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US Labor Department sues Stevensville, Mich.-based Metal Processors and owner to restore more than $16,000 to company’s 401(k) plan
STEVENSVILLE, Mich. – The U.S. Department of Labor has sued defunct Metal Processors Inc., a die maker in Stevensville, and owner Russel Reschke, to restore $16,200 in employee contributions plus lost interest to the company’s 401(k) plan. The case resulted from an investigation by the department’s Employee Benefits Security Administration into alleged violations of the Employee Retirement Income Security Act.
“Failing to forward voluntary employee salary contributions to employee retirement plans is a violation of trust,” said Paul Baumann, EBSA’s regional director in Cincinnati. “The Labor Department will continue to fight for workers when fiduciaries fail in their responsibilities to properly administer employee benefits.”
The suit, filed in U.S. district court in Grand Rapids, Mich., alleges that the company and Reschke violated ERISA by failing to forward employee contributions to the plan from June 18, 2009, through Sept. 24, 2009. Those funds were retained in Metal Processor’s general account and used to pay the company’s operating expenses. The company filed for bankruptcy Aug. 31, 2010, at which time the plan had 34 participants and $874,191 in assets.
The suit seeks a court order to restore money owed to the plan, including lost opportunity costs, and to appoint an independent fiduciary to terminate the plan and distribute its assets to the participants and beneficiaries. The suit also seeks to prevent the company and Reschke from serving as fiduciaries to any ERISA-covered employee benefit plan in the future.
EBSA protects the security of the retirement, health and other workplace-related benefits of America’s workers, retirees and their families. The agency oversees approximately 708,000 private sector retirement plans, 2.8 million health plans and a similar number of other workplace-related benefit plans that provide benefits to more than 150 million Americans. Collectively, these plans hold more than $6 trillion in assets.
Employers and workers can reach EBSA’s Cincinnati Regional 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 can be found at www.dol.gov/ebsa.
Solis v. Russel Reschke, Metal Processors Inc.
Civil Action Number: 1:11-cv-00380
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