Labor Department Sues Owner of Two Colorado Firms to Restore More than $17,000 to Pension Plan Participants

Archived News Release — Caution: Information may be out of date.

Denver, Colorado - The U.S. Department of Labor sued the owner of Colorado-based Auburn Tool and Machine, Inc. and Hammill West, Inc. on March 10 for failure to remit $17,412 in employer and employee contributions to participants’ accounts of the SIMPLE IRA plans sponsored by the two companies.

“This lawsuit is designed to protect the benefits of these companies workers,” said Gregory Egan, director of the Kansas City Regional Office of the Employee Benefits Security Administration (EBSA), which investigated the case.

In the suit, filed in the federal district court in Denver, the department alleges that Sam Wineland, the owner of the companies and fiduciary to both plans, violated the Employee Retirement Income Security Act by failing to remit voluntary contributions withheld from employees’ paychecks. He also failed to collect matching employer contributions at various times from December 1997 through September 2000.

The tool and dye companies sponsored the SIMPLE IRA plans for as many as 15 employees.  The Auburn and Hammill companies, located in Golden and Denver, respectively, established the SIMPLE IRA plans that allowed employees to defer a portion of their wages into individual IRA accounts. The plans also required the employer to make a 3 percent matching contribution.

Egan noted that employers with similar problems, who are not yet the subject of an investigation by EBSA, may be eligible to participate in the department’s Voluntary Fiduciary Correction Program (VFCP). Participation in the VFCP requires employers to make workers whole, but allows them to avoid EBSA enforcement actions and civil penalties, as well as any applicable excise taxes.  For more information about the VFCP, see www.dol.gov/ebsa.
Employers and workers can contact the Kansas City Regional Office at 816.426.5131 or EBSA’s toll free number, 1.866.444.EBSA (3272), for help with problems relating to private-sector pension and health plans.

(Chao v. Wineland
Civil Action No. 03-RB-1413)

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Archived News Release — Caution: Information may be out of date.