in any capacity to ERISA-covered plans. |
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The department’s lawsuit, filed January 9, 2003, in
federal district court in Cleveland, alleged that the fiduciaries failed
to remit employee contributions and loan repayments to the savings plan
and failed to remit employee contributions and COBRA payments to the
health plan. They also allegedly failed to secure a fidelity bond for the
savings plan, as required by ERISA. |
Ohio
Industries, the company resulting from the June 30, 1999 merger of the
Ohio Locomotive Crane Co. and Plymouth Industries, is in Chapter 7
bankruptcy. As of March 31, 2001, the Ohio Locomotive Crane Co., Inc.
Savings Investment Plan had $1,964,061 in assets. The savings plan covered
as many as 177 employees. |
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 make workers whole but allows them to avoid EBSA enforcement
actions, civil penalties and applicable excise taxes. For more
information, see www.dol.gov/ebsa. |
Employers
and workers can contact the Cincinnati office at 859.578.4680 or EBSA’s
toll free number at 1.866.444.EBSA (3272) for help with any problems
relating to private-sector retirement and health plans. |
(Chao
v. Rice)
Civil Action No. 1:03CV0066 |
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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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