U.S. Department of Labor sues to distribute 401(k) assets to workers of bankrupt Iowa business

Archived News Release — Caution: Information may be out of date.

Des Moines, Iowa – The U.S. Department of Labor has sued the fiduciary to the 401(k) plan of Urbandale, Iowa-based Scangraphics Inc. for abandoning the plan and failing to distribute approximately $220,000 in assets to 11 plan participants.

“The Labor Department is committed to protecting the hard-earned benefits of workers when their plans are abandoned,” said Bradford P. Campbell, assistant secretary of the department’s Employee Benefits Security Administration (EBSA).

The suit alleges that James Achey violated the Employee Retirement Income Security Act (ERISA) when he abandoned the plan and failed to ensure that its assets were distributed to eligible plan participants. As a result of the abandonment, participants were unable to obtain distributions from their accounts. The suit seeks to remove Achey as the plan’s named trustee, appoint an independent fiduciary to distribute the plan assets, and permanently bar Achey from serving as a fiduciary to any plan governed by ERISA.

Scangraphics Inc. was a commercial printing company. The department believes that the company ceased operations in September 2006 and Achey, the owner of the company, filed for Chapter 7 bankruptcy.

The suit, filed in federal district court in Des Moines, resulted from an investigation conducted by EBSA’s regional office in Kansas City, Missouri. Employers and workers can reach the regional office at 816.285.1800 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. Achey
Civil Action Number 4:07-cv-00430

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Archived News Release — Caution: Information may be out of date.