Labor Department Obtains Court Order Barring Idaho Company and Executives from Service to Employee Benefit Plans

Archived News Release — Caution: Information may be out of date.

Seattle, Washington - The U.S. Department of Labor obtained a consent order barring the sponsor and service provider of the ePEO Link Inc. Group Accident and Health ERISA Medical Care Plan, and their principals, from serving as fiduciaries or service providers to any employee benefit plan governed by the Employee Retirement Income Security Act (ERISA) in the future. A recent settlement of related actions filed by participating employers will result in payment of approximately $2.37 million towards the ePEO Link plan's unpaid health claims.

The settlement covers ePEO Link Inc., which operated out of Coeur d’Alene, Idaho, and its principals Roger Jeffrey, Jacqueline Holovka, and Frederick Roh, and Integrated Professional Insurance Services Inc. (IPIS) of Bakersfield, California and its former president Lon Olmstead.

“The defendants’ misconduct caused workers and their families to be burdened with millions of dollars in unpaid health claims,” said Secretary of Labor Elaine L. Chao. “I am pleased that the court barred the defendants from ever again being in a position to harm workers by mismanaging employee benefit plans.”

The ePEO Link health plan provided health benefit services as a multiple employer welfare arrangement (MEWA) to approximately 1,500 employees of participating employers in 22 states. The department sued ePEO Link and IPIS in 2005, alleging that the defendants failed to properly evaluate and underwrite benefits, collect sufficient contributions to pay promised benefits, adequately fund the plan and maintain reserves, obtain appropriate reinsurance and maintain plan reports and records required by the plan. Olmstead was separately charged with receiving commissions from the plan's contracts with re-insurers.

The suit, filed in the federal district court in the Northern District of Oklahoma, resulted from an investigation conducted by the San Francisco regional office of the Labor Department’s Employee Benefits Security Administration (EBSA).

Tips on health benefits for small employers may be found on EBSA’s Web site. Employers and workers can reach the San Francisco regional office at 415.975.4600. Help with problems relating to private-sector retirement and health plans can also be obtained by calling EBSA’s toll-free number, 1.866.444.EBSA (3272).

(Chao v. ePEO Link, Inc.)
Civil Action No. 05-CV-676-CVE-PJC

U.S. Department of Labor news releases are accessible on the Department's Newsroom page. The information in this news release will be made available in alternate format upon request (large print, Braille, audio tape or disc) from the COAST office. Please specify which news release when placing your request at 202.693.7765 or TTY 202.693.7755. The U.S. Department of Labor is committed to providing America's employers and employees with easy access to understandable information on how to comply with its laws and regulations. For more information, please visit the Department's Compliance Assistance page.

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

Contact Name: David James/Gloria Della
Phone Number: 202.693.4676/202.693.8664