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US Labor Department sues Franklin, Ky., trucking company and owner to recover assets for 401(k) retirement plan participants and beneficiaries
FRANKLIN, Ky. – The U.S. Department of Labor is suing Truck It Inc. of Franklin and company owner Steven Ligon to restore employee contributions and lost opportunity costs to participants in the company’s 401(k) retirement plan.
An investigation by the department’s Employee Benefits Security Administration found that the defendants violated the Employee Retirement Income Security Act when they allegedly failed to forward $22,222.61 in employee contributions to the plan in 2008. The lawsuit also alleges that the defendants delayed making $231,838.29 in voluntary employee salary deferral contributions to the plan between 2005 and 2007, resulting in lost opportunity costs. The funds were allegedly diverted into the general assets of the company and used for general operating expenses.
“These defendants engaged in an egregious misuse of money set aside for employees, thereby jeopardizing workers’ ability to receive benefits from the plan,” said Paul Baumann, director of the EBSA Cincinnati Regional Office in Ohio. “The Labor Department will act to protect plan assets and help workers obtain their rightful benefits.”
Filed in U.S. District Court for the Western District of Kentucky by the department’s Office of the Solicitor, the lawsuit asks the court to order that the defendants restore to the plan all losses resulting from their breach of fiduciary duties; undo any prohibited transactions and return to the plan any profits derived from those transactions; set off Steven Ligon’s individual plan account against the amount of the plan’s losses; remove the defendants as fiduciaries; and permanently prohibit the defendants from acting in the future as fiduciaries of any plan subject to ERISA. The department also asks the court to appoint an administrator to take control of the plan, distribute the assets to participants and beneficiaries, and terminate the plan.
This case is part of EBSA’s employee contribution initiative to safeguard workers’ contributions to 401(k) and health benefit plans and was investigated by EBSA’s Cincinnati Regional Office. Employers and workers can contact that office at 859-578-4680 or toll-free at 866-444-3272 for help with problems related to private sector retirement and health plans. Additional information about the agency can be found at http://www.dol.gov/ebsa.
Solis v. Truck It Inc.
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