Judge orders independent fiduciary to terminate employee benefit plan of Clifford Replacement Windows & Siding and distribute assets

Clifford Replacement Windows & Siding and distribute assets

Date of Action: April 9, 2014

Type of Action: Consent Judgment

Names of Defendant: Timothy J. Clifford, Jr., Patrick D. Clifford, Clifford Replacement Windows & Siding, Inc., CRW Inc. 401(k) Plan in Mount Prospect, Ill.

Allegations: Clifford Replacement Windows & Siding Inc. was the Plan Sponsor and Plan Administrator of CRW Inc. 401(k) Plan. Since at least March 31, 2004, through Sept.1, 2006, Timothy J. Clifford was the president and owner of CRW. Since at least March 31, 2004, T. Clifford and Patrick D. Clifford were both named trustees and fiduciaries to the plan. Furthermore, according to the plan’s governing documents, T. Clifford, P. Clifford, and CRW are the only legal persons authorized to direct the disbursement of the plan’s assets.

The department alleges that during sometime in 2006, CRW ceased operations, and was involuntarily dissolved by the Illinois Secretary of State on Sept. 1, 2006. Under the terms of the plan, terminated participants with vested account balances are entitled to receive their benefits upon termination. However, as of July 29, 2013, there were a total of seven participants, one forfeiture account, and a total of $33,033.90 in plan assets. The department alleges that T. Clifford, P. Clifford, and CRW failed to discharge their duties with respect to the plan solely in the interest of the participants and beneficiaries and for the exclusive purpose of providing benefits to participants and their beneficiaries in violation of the Employee Retirement Income Security Act.

Resolution: The judgment permanently enjoining the defendants from serving as fiduciaries or service providers to any ERISA-covered plan and from violating ERISA in the future; appoints an independent fiduciary to distribute the plan’s assets and terminate the plan.

Court: U.S. District Court for the Northern District of Illinois, Eastern Division, Chicago

Docket Number: 1:14-cv-00666

Employers and workers can reach EBSA’s Chicago office at 312-353-0900 or toll-free at 866-444-3272 for help with problems relating to private-sector retirement and health plans. Additional information can be found at www.dol.gov/ebsa.

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.