U.S. Labor Department Sues Officers of Chicago Business to Restore Delinquent Contributions to Company’s Retirement Savings Plan

Archived News Release — Caution: Information may be out of date.

Chicago – The U.S. Department of Labor has sued two fiduciaries of Miicro Inc., Chicago, for failing to forward employee contributions to the company’s pension plan and to segregate plan contributions from the general operating assets of the company.

“The department will act when plan fiduciaries fail to carry out their duty to protect the assets held on behalf of a retirement plan’s participants,” said Steve Haugen, director of the department’s regional office in Chicago of the Employee Benefits Security Administration (EBSA).

The lawsuit alleges that fiduciaries Dawn Matthews, president of Miicro, and Terry Brown, vice-president, failed to remit contributions deducted from workers’ paychecks from February through August of 2004, to the retirement plan accounts as required by the Employee Retirement Income Security Act (ERISA). Those funds were commingled with Miicro corporate accounts.

The suit seeks to require that the two make good any losses to the plan resulting from their fiduciary breaches, permanently enjoin Matthews and Brown from serving as fiduciaries on ERISA covered plans, and to correct any prohibited transactions. The suit also asks that the court appoint an independent fiduciary to terminate the plan and distribute its assets to the participants and beneficiaries, if necessary, and require that Matthews and Brown obtain a fidelity bond adequate to meet the requirements of ERISA.

Employers with similar problems, who are not yet the subject of an investigation 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, see www.dol.gov/ebsa.

The suit, filed in federal district court in Chicago, resulted from an investigation conducted by the regional office in Chicago of EBSA. Employers and workers can reach EBSA’s office in Chicago at 312.353.6976 or through EBSA’s toll-free number, 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. Miicro)
Civil Action No. 07-C-5420

U.S. Department of Labor news releases are accessible on the Department's Newsroom page. The information in this news release will be made available in alternate format upon request (large print, Braille, audio tape or disc) from the COAST office. Please specify which news release when placing your request at 202.693.7828 or TTY 202.693.7755. The U.S. Department of Labor is committed to providing America's employers and employees with easy access to understandable information on how to comply with its laws and regulations. For more information, please visit the Department's Compliance Assistance page.

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