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Administration October 3, 2006
DoL Obtains Settlement Agreements for Pension Plans
October 3, 2006 (PLANSPONSOR.com) - The Department
of Labor (DoL) has obtained settlement agreements from Circle
Trust Company (CTC) of Darien, Connecticut, and other
corporate and individual defendants, which were accused of
engaging in imprudent and risky investments.
Reported by Rebecca Moore
According to a DoL press release, CTC, Trust Advisors LLC, and certain corporations and individuals have agreed to restore more than $8.8 million to 1,500 pension plans nationwide. The settlements relate to pension plan investments in Trust Advisors Stable Value Plus Fund (SVF), a collective trust administered by CTC. Circle Trust also agreed to allow a $10 million priority proof of claim in its receivership proceedings, the DoL announcement said.
According to the DoL suit against CTC filed in November 2005, from July 1999 until the present, the company violated ERISA by, among other things, causing SVF to invest in a number of speculative and imprudent investments recommended by Trust Advisors, which resulted in millions of dollars in losses to the trust fund (See DoL Sues CT Investment Firm ).
On September 30, an independent fiduciary appointed on behalf of SVF filed a petition seeking bankruptcy protection for the SVF, and the Connecticut Banking Commissioner was appointed as the receiver of CTC.
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