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News Release
Independent Fiduciary Appointed to Abandoned 401(K) Plan Of Defunct New York City Publishing Company
Archived News Release — Caution: Information may be out of date.
New York, New York - The U.S. Department of Labor obtained a judgment on January 31, 2003, appointing the Benefits Advantage, Inc. as the independent fiduciary of The Publications Company 401(k) plan in New York City and giving the firm authority to distribute 401(k) assets to plan participants. The plan was abandoned by plan officials, leaving participants without access to or information about their plan accounts.
“Our goal is to protect the hard-earned benefits promised by employers," said Francis Clisham, director of the New York Regional Office of the Labor Department’s Employee Benefits Security Administration (EBSA).
Plans become "orphan plans" when they are abandoned by all plan fiduciaries designated to manage and operate the plans and their assets. Without a plan fiduciary, participants and beneficiaries are unable to receive pension distributions or to make inquiries about their benefits.
The company ceased operations in 1999. The 401(k) plan covered seven participants and has approximately $100,000 in assets held in trust by the Lincoln National Life Insurance Company, which is named to obtain relief for the plan.
The suit alleges that the whereabouts of Simon Cowen, the plan’s sole trustee, are unknown. It is believed he relocated to England, but he has not responded to communications from the Labor Department or a plan participant. Successor plan officials were not appointed to operate the plan.
The Labor Department’s suit alleges that violations of the Employee Retirement Income Security Act (ERISA) occurred when the now-defunct company failed to appoint a successor trustee to administer and terminate the plan.
The suit, filed on October 4, 2002, in U.S. District Court for the Southern District New York in New York City, resulted from an investigation conducted by EBSA’s New York Regional Office into alleged violations of ERISA. Employers and workers can contact the regional office at 212.337.2462 or EBSA’s toll free number, 1.866.444-EBSA (3272), for help with any problems relating to private-sector pension and health plans.
(Chao v. The Publications Company 401(k) Plan)
Civil Action No. 02 CV 7937
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Archived News Release — Caution: Information may be out of date.