U.S. Department of Labor obtains settlement with defunct Rougemont, North Carolina, clinical research company to restore funds to SIMPLE IRA plan

Archived News Release — Caution: Information may be out of date.

Atlanta – The U.S. Department of Labor has obtained a settlement agreement requiring defunct BDH Clinical Research Services Inc., Rougemont, North Carolina, and its former president to restore $22,921 to the retirement accounts of four former employees.

“These employees counted on this money to pay their future retirement benefits,” said Rebecca Marshall, director of the Atlanta Regional Office of the department’s Employee Benefits Security Administration (EBSA). “The defendants in this case violated their fiduciary duty of trust by diverting the money for other uses.”

Under the terms of the agreement, Basil Halliday and BDH Clinical Research Services Inc. will restore to the BDH Clinical Research Services Inc. SIMPLE IRA plan the contributions owed to four participants that was diverted from their retirement accounts for the benefit of the corporation. Halliday and BDH Clinical Research Services also agreed not to serve as fiduciaries in the future to any plan governed by the Employee Retirement Income Security Act.

A Savings Incentive Match Plan for Employees (SIMPLE) is an individual retirement arrangement (IRA) that allows employers and employees to make contributions to a traditional IRA. The arrangement is suited for small employers who do not currently sponsor a retirement plan. BDH Clinical Research Services, located near Durham, North Carolina, was a research consulting firm until it ceased operations.

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

Employers and workers can reach EBSA’s Atlanta Regional Office at 404.302.3900 or toll-free at 866.444.3272 for help with problems relating to private sector retirement and health plans. In fiscal year 2007, EBSA achieved monetary results of $1.5 billion related to pension, 401(k), health and other benefits for millions of American workers and their families.

Chao v. BDH Clinical Research Services
Civil Action Number 1:07-cv-00420

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Archived News Release — Caution: Information may be out of date.