News Brief

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AARC Environmental Inc. owes missing employee retirement contributions and health plan premiums, let health plan coverage lapse

Date of Action: April 20, 2015

Type of Action: Amended Complaint to permanently enjoin from serving as a fiduciary to any retirement benefit plan subject to the Employee Retirement Security Income Security Act of 1974 and from violating the act.

Name of Defendant: AARC Environmental, Inc., an environmental engineering firm in Houston, Texas, and owner Kishore Chainani

Allegations: AARC Environmental Inc. and owner Kishore Chainani, were sued for missing 401(k) Plan retirement monies in excess of $78,000 and missing health insurance premiums deducted from employees' wages in excess of $40,000 owed to the AARC Environmental Inc. Group Health Plan. The department's lawsuit, alleges that AARC Environmental and Kishore Chainani violated ERISA by failing to forward employee contributions and loan repayments to the company's 401(k) plan and by failing to forward employee and employer premiums to the group health plan, resulting in lapses in health coverage for their employees.

Quote: "AARC Environmental employees placed their trust in their employer to ensure they received promised retirement and health benefits," said Deborah Perry, director of the Dallas Regional Office of the department's Employee Benefits Security Administration, which investigated this case. "He failed them. We hope to remedy that problem by taking every action necessary to restore plan assets that were not properly preserved for the company's workers."

Resolution: The department seeks a court order requiring the restoration of all losses suffered by the 401(k) plan and by the employees participating in the group health plan and barring AARC Environmental, Inc. and Kishore Chainani from serving in any capacity to any other employee benefit plan.

Court: U.S. District Court for the Southern District of Texas

Civil Action Number: 4:14-cv-3688

EBSA News Brief: 
05/19/2015
Contact Name: 

Diana Petterson

Phone Number: 
Contact Name: 

Juan Rodriguez

Phone Number: 
Release Number: 
15-0999-DAL