LAKELAND, Fla. – The U.S. Department of Labor has sued defunct GBK & Associates Inc. and its owners, Deborah Burgess-Wyngate and George Kamanis, to restore losses suffered by the company’s 401(k) plan participants and beneficiaries. The lawsuit followed an investigation by the department’s Employee Benefits Security Administration into alleged violations of the Employee Retirement Income Security Act.
The lawsuit alleges that the defendants withheld $23,537.53 in contributions from employees’ wages in 2006 and 2007 but failed to forward those funds to the 401(k) plan. Instead, the funds were co-mingled with the general assets of the company, and the defendants failed to restore to the plan the full amount of the un-remitted contributions plus the lost interest that would have been accrued if the funds had been properly deposited into the plan.
“The Labor Department will not tolerate owners of this company misusing employee retirement contributions for corporate purposes rather than to provide retirement benefits to the plan’s participants,” said R.C. Marshall, EBSA’s regional director in Atlanta, Ga.
The suit, filed in the U.S. District Court for the Middle District of Florida-Tampa Division, asks the court to order the defendants to restore all losses suffered by the plan, including lost interest and lost opportunity costs, and to offset the individual plan accounts of the defendants to repay any plan losses. The suit also seeks to permanently bar the defendants from serving in a fiduciary capacity to any employee benefit plan subject to ERISA and to appoint an independent fiduciary to oversee the plan at the defendants’ expense.
GBK & Associates Inc. was an automotive equipment and tools sales company in Lakeland.
This case is part of EBSA’s employee contribution project to safeguard workers’ contributions to 401(k) and health benefit plans and was investigated by the agency’s Atlanta Regional Office. Employers and workers can reach that office at 404-302-3900 or contact EBSA toll-free at 866-444-3272 for help with problems relating to private sector retirement and health plans. For more information, visit http://www.dol.gov/ebsa.
Solis v. GBK & Associates Inc.
Civil Action File Number 10-cv-02611
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