Labor Department To Recoup 401(K) Plan Losses From Former Louis Allis Company President

Archived News Release — Caution: Information may be out of date.

The U.S. Department of Labor has settled its civil lawsuit in Milwaukee with the former president of the bankrupt Louis Allis Co., Daniel E. Stetler, III., recouping $70,867.43 for participants of the company-sponsored non-union 401(k) plan. Stetler had, in January 1999, filed his own petition for personal bankruptcy.

The department’s complaint against the company plans and Stetler of Greendale, Wis., a 41% owner of the common stock of Louis Allis Co. and a member of its board of directors, requested relief under the Employee Retirement Income Security Act.

In the settlement, Stetler, barred permanently from holding a fiduciary position with any employee benefit plan covered by the Employee Retirement Income Security Act, agreed to restore the salary deferrals to the non-union plan by a transfer of money from his own 401(k) account in the non-union plan.

The Louis Allis Co. established its union and non-union employee 401(k) plans in 1994, and for approximately a two-month period in 1998, the company allegedly failed to remit voluntary employee contributions withheld through salary deferral to the plans’ investment accounts.

On Dec. 21, 1999, M. Larry Lefoldt of Ridgeland, Miss., was named as the independent fiduciary to the plans. He is arranging for the orderly distribution of plan assets to participants, and the total liquidation and termination of the plans. Lefoldt has ascertained that the combined assets of the plans as of Dec. 31, 1999, total approximately $9.7 million.

The legal actions pertaining to the company’s pension plans resulted from an investigation conducted by the Chicago Regional Office of the department’s Pension and Welfare Benefits Administration into alleged violations of the federal pension law. The settlement was entered in the federal district court in Milwaukee on Feb. 28.

(Herman v. Daniel E. Stetler III, )
Civil Action No. 99-C-502

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Archived News Release — Caution: Information may be out of date.