US Department of Labor files lawsuit to appoint an independent fiduciary for Ants Software Inc. abandoned 401(k) Plan in Dunwoody, Georgia

Date of Action: July 2, 2015

Type of Action: Complaint

Name of Defendants: Rik Sanchez, Ants Software Inc., and Ants Software Inc. 401(k) Plan

Allegations: In February 2013, Ants Software Inc. ceased operations. At that time, Rik Sanchez was fiduciary to the Ants Software Inc. 401(k) Plan. Sanchez informed the plan's third party administrator, Aspire Financial Services Inc. that the plan was being terminated and requested that Aspire make account distributions to the plan participants. In May 2013, Sanchez used his plan administrative login information to access each plan participants' profile information and changed each participant's mailing address to be that of Ants and changed the plan's new bank account to be an account controlled by Sanchez. Due to the changes to the plan participants' account information, Aspire refused to proceed with distributing plan assets based on Sanchez's account information changes. Sanchez then requested Aspire to transfer plan management and the assets of the plan to a company named Renowned Holdings Inc., an entity controlled by Sanchez. Aspire again refused to proceed with distributing plan assets based on the requested transfer request instructions from Sanchez. Then, Sanchez stopped administering the plan, leaving plan participants unable to receive information about their plan funds and unable to gain access to their plan benefits. As of August 2013, the plan had approximately 76 participants with assets totaling approximately $1,383,875.53.

Resolution: The department is seeking the defendants be enjoined from engaging in any further violations of Employee Retirement Income Security Act and be permanently enjoined from serving as a fiduciary or employee of any employee benefit plan subject to ERISA. The department also seeks the appointment of an independent fiduciary at the defendants' expense for the purpose of terminating the plan and distributing its assets to plan participants.

Court: U.S. District Court for the Northern District of Georgia, Atlanta Division

Docket Number: 1:15-cv-02388-WSD