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News Release
Labor Department Recovers $3.6 Million From Bennett Funding Group
Archived News Release — Caution: Information may be out of date.
New York, New York - The U.S. Department of Labor obtained a judgment requiring the Bennett Funding Group, Inc. to restore $3.6 million including interest to the company’s pension and profit sharing plans.
In a March 4 judgment entered in the federal district court in Syracuse the Bennett Funding Group (BFG) of Syracuse, New York, and its subsidiary, the Bennett Management & Development Corp. (BMDC) are required to disgorge $2.4 million received from unlawful transfers plus approximately $1.2 million in lost opportunity costs. The department’s judgment against the corporate defendants was negotiated with Richard C. Breeden, the Chapter 11 trustee appointed by the U.S. Bankruptcy Court for the Northern District of New York. Any distribution of this restitution to participants will be subject to final proceedings of the bankruptcy court.
Litigation is ongoing against Edmund Bennett and his son Patrick, company officers and the plans’ trustees. The department is asking that they be held liable with BFG and BMDC for full restitution.
Bennett Funding Group, a member of a group of over 150 companies, is primarily engaged in the leasing of office equipment. The company sponsored the pension and profit sharing plans for as many as 232 participants. Collectively, the plans had approximately $3.6 million in assets at the end of 1995.
On February 4, 1997, the department sued the Bennetts for diverting plan money to the Bennett Funding Group and two other companies in which Patrick Bennett had ownership interests. The trustees also allegedly made unsecured loans totaling $250,000 to Hemlock Associates, a firm unrelated to them. The firm and the trustees were charged with failing to collect the money owed to the plans.
“This action reaffirms our commitment to protect the hard-earned benefits promised by employers,” said James Benages, director of the department’s Boston Regional Office of the Pension and Welfare Benefits Administration, which investigated the case into alleged violations of the Employee Retirement Income Security Act (ERISA).
Employers and workers can call the Toll-Free Employee & Employer Hotline at 1.866.275.7922 for help with any problems relating to private-sector pension and health plans.
(Chao v. Bennett Funding Group
Civil Action No. 97-CV-0148 (NAM))
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Archived News Release — Caution: Information may be out of date.