Madison Wis. Corporate Trustee Ordered To Restore More Than $50,000 To Plan For Federal Pension Law Violations

Archived News Release — Caution: Information may be out of date.

The corporate trustee of a 401(k) and profit sharing plan in Madison, Wis., was ordered to restore more than $50,000 to the plan for making imprudent investments on participants’ behalf and for authorizing the plan to engage in conflict-of-interest transactions in violation of the federal pension law.

In a consent order and judgment obtained by the Labor Department, DEC International Inc., was ordered to restore $58,877 to its 401(k) and profit sharing plan. The corporation also serves as the plan sponsor and administrator. A complaint filed by the department on Dec. 23 alleged that DEC used plan assets to purchase individual whole life insurance policies, but failed to independently investiMadison Wis. Corporate Trustee Ordered To Restore More Than $50,000 To Plan For Federal Pension Law Violations gate its merits. In addition, the corporation, acting in the capacity of the plan’s sponsor, authorized a real estate sale transaction between itself and the plan for property located on 4602 Helgesen Drive in Madison.

Both actions violated the Employee Retirement Income Security Act (ERISA). DEC failed to act prudently and in the interest of the plan’s participants by purchasing the whole life insurance and engaged in transactions prohibited between related parties with the real estate sale.

DEC is a privately-held corporation that operates within the food and dairy industries.

DEC manufactures equipment and other products for farms and food plants. As of Dec. 31, 1994, its 401(k) and profit sharing plan had a total of 289 participants and assets totaling $21,264,939.

The consent order and judgment resulted from an investigation by the Chicago Regional Office of the Pension and Welfare Benefits Administration into violations of ERISA. The consent order and judgment were entered on Dec. 29, in the federal district court in Western District in Madison.

Herman v. DEC International, Inc.
Civil Action No.98 C 0868C

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Archived News Release — Caution: Information may be out of date.

Contact Name: RITA FORD
Phone Number:202.219.8921