Labor Department Sues Trustees of Fairfax, Virginia 401(k) Plan Over Delinquent Employee Contributions and Loan Repayments

Archived News Release — Caution: Information may be out of date.

Philadelphia, Pennsylvania - The U.S. Department of Labor has filed a lawsuit in federal district court in Alexandria, Virginia, against the trustees of Columbia Services Groups Inc. for failure to remit employee contributions and loan repayments to the company’s 401(k) plan. Columbia was a government contractor that provided information technology assistance to the federal government.

The suit alleges that trustees Emmet Anderson and Michelle Marks violated the Employee Retirement Income Security Act (ERISA) by failing to remit employee withholdings and loan repayments to an employee pension benefit plan during the period May 2004 through June 2005. Anderson is the company’s president and Marks is executive vice president of human resources.

“Trustees of a 401(k) plan have a responsibility to ensure that the assets of the plan are used solely to benefit participants,” said Mabel Capolongo, regional director of the department’s Philadelphia office of the Employee Benefits Security Administration (EBSA). “One of the most important responsibilities is putting money from workers’ wages into their 401(k) accounts on time.”

The lawsuit asks that the trustees restore any losses owed to the plan, be removed as fiduciaries, replaced by an independent fiduciary to manage plan assets, and permanently barred from fiduciary service to any other plan in the future. In a separate adversary legal action against Anderson, who filed personal bankruptcy, the department is seeking to have his debt to the plan deemed non-dischargeable.

The suit resulted from an investigation conducted by EBSA’s Washington District office. Employers and workers needing help with problems related to private-sector retirement and health plans can reach the Washington District office at 301.713.2000 or call EBSA’s toll-free number 1.866.444.EBSA (3272).

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.

(Chao v. Columbia Services Groups, Inc.)
Civil Action No. 1:06-CV-433

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Archived News Release — Caution: Information may be out of date.

Contact Name: Kate Dugan
Phone Number: 215.861.5101