U.S. Labor Department Obtains Settlement Restoring Funds to Virginia Company’s 401(k) Plan

Archived News Release — Caution: Information may be out of date.

Alexandria, Virginia - The U.S. Department of Labor has obtained a consent judgment requiring Therapy Management Services Inc. of Alexandria, Virginia, and its president, Brenda Hunt, to restore $32,899 to the company’s 401(k) plan.

The judgment follows a Labor Department investigation that found the defendants violated the Employee Retirement Income Security Act (ERISA) by failing to forward employee contributions to the pension plan or remit them in a timely fashion. Hunt, while serving as fiduciary, failed to ensure that the plan contributions were segregated from the company’s general operating fund and deposited in the plan.

“Plan fiduciaries have a duty to act responsibly with the funds entrusted to them,” says Mabel Capolongo, director of the department’s Philadelphia regional office of the Employee Benefits Security Administration (EBSA). “This legal action demonstrates the department’s commitment to protect the hardworking men and women who entrust their retirement funds to a company plan.”

The judgment resolves a lawsuit filed by the Labor Department in December 2005.

The judgment removes Hunt and the company from their positions with the plan and appoints Jackie Carmichael as an independent fiduciary with authority to administer, manage and dispose of plan assets, including final disbursements to participants. In addition, Hunt and Therapy Management are permanently enjoined from serving as trustees, fiduciaries, advisors or administrators of any ERISA-covered plan.

The judgment, entered in federal district court in Virginia, resulted from an investigation conducted by EBSA’s Philadelphia regional office. In fiscal year 2005, EBSA achieved monetary results of $1.7 billion related to pension, 401(k), health and other benefits for millions of American workers and their families. Employers and workers can reach the Washington district office at 301.713.2000 or through EBSA’s toll-free number, 1.866.444.EBSA (3272), for help with problems relating to private-sector retirement and health plans.

(Chao v. Therapy Management Services, Inc., and Brenda M. Hunt)
Civil Action No. 1:05-CV-1366

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Archived News Release — Caution: Information may be out of date.

Contact Name: Kate Dugan
Phone Number: 215.861.5101