U.S. Labor Department obtains default judgment against defunct Arlington, Virginia, company to protect workers’ 401(k) plan

Arlington, Virginia – The U.S. District Court for the Eastern District of Virginia has issued a default judgment removing Global System Enterprises Inc., formerly of Arlington, as fiduciary of its 401(k) plan.

The judgment resolves a lawsuit filed by the U.S. Department of Labor in December 2009 alleging that the company abandoned its plan without distributing the assets when it ceased operations in 2005. Under the judgment, G Trust Financial Partners of Topeka, Kan., is authorized to terminate the plan and distribute plan assets to participants and beneficiaries.

“Our legal action was taken to protect the interests of the plan’s participants who have a right to gain access to their retirement savings,” said Mabel Capolongo, director of the department’s Employee Benefits Security Administration in Philadelphia, Pennsylvania. “Employers cannot abandon 401(k) plans when a company goes out of business.”

According to the latest data available, the plan had eight participants and approximately $60,257 in assets as of September 4, 2009.

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. Employers and workers can reach EBSA’s Washington District Office at 202.693.8700 or toll-free at 866.444.3272 for help with problems relating to private sector retirement and health plans. For more information, visit www.dol.gov/ebsa.

Solis v. Global System Enterprises, Inc
Civil Action Number: 1:09-CV-1351 (LMB/IDD)

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