U.S. Labor Department obtains court order requiring Harris N.A. to pay $274,600 for unpaid health claims

Archived News Release — Caution: Information may be out of date.

Hammond, Indiana – The U.S. Department of Labor has obtained a consent order and judgment in which Harris N.A. agrees to pay $274,600 in unpaid health claims owed to participants of Hammond-based My Smart Benefits Inc. My Smart Benefits was a third-party administrator to dental and vision plans established by participating employers. Mercantile Bank of Indiana, the holder of corporate accounts of My Smart Benefits, has been acquired by Harris.

The Labor Department’s lawsuit alleged that Mercantile violated the Employee Retirement Income Security Act (ERISA) in connection with an account maintained by My Smart Benefits. Mercantile accepted payment from a My Smart Benefits bank account into which the firm had impermissibly transferred the assets of employer plans to pay off a $145,000 corporate loan My Smart Benefits had with Mercantile.

The $274,600 restoration amount includes the money used to pay off the My Smart Benefits corporate loan as well as the money remaining in the My Smart Benefits corporate bank account at Mercantile. In addition, Harris has agreed to pay a civil monetary penalty of $18,161.99 to the Labor Department.

“The actions of these defendants saddled workers with unpaid benefit claims,” said Bradford P. Campbell, acting assistant secretary of the department’s Employee Benefits Security Administration (EBSA). “This judgment returns money to the plan so that benefits promised to workers and their families can be paid.”

The suit resulted from an investigation conducted by EBSA’s Chicago Regional Office. Employers and workers can reach the Chicago office at 312.353.0900 or toll-free at 1.866.444.EBSA (3272) for help with problems relating to private sector retirement and health plans. In fiscal year 2006, EBSA achieved monetary results of $1.4 billion related to pension, 401(k), health and other benefits for millions of American workers and their families.

Chao v. Harris
Civil Action No. 2:07-cv-68

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Archived News Release — Caution: Information may be out of date.