Date of Action: May 30, 2014
Type of Action: Consent order and judgment
Names of Defendants: Brandy Williams, Wanda Knight, Dmazana Lumukanda, Lakes Area Advertiser Inc. 401(k) Plan and A.D.S. Delivery Service Inc. 401(k) Plan
Allegations: In February 2012, Phoenix Financial Holdings Inc. bought both Lakes Area Advertiser Inc. and A.D.S. Delivery Service Inc. located in Antioch, Ill. Williams, Knight and Lumukanda were the owners of Phoenix Financial Holdings Inc. from February 2012 through October 2012, until the companies ceased operations. Between Feb. 29, 2012, and Aug. 1, 2012, Williams and Knight, both directors in the companies, and named trustees to both Plans, failed to ensure employee contributions and loan repayments were remitted to the A.D.S. Delivery Service Inc. 401(k) Plan. The plan had six participants. Additionally, during the same time period, Williams and Knight failed to ensure employee contributions and loan repayments were remitted to the Lakes Area Advertiser Inc. 401(k) Plan. The plan had 21 participants. Lumukanda, as a named trustee for both Plans, failed to monitor that all plan assets were remitted to the respective plan, and therefore, is also liable, as a co-fiduciary, for the alleged violations.
Resolution: The judgment ordered the defendants to remit $37,463.48 to the Lakes Area Advertisers, Inc. 401(k) Plan, and $12,560.18 to the A.D.S. Delivery Service, Inc. 401(k) Plan. The total payment to both plans was $50,023.66. The judgment removed the defendants from their positions as fiduciaries to both the Lakes Area Advertiser Inc. Plan and the A.D.S. Delivery Service Inc. Plan and enjoined them from serving as fiduciaries or service providers to any employee benefit plan subject to the Employee Retirement Income Security Act for a period of two years. An independent fiduciary has been appointed to terminate the Plans and distribute the assets to qualified participants.
Court: United States District Court for the Northern District of Illinois, Chicago
Docket Number: 1:13-cv-06461
Employers and workers can reach Employee Benefits Security Administration 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.
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