U.S. Department of Labor Gets Court Order Barring Charlotte, North Carolina, Company President from Serving as 401(k) Plan Fiduciary

Archived News Release — Caution: Information may be out of date.

Atlanta, Georgia - The U.S. Department of Labor has obtained a consent judgment permanently barring Brenda Hamrick, controlling shareholder and president of Trawick Artists Management Inc., Charlotte, North Carolina, from serving as a fiduciary of the company’s 401(k) plan.

“The law clearly requires those who administer employee benefit plans to do so in a careful, prudent and honest manner solely for the benefit of participants,” said Howard Marsh, director of the Atlanta regional office of the department’s Employee Benefits Security Administration (EBSA).

The judgment resolves a lawsuit brought by the department that charged Hamrick with violating her fiduciary duties between January 15 and July 31, 2002. As plan trustee, Hamrick allegedly allowed employee contributions to be used for purposes other than providing benefits. The suit also charged that she failed to segregate plan assets from other funds and ensure that the plan received participant contributions.

Under the court order, Trawick is permanently barred from service as a fiduciary to any plan governed by the Employee Retirement Income Security Act.

The 401(k) plan covered two participants and had assets of $19,282 as of August 2005.

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 correct violations of the law 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.

The case resulted from an investigation conducted by EBSA’s Atlanta regional office. Employers and workers can contact the regional office at 404.562.2156 or EBSA’s toll free number, 1.866.444.EBSA (3272), for help with problems relating to private-sector pension and health plans. In fiscal year 2005, EBSA achieved monetary results of $1.7 billion related to the pension, 401(k), health and other benefits for millions of American workers and their families.

(Chao vs. Brenda Hamrick)
Civil Action File Number 3:06CV59-C

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Archived News Release — Caution: Information may be out of date.

Contact Name: Dan Fuqua/Jo Anne Burgoyne
Phone Number: 404.562.2078/404.562.2076