U.S. Labor Department sues North Carolina company to restore delinquent contributions to SIMPLE IRA plan

Archived News Release — Caution: Information may be out of date.

Atlanta – The U.S. Department of Labor has sued BDH Clinical Research Services and its president, Basil Halliday, to restore $37,031 in delinquent contributions to employees’ individual retirement accounts with the company’s savings incentive match plan (SIMPLE IRA).

“The Labor Department will act when plan fiduciaries fail to carry out their duty to protect the retirement contributions made by covered workers,” said Howard Marsh, director of the Atlanta Regional Office of the department’s Employee Benefits Security Administration (EBSA).

The lawsuit, filed in federal district court in Durham, North Carolina, alleges that the defendants violated the Employee Retirement Income Security Act when they withheld employee contributions to the plan and illegally co-mingled the contributions with the general assets of the company. The defendants also failed to remit matching employer contributions to the plan.

The suit seeks a court order to require that the defendants restore $24,194 in missing employee contributions and $12,837 in delinquent employer matching funds, plus interest. The Labor Department also asks the court to remove Halliday as a fiduciary and appoint a new administrator to oversee the plan.

BDH Clinical Research Services was a clinical research company based in Rougemont, North Carolina.

Employers with similar problems who are not yet the subjects of EBSA investigations may be eligible to participate in the department’s Voluntary Fiduciary Correction Program (VFCP). Participation 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, see www.dol.gov/ebsa.

This case resulted from an investigation conducted by EBSA’s Atlanta Regional Office. 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 and workers can contact the Atlanta office at 404.302.3900 or toll-free at 1.866.444.EBSA (3272) for help with problems relating to private sector pension and health plans.

Chao v. BDH Clinical Research Services Inc.
(Civil Action No. 1:07-cv-00420)

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Archived News Release — Caution: Information may be out of date.