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Compliance June 18, 2020
Guilty Plea Secured in $15M Retirement Plan Embezzlement Scheme
A Texas couple has admitted to submitting more than 90 unauthorized distribution requests from some 20 retirement plans between 2014 and 2017.
Reported by John Manganaro
A Red Oak, Texas, couple has pleaded guilty to charges related to their roles in a $15 million retirement plan embezzlement scheme.
According to U.S. Attorney for the Northern District of Texas Erin Nealy Cox, Vantage Benefits Administrators co-owner Wendy Richie pleaded guilty Tuesday to two counts of theft from an employee benefit plan and one count of aggravated identity theft. Her husband, Vantage co-owner Jeffrey Richie, pleaded guilty to two counts of aiding and abetting theft from an employee benefit plan. Their company served as the third party administrator for dozens of pension and retirement funds.
The plea comes nearly two years after a federal grand jury indicted the couple on various charges of theft from an employee benefit plan and aggravated identity theft.
According to plea papers, Ms. Richie admitted to using fund beneficiaries’ personal information to submit $15.2 million in fraudulent distribution requests to Matrix Trust, the funds’ custodian. Instead of depositing the money into beneficiaries’ accounts, however, she transferred it into Vantage’s operating account, then into personal bank accounts.
The U.S. Attorney’s office says that even after a Vantage employee confronted Mr. Richie about Ms. Richie’s conduct, Ms. Richie continued to embezzle money from the funds. At least $6.2 million of the $15.2 million Ms. Richie embezzled was taken with Mr. Richie’s knowledge, he admitted. In total, the pair admitted to submitting more than 90 unauthorized distribution requests from 13 pension plans and seven defined contribution (DC) retirement plans from 2014 and 2017.
“This couple took advantage of innocent people who were working hard and saving for their future,” Cox said in October 2018 when the couple was charged. “We cannot permit such brazen financial misconduct to go unchecked.”
Ms. Richie now faces up to 12 years in federal prison, while Mr. Richie faces up to 10 years. They may be required to pay restitution as well as a $500,000 fine.