U.S. Department of Labor sues defunct Lewes, Del., company to protect participants of abandoned retirement plan

Lewes, Del. – The U.S. Department of Labor has filed a lawsuit to obtain appointment of an independent fiduciary to oversee the 401(k) plan of Keystone Professional Employers Inc., a defunct company formerly located in Lewes.

"Denying workers access to their retirement savings will not be tolerated by the Labor Department," said Mabel Capolongo, director of the department's Employee Benefits Security Administration (EBSA) in Philadelphia. "Employers cannot abandon 401(k) plans when a company goes out of business."

The plan, created in June 1999, was managed by the company until it ceased operations in 2000. Since that time, the plan has not had a fiduciary responsible for the operation and administration of the plan and its assets. As a result, the plan's participants and beneficiaries have been unable to gain access to or information about their individual balances.

The suit, filed in the U.S. District Court for the District of Delaware, seeks to appoint an independent fiduciary to terminate the plan and distribute plan assets to participants and beneficiaries. It also seeks to direct The Hartford Life Insurance Co., the plan's custodian of assets, to turn the assets of the plan over to the independent fiduciary appointed by the court.

As of May 27, 2009, the plan had nine participants and approximately $14,268.44 in assets, the latest data available.

The suit resulted from an investigation conducted by EBSA's regional office in Philadelphia. Employers and workers can contact that office at 215.861.5300 or toll-free at 866.444.3272 for help with problems relating to private sector pension and health plans. In fiscal year 2009, EBSA achieved monetary results of $1.3 billion related to pension, 401(k), health and other benefits for millions of American workers and their families.

Solis v. Keystone Professional Employers Inc. and the Hartford Life Insurance Co.
Civil Action Number: 1:10-cv-00033-UNA

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