U.S. Labor Department Sues Fiduciary for Abandoning Denver-Based Company’s 401(k) Plan

Archived News Release — Caution: Information may be out of date.

Denver, Colorado - The U.S. Department of Labor has sued the fiduciary of the Denver-based AMS Industries Inc. 401(k) plan for abandoning the plan and failing to distribute the assets to plan participants.

The suit, filed in federal district court in Denver March 21, alleges that AMS owner Joseph Weinraub abandoned the plan and failed to ensure that more than $206,000 in plan assets were distributed to 26 plan participants, in violation of the Employee Retirement Income Security Act (ERISA).

“The department acts quickly to help workers get their benefits when plan assets are either misused or the plans are abandoned,” said Steve Eischen, regional director of the Employee Benefits Security Administration’s (EBSA) Kansas City office, which investigated the case.

Plans become orphan plans when they are abandoned by all fiduciaries designated to manage and operate them and their assets. As a result of the abandonment, participants and beneficiaries are unable to communicate with the plan fiduciary or obtain distributions from their accounts.

The suit seeks to remove Weinraub as the plan’s named trustee, appoint an independent fiduciary to distribute the plan assets and permanently bar Weinraub from serving as a fiduciary to any plan governed by ERISA.

AMS Industries provided commercial janitorial services in the Denver area. The department understands that AMS ceased operations in late 2003 and Weinraub filed Chapter 7 bankruptcy.

Employers and workers can reach EBSA’s Kansas City regional office at 816.426.5131 or through EBSA’s toll-free number, 1.866.444.EBSA (3272), for help with problems relating to private-sector retirement and health plans. 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.

AMS Industries, Inc. 401(k) Plan
U.S. District Court Case # 06-CV-005000 MSK

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Archived News Release — Caution: Information may be out of date.

Contact Name: Rich Kulczewski
Phone Number: 303.844.1302