The Nashville Tennessean reported thatMastrapasqua Asset Management, a Nashville firm, alleged in its lawsuit filed Thursday that about $796,988 of employee money is missing and that 1Point Solutions had not made investments it had reported to Mastrapasqua employees enrolled in a 401(k) profit-sharing plan.
According to the Mastrapasqua suit, a combination of discoveries made when an employee leaving the firm tried to claim his money last week led the employer to go to court over the matter. Also contributing were a Monday conversation with 1Point CEO Barry Stokes in which he could not explain the missing funds and various media reports, according to the filing.
Also Thursday, Metro Nashville government decided to terminate its nine-month-old contract with 1Point Solutions. Metro schools is expected to follow that lead.
Dorothy Berry, Metro’s human resources director, told the newspaper that no city money is missing, but employees were growing concerned after hearing news reports detailing the lawsuits against 1Point. “We have open enrollment starting in October, and we have employees who were already climbing the walls about this,” Berry said, according to the news report.
Meanwhile, according to the Tennessean, there also were reports of darkened corporate offices, possible layoffs and frozen accounts at the beleaguered benefits manager.
“The companies that have been victimized by 1Point … everybody involved is taking this very seriously, and from what I can tell, they are leaving no stone unturned to try to get to the bottom of it,” said Joseph Woodruff, a Nashville attorney representing Rhode Island-based Reliance Worldwide Corp. and its subsidiary Cash Acme. They are among companies that have filed suit against 1Point, saying that several million dollars in 401(k) and other employee benefit money is missing.
Elsewhere, Knox County Schools in Tennessee and Louisiana state government employees began reporting difficulties using debit cards associated with their 1Point-managed flexible spending accounts. Tommy Teague, CEO of the Louisiana Office of Group Benefits, said workers’ money was safe, though, in a fund that lets employees set aside some pre-tax pay to buy medical supplies and services such as child care.