U.S. Department of Labor obtains court order restoring assets to Birmingham, Alabama automobile parts and services supplier’s 401(k) plan

Archived News Release — Caution: Information may be out of date.

Atlanta – The U.S. Department of Labor has obtained a default judgment in the U.S. District Court for the Northern District of Alabama requiring S&M Holdings Inc. of Birmingham, Alabama, and Robert Sandusky to restore $3,389 to the company’s 401(k) plan. Sandusky served as the plan’s trustee.

“The Labor Department will act to protect employees’ rights when it sees that companies are failing in their fiduciary responsibilities,” said Howard Marsh, director of the Atlanta Regional Office of the department’s Employee Benefits Security Administration (EBSA).

The judgment resolved a lawsuit filed by the department in June alleging that the company withheld employee contributions to the plan in 2004 and failed to segregate employee contributions from company assets in a timely manner in violation of the Employee Retirement Income Security Act (ERISA).

The court removed S&M Holdings Inc. and Robert Sandusky as fiduciaries of the plan and barred them from future service as fiduciaries to any plan covered by ERISA. An independent fiduciary was appointed to oversee the plan’s assets for its 47 participants. S&M Holdings, which ceased operations in January 2005, supplied automobile parts and services.

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 reach EBSA’s Atlanta Regional Office at 404.302.3900 or toll-free at 1.866.444.EBSA (3272) for help with problems relating to private sector retirement and health plans.

Chao v. S&M Holdings Inc.
Civil Action File Number CV-07-J-1084-S

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Archived News Release — Caution: Information may be out of date.