Silicon Valley Workers Regain Control of Abandoned Profit Sharing Fund Labor Department Judgment Replaces Absent 401(k) Plan Administrator

Archived News Release — Caution: Information may be out of date.

San Francisco, California - The U.S. District Court in San Jose has replaced the manager of a South Bay company’s 401(k) profit sharing plan, giving former workers access to their pension plan which was abandoned three years ago.

Some 33 former employees of Management Resource Associates, LLC, a Silicon Valley firm which leased employees to the semi-conductor industry, will be able to access funds in the Management Resource Associates 401(k) Profit Sharing Plan. The judgment will allow plan participants to roll their funds over into a new plan or to make other distributions for the first time since the company closed in September 1998. The plan was established in July of 1997. As of June, 2000, there were 33 participants with vested benefits of approximately $111,000 in assets.

Management Resource Associates was the administrator of the MRA 401(k) plan when it’s general manager, Gary Farhner, relocated from the South Bay to Crescent City in September 1998, abandoning both the company and its employee pension plan.

The judgment removes MRA as plan administrator. The court will appoint an independent administrator to disburse the assets of the plan, considered orphaned by MRA in September of 1998.

Plans become orphan plans when they are abandoned by all plan fiduciaries designated to manage them and their assets, preventing participants and beneficiaries from receiving pension distributions and making inquiries about their benefits.

“MRA employees who had put money into the plan for nearly two years weren’t even able to get statements on the plan’s performance,” said Bette Briggs, regional director for the Labor Department’s Pension and Welfare Benefits Administration in San Francisco. “This company simply walked away from its responsibilities to employees and to their pension plan.”

Briggs said PWBA aggressively enforces laws which prevent this kind of abuse, and protect the hard-earned pension benefits promised by employers. Briggs credits employees of the leasing firm for contacting her office in San Francisco, “These employees took action to protect money they knew was theirs. As a result, they will once again be able to manage their retirement funds, and to include this money in their retirement planning.”

Briggs encourages anyone with questions about their private employer sponsored pension plans to pay attention to the statements they receive from the plan administrators, and to call if they have questions or concerns. Employees may contact the San Francisco office of the Pension and Welfare Benefits Administration at 415.975.4600 during regular business hours. Additional information is available from the Labor Department’s Web site. Copies of PWBA publications can also be requested from the agency’s toll free publications hotline at 1.800.998.7542.

U.S. Department of Labor news releases are accessible on the Internet. The information in this news release will be made available in alternate format upon request (large print, Braille, audio tape or disc) from the Central Office for Assistive Services and Technology. Please specify which news release when placing your request. Call 202.693.7773 or TTY 202.693.7775.

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