U.S. Department of Labor obtains consent order for restoration of more than $26,000 to 401(k) plan of defunct East Bay company

Archived News Release — Caution: Information may be out of date.

San Francisco - Three former officers of a Livermore, California-based telecommunications and networking company have agreed to restore $26,451 to the 401(k) plan of the now-defunct business under a consent order obtained by the U.S. Department of Labor.

Robert Chipley, Curtis Chipley and Wilbert Kang agreed to restore to the Prime Service Group 401(k) plan all unpaid contributions. The Chipleys and Kang also waived any benefits owed to them from the plan and called for assets to be distributed to some 95 plan participants by August 6.

This legal action resolves the Labor Department’s lawsuit against the company and its former officers. The suit, filed in U.S District Court in San Francisco during August 2006, alleged that the Chipleys and Kang failed to forward employee contributions between February 2001 and August 2003. The department alleged their action violated the Employee Retirement Income Security Act. The company filed for bankruptcy protection in March 2005.

“We are very pleased to successfully restore the full amount due the former employees of Prime Services Group,” said Francis C. Clisham, director of the department’s Employee Benefits Security Administration (EBSA) regional office in San Francisco, which investigated the case. “This action demonstrates the department’s commitment to protect the retirement benefits of America’s workers.”

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.

Employers with similar problems who are not yet subject of investigations by EBSA may be eligible to participate in the department’s Voluntary Fiduciary Correction Program (VFCP). Participation in the VFCP requires employers to make workers whole but allows them to avoid EBSA enforcement actions and civil penalties as well as any applicable excise taxes. For more information about the VFCP or other agency programs, see www.dol.gov/ebsa.

Employers and workers with questions or concerns regarding their private sector pension and health plans can contact EBSA’s San Francisco Regional Office at 415.625.2481 or toll-free at 1.866.444.EBSA (3272).

Chao v. Chipley
Civil Action Number C06-4888 EMC

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Archived News Release — Caution: Information may be out of date.