Labor Department Settles Lawsuit With Defunct Mid-Continent Holding Company’s Pension Plan Trustee

Archived News Release — Caution: Information may be out of date.

Kansas City, Missouri - The U.S. Department of Labor obtained a consent judgment on April 18 requiring the former 401(k) trustee and corporate officer of three defunct Fenton, Missouri Corporations to repay $27,656.64 to the Mid-Continent Holding Company 401(k) plan.

“The department’s goal is to protect the hard-earned benefits promised to employees,” said Gregory Egan, regional director of the Kansas City office of the Labor Department’s Pension and Welfare Benefits Administration (PWBA), which conducted the investigation. The consent judgment was entered in the federal district court in St. Louis, Missouri.

Besides the restitution, the judgment permanently bars James F. Kistner from serving any employee benefit plan covered by the Employee Retirement Income Security Act (ERISA) and appoints Brooks Hamilton of Brooks Hamilton & Associates Professional Employee Benefit Services of Dallas, Texas as the independent fiduciary to the plan. Hamilton will have authority to terminate the plan and distribute its assets to participants.

The recovery for the plan represents the full amount withheld from the plan participants’ paychecks, but not forwarded to their individual accounts.

Mid-Continent Holding Company was the parent holding company for America’s Home Remodelers (AHR) and A.I. Manufacturing Company, LLC (AI). The deferred compensation plan covered employees of AHR and AI. As of the date the companies were forced into receivership and liquidated, the plan had assets of $524,807 and 208 participants nationwide.

According to the lawsuit filed March 3, 2001, corporate officers and trustees violated ERISA when they failed to transfer to the plan contribution withheld from the paychecks of employees of AHR/AI from May to August 1998. They also allegedly failed to hold the plan’s assets in trust and used plan assets for their benefit and the employer’s.

Employers and workers can contact the Kansas City office at 1.816.426.5131 or 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. Kistner
Civil Action No. 4:01CV 429RWS)

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Archived News Release — Caution: Information may be out of date.