Compliance July 29, 2005

Trustee Gets 57-Month Jail Term for Savings Plan Embezzlement

July 29, 2005 (PLANSPONSOR.com) - A federal judge has jailed and fined the former chief financial officer of a White Plains, New York-based marketing firm on charges he embezzled more than $1.3 million from the firm's retirement plan for which he served as trustee.
Reported by

A news release from David Kelley, US Attorney for the Southern District of New York, said US District Judge Colleen Mcmahon sentenced defendant Phillip Yuk Fun Liu to 57 months in jail and ordered him to reimburse more than 40 participants in the Guild Concepts Ltd. Employee Savings Plan. Kelley put the amount embezzled at approximately $1.34 million

According to Kelley, Liu was the Guild Concepts’ official responsible for sending participant contributions to the savings plan. Kelley said Liu admitted that between January 1, 1998 through on or about December 31, 2003, Liu didn’t send $351,040 in participant contributions to the plan.

Also, from February 27, 2003 through on or about December 2, 2003, Liu pulled out of the plan approximately $996,207. According to the charges, none of those redemptions was either authorized by plan participants or withdrawn for their benefit.

Finally, Liu also admitted that in or about January 2004, he issued fraudulent quarterly participant statements, for the quarter ending December 31, 2003, that failed to disclose that the plan was underfunded because of Liu’s actions.

«