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$138K debt owed to 401(k) plan by president of defunct West Berlin land improvement company ruled non-dischargeable following consent judgement
Date of Action: Aug. 31, 2016
Type of Action: Consent order and judgment
Name(s) of Defendants: William P. Bowman
Allegations: William Bowman and Associates Inc., a land improvement company based in West Berlin, New Jersey, sponsored the William Bowman Associates Inc. profit sharing 401(k) plan for its employees. William P. Bowman was the president and sole shareholder of the company and the sole trustee of the plan with authority over investment decisions for the plan.
The company filed for bankruptcy in 2007 and ceased operations in 2009. An investigation conducted by the U.S. Department of Labor’s Employee Benefits Security Administration found several violations of the Employee Retirement Income Security Act by Bowman, who used his position to make a series of unsecured loans totaling $188,325.06 to related parties. These loans were never repaid, resulting in losses to the plan and its participants.
On April 23, 2013, based on an earlier complaint filed by the Secretary of Labor involving the plan, Bowman entered into a consent judgment resolving the earlier complaint and was ordered by the court to restore $188,325.06 to the plan through a series of 126 monthly installment payments. Subsequently, Bowman filed for bankruptcy. Restorative payments totaling $49,500 have been made to the plan. There is a remaining debt of $138,825.06 Bowman owes to the plan.
Resolution: The Secretary of Labor entered into a new consent judgment with William Bowman, which resolves all of the allegations in the complaint that was previously filed. Bowman agreed to make restitution to the plan as previously stipulated in the first Consent Judgment.
Court: U.S. Bankruptcy Court for the District of New Jersey
Case Number: 16-01445 (ABA)