U.S. Labor Department sues president of defunct Lansdale, Pa., company for failing to forward employee contributions to SIMPLE IRA plan

Lansdale, Pennsylvania – The U.S. Department of Labor has sued Michael G. Morgan, president of defunct Brandywine Mortgage Corp., for failure to remit employee contributions to the company's SIMPLE IRA plan in violation of the Employee Retirement Income Security Act.

The lawsuit alleges that Morgan failed to remit employee contributions to the plan, remitted certain employee contributions to the plan late without interest and co-mingled plan assets with the general assets of the company. The alleged violations occurred from September 2003 through December 2006, when the company ceased operations.

"We took this legal action to protect the retirement savings of the employees," said Mabel Capolongo, regional director of the department's Employee Benefits Security Administration in Philadelphia, Pa. "Plan fiduciaries have a legal obligation to protect the interest of the participants they represent and will be held accountable when they fail to meet that obligation."

Filed in the U.S. District Court for the Eastern District of Pennsylvania, the suit seeks to restore to the plan all losses and opportunity costs and to permanently enjoin Morgan from serving directly or indirectly as a fiduciary to any employee benefit plan covered by ERISA.

This legal action resulted from an investigation conducted by EBSA's Philadelphia Regional Office. In fiscal year 2009, the department achieved monetary results of $1.3 billion in pension, 401(k), health and other benefits for millions of American workers and their families.

Employers and workers can contact EBSA's Philadelphia Regional Office at 215.851.5300 or toll-free at 866.444.3272 for help with problems relating to private sector pension and health plans.

Solis v. Morgan
Civil Action Number: 2:10-cv-02409-EL

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