US Labor Department seeks to recover $263,951 for N.C. Caro M.D., S.C. Defined Benefit Plan in Chicago after owner alleged to have mishandled funds

Date of Action:  Sept. 30, 2011

Type of Action:  Complaint

Name(s) of Defendant: Nicholas C. Caro, individually and as a fiduciary to the N.C. Caro M.D., S.C. Defined Benefit Plan; and, Nicholas C. Caro’s medical practice, N.C. Caro M.D., S.C., as administrator of and fiduciary to the plan.

Allegations: Caro, in his capacity as a fiduciary to the plan, liquidated $263,951 from the plan’s investment accounts and transferred the funds to accounts held in his own name, accounts held in the name of a former medical practice, accounts held in his wife’s company’s name, and other accounts as yet unidentified.  The transferred funds were used to pay for, among other things, the medical practice’s operating expenses, and were not used to provide benefits to the plan’s participants or beneficiaries. 

The Secretary alleges that defendants Caro and the medical practice failed to discharge their duties with respect to the plan solely in the interest of its participants and beneficiaries and failed to ensure that plan assets were held in trust.  The defendants also caused the plan to engage in transactions that they knew or should have known constituted a transfer to, or use by or for the benefit of, a party in interest.  The defendants dealt with assets of the plan in their own interest, and acted on behalf of a party whose interests are adverse to the interests of the plan, its participants, and beneficiaries.

The Department of Labor seeks the repayment of all plan losses, including lost interest, caused by the fiduciary breaches committed and also seeks to remove both defendants from their positions as fiduciaries to the plan, and enjoin Caro from serving as a fiduciary to any ERISA plan in the future.  The lawsuit also seeks the appointment of an independent fiduciary to distribute assets and terminate the plan, and an order that the defendants pay all fees and expenses incurred by the independent fiduciary.

Court: Northern District of Illinois, Eastern Division, Chicago

Solis v. Nicholas C. Caro, N.C. Caro M.D., S.C. Defined Benefit Plan in Chicago
Civil Action Number 1:11-cv-06884

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U.S. Department of Labor materials are accessible at www.dol.gov.  The information above is available in large print, Braille, audio tape or disc from the COAST office upon request by calling 202-693-7828 or TTY 202-693-7755.