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Administration September 12, 2003
DoL Sues Ill. Exec Over Plan Debts
December 9, 2003 (PLANSPONSOR.com) - The US
Department of Labor (DoL) has filed a lawsuit against the
executive of Omni Circuits, Inc., in Glenview, Ill., to block
any potential efforts to skip out on repaying debts to the
company's welfare plans through his personal
bankruptcy.
Reported by Fred Schneyer
The suit filed in US Bankruptcy Court in Chicago alleges that James Schwarz violated ERISA by not remitting $23,996 in premiums and payments, contributed by employees between December 1, 2001 and February 21, 2002, to insurers and using the money to pay corporate operating expenses. Schwarz was president and chief executive officer of the family-owned company
The plans provided health, dental and supplemental life insurance benefits to 70 employees of the company. Omni Circuits, which was the plans’ administrator, ceased operations in February 2002.
In a related action, the department filed a civil lawsuit against Schwarz and his daughter, Corinne Moderhock, over the delinquent premium and payments of employees. The suit seeks to require that the defendants restore all losses plus interest to the plan and be permanently barred from serving as a fiduciary to any ERISA-covered plan.