>According to the US Department of Labor (DoL) news release, executives of TRG Marketing LLC also diverted health plan assets to pay personal expenses and to their family members. The defendants diverted health plan money to pay for European family vacations, personal lines of credit, charitable contributions, brokerage commissions and corporate distributions to themselves and their spouses, according to the federal officials.
>The suit, filed in US District Court in Indianapolis, alleges that William Paul Crouse and Carmelo Zanfei violated ERISA by mixing assets of the health plan with the marketing firm’s money, by failing to charge adequate premiums and by not establishing appropriate underwriting procedures to make sure that enough assets were available to pay benefits
>The TRG plan was a multiple employer welfare arrangement (MEWA) designed to protect participants and their dependents by providing reimbursement for catastrophic health expenses. The plan was funded by premium payments made by employers on behalf of their employees, by employees through payroll deduction, and by individual participants who were not associated with any employers, according to the DoL. When terminated in November 2001, the TRG plan had approximately 11,000 participants nationwide.
>The suit seeks to require Crouse and Zanfei to pay all health claims filed by participants and beneficiaries under the TRG health plan and restore any plan losses with interest, as well as any undue profits they received.