Halliburton Resolves Pension Violations

November 11, 2005 (PLANSPONSOR.com) - Halliburton Co. has revealed that is has resolved three cases involving mishandling of employee pension plans.

In the first case, a retirement income plan from Halliburton’s former Dresser division had been overfunded by 5.5%, reports the Houston Chronicle. The plan required the company to disburse the extra money to plan beneficiaries, but it didn’t. Halliburton also failed to sell or distribute 88,451 shares of Prudential Insurance to the plan beneficiaries that were in an escrow account, according to the Chronicle. In May 2003 the company began paying nearly $2 million related to the overfunded plan. It also distributed the shares in April 2004.

The second case involved an employee fund that pays expenses for legal, actuarial and other services for an executive bonus program and others. The payments should have been made by Halliburton as regular business expenses. The Chronicle reports that Halliburton reimbursed the fund $2.6 million in August 2004.

The third case resulted from the company accidentally deleting a deduction made to pay for loans when it changed payroll plans in 1999. Employee loans defaulted and an IRS-approved solution caused some employees with loans to incur a 10% early withdrawal tax penalty. The mistake was discovered in 2003 and the company reimbursed those employees more than $191,000 for the tax penalty payments in 2004.

Halliburton said it cooperated with the government to identify and voluntarily solve the problems.