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US Department of Labor sues former CEO of Charlotte, NC, Web development company to restore more than $100,000 to 401(k) plan
CHARLOTTE, N.C. – The U.S. Department of Labor is suing Garrison Enterprises’ former chief executive officer and chairman of the board, Cameron Garrison, to restore $103,481.37 to the Web development company’s 401(k) pension plan. The lawsuit follows an investigation by the department’s Employee Benefits Security Administration that found employees’ contributions to the 401(k) plan had been commingled with the general assets of the company, a violation of the Employee Retirement Income Security Act.
Filed in the U.S. District Court for the Western District of North Carolina, Charlotte Division, the suit alleges that employee contributions withheld between Feb. 21, 2007, and April 30, 2009, were never forwarded to the plan. The contributions were used for company purposes and obligations rather than for the exclusive benefit of the plan and its participants.
“Employees contribute to their retirement plans with the expectation that the funds will be there when needed,” said Isabel Colon, director of EBSA’s regional office in Atlanta. “The Labor Department will not tolerate the diversion of these funds for other uses.”
The department is asking the court to order Garrison to restore all losses, including interest or lost opportunity costs, to the plan, and that his individual plan account be set off against the amount of losses to all participants. The department also is asking that Garrison be permanently barred from serving as fiduciary, administrator, officer, trustee, custodian, agent, employee or representative of any employee benefit plan subject to ERISA. Finally, the department asks that a successor fiduciary be appointed to oversee the plan’s assets.
As of Dec. 31, 2009, the plan had approximately 33 participants and assets totaling $101,687, the latest data available.
Garrison Enterprises specializes in the development of Web-based solutions for government and is headquartered in Charlotte.
This case was investigated by EBSA’s Atlanta Regional Office. It is being litigated by the Labor Department’s Regional Office of the Solicitor in Atlanta. Employers and workers can contact EBSA’s Atlanta office at 404-302-3900 or toll-free at 866-444-3272 for help with problems relating to private sector retirement and health plans. For more information, visit www.dol.gov/ebsa.
Solis v. Cameron Garrison
Civil Action File Number 3:11-cv-00664
U.S. Department of Labor news materials are accessible at www.dol.gov. The information above is available in large print, Braille, audio tape or disc from the COAST office upon request by calling 202-693-7828 or TTY 202-693-7755.