DOL Acts to Distribute Terminated Plan Assets

The U.S. District Court for the Middle District of Florida consented to the DOL appointing Jeanne Bryant of Brentwood, Tennessee, as an independent fiduciary for the IAQ Inc. 401(k) Plan. Bryant will carry out the termination of the plan and distribute $155,332.77, its remaining assets and lost earnings, to the plan’s participants. The order also permanently enjoins IAQ Inc. and Gail Garrow, the plan’s former fiduciary, from acting as a fiduciary to any employee benefit plan subject to the Employee Retirement Income Security Act (ERISA).

The DOL lawsuit, Perez v. Garrow (docket number: 2:14-cv-00067-SPC-CM) names Gail Garrow, IAQ Inc., and the IAQ Inc. 401(k) Plan as defendants. The suit alleges that Garrow terminated the plan in April 2009 and asked the plan’s fund custodian, John Hancock, to transfer the plan’s assets totaling approximately $211,334 into an operating account maintained by IAQ.

The assets were placed in the IAQ operating account and commingled with IAQ’s general assets. On or about the date of the transfer there were 45 participants in the plan. The DOL learned that Garrow and IAQ distributed $74,125 of the plan’s assets to only five plan participants. The account balances of the remaining 40 participants were not distributed and remained in the operating account of IAQ.

The full text of the consent judgment and order document can be downloaded here.