U.S. Labor Department obtains independent fiduciary to oversee Texas health benefit plan

DALLAS - The U.S. Department of Labor has obtained a consent order and judgment permanently barring fiduciaries of the Manufacturing and Industrial Workers Union Benefit Fund (MIWU) of Bryan, Texas, from serving in a fiduciary capacity to any employee benefit plan governed by the Employee Retirement Income Security Act (ERISA) and appointing an independent fiduciary to oversee the health fund. The claims involve approximately 2,000 workers and their families in Arizona, Georgia, Illinois, Texas and other states.

The judgment resolves a lawsuit filed by the department alleging that the defendants, five fiduciaries of the affiliated International Union of Public and Industrial Workers (IUPIW) Canadian Benefit Fund, created the MIWU fund solely to dump unpaid health claim liabilities of the IUPIW fund.

Under the judgment, Betty Cordial is appointed to serve as the independent fiduciary of the MIWU fund, with authority to marshal the assets to pay benefits. She can be reached at (602) 240-6821.

In March 2007, through Chao v. IUPIW Fund, the Labor Department obtained a separate consent judgment against the related fund and its fiduciaries that ordered restoration of $562,727 to the IUPIW fund and gave the independent fiduciary appointed in that case control over an additional $762,606 in assets held in the fund's accounts.

This suit alleged that the defendants violated ERISA by transferring participants and their unpaid health claims to the MIWU fund despite knowing that the fund was not financially solvent. The defendants included fiduciaries to both the MIWU and IUPIW funds - William Hope, Gary Couch, Roger "Tim" Gue and Robby Larkin - and Pamela Barlow, secretary-treasurer of the International Union of Petroleum and Industrial Workers.

The judgment was entered in the Atlanta Division of the U.S. District Court, Northern District of Georgia.

The Los Angeles Regional Office of the department's Employee Benefits Security Administration (EBSA) investigated the case. Employers and workers can reach that office at (626) 229-1000 or toll-free at (866)-444-3272 for help with problems relating to private sector retirement and health plans. Copies of the legal documents will be available on EBSA's Web site at www.dol.gov/ebsa. Tips on purchasing health benefits may be found at www.dol.gov/ebsa/newsroom/fshlthinstips.html.

Chao v. Manufacturing and Industrial Workers Union Benefit Fund
Civil Action Number 1:07-CV-0654

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Contact Name: Gloria Della/Rick Manning
Phone Number: 202.693.8664/202.693.4676