U.S. Labor Department Obtains Court Order to Compel Long Island Attorney to Testify in Federal Investigation

Archived News Release — Caution: Information may be out of date.

New York - The U.S. Department of Labor has obtained a court order requiring the attorney who represents a Long Island profit sharing trust to provide testimony that will aid in an investigation of the trust. The department’s Employee Benefits Security Administration (EBSA) is investigating possible violations of ERISA, the federal Employee Retirement Income Security Act.

The Labor Department petitioned the U.S. District Court for the Eastern District of New York to compel attorney Scott M. Zucker to comply with the department’s administrative subpoena as part of its investigation of the Sol Spitz Co. Inc. Profit Sharing Trust. The company, now inactive, was based in Massapequa Park, New York. As of December 31, 2004, its profit sharing trust had assets of $2,184,872 and 22 participants.

The EBSA is looking into the fact that the trust has paid Scott M. Zucker more than $1 million in legal fees.

“The law requires the assets of plans be used only for the benefit of plan participants and beneficiaries,” said Jonathan Kay, regional director in New York for the EBSA. “Our investigation seeks to determine if there has been a misuse of plan assets in the case of the Sol Spitz Co. Inc. Profit Sharing Trust. Mr. Zucker’s testimony is crucial to our investigation.”

The current court action was filed by the regional office in New York City of the U.S. Labor Department’s Solicitor of Labor.

Kay noted that, in May of this year, Zucker was first subpoenaed to testify in an administrative deposition in this matter. After postponing his testimony several times, Zucker agreed to be deposed on October 12, but failed to appear.

The court has now ordered Zucker to appear to testify at a deposition on December 19, 2006, at the EBSA offices in New York City.

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. Employers and workers can contact the New York regional office at 212.607.8600 or EBSA’s toll free number at 1.866.444.EBSA (3272) for help with problems relating to private-sector retirement and health plans.

(Chao v. Zucker)
Case No. 06-MC-546

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Archived News Release — Caution: Information may be out of date.

Contact Name: John M. Chavez
Phone Number: 617.565.2075