Compliance

Sponsor Admits Embezzlement of Plan Dollars

The plan sponsor was criminally prosecuted and pled guilty to embezzlement in June 2016; she was ordered by EBSA to make restitution to restore losses to the plan.

By John Manganaro editors@plansponsor.com | June 21, 2017

The Department of Labor’s Employee Benefits Security Administration (EBSA) has secured a judgement and consent order against Andrea Lynn McCarthy and Lisa Hall, and the Truss Systems LLC Profit Sharing Plan, for violations of the Employee Retirement Income Security Act (ERISA).

By way of background, the U.S. Secretary of Labor last year filed a complaint, based on an EBSA investigation, alleging that McCarthy improperly withdrew $111,624 from the profit sharing plan between January 28 and June 6, 2009. McCarthy was subsequently criminally prosecuted, and pled guilty to embezzlement in June 2016. She was ordered to make restitution to restore losses to the plan.

The formal resolution secured by EBSA orders the defendants to pay, on or before July 21, 2017, $25,253 and pre-judgment interest to reflect the lost earnings and post judgment interest for which McCarthy and Hall are jointly and severally liable. Truss Systems, McCarthy and Hall are also permanently enjoined from acting as a fiduciary, trustee, agent or representative in any capacity to any employee benefit plan as defined by ERISA.

Additionally, the court has appointed an independent fiduciary, AMI Benefit Plan Administrators Inc., to terminate the plan, collect and administer the plan’s assets (including the restitution from the criminal case) and make distributions to the affected participants.

The full consent order is available here

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