Benefits February 13, 2010

Plan Sponsor Sentenced for 401(k) Theft

February 13, 2010 (PLANSPONSOR.com) – A plan sponsor charged with stealing from her company’s 401(k) plan has been sentenced to more than two years in prison.
Reported by

Cynthia Curran, 54, who plead guilty last year to two counts of theft from an employee benefit plan and two counts of making a false statement, must spend 30 months behind bars and pay full restitution for stealing from Barrington Systems’ 401(k) over a nine-year period, U.S. District Judge Phyllis Hamilton said during a hearing this week in Oakland, California.

According to the San Francisco Chronicle, from 1997 to 2006, Curran misappropriated $241,208 in employee contributions and vested employer contributions for her own use while she was vice president of the company and trustee of its 401(k) plan.  The company, which she founded with her husband, developed software for climate-control systems until it went out of business in 2006, according to the report.

Never miss a story — sign up for PLANSPONSOR newsletters to keep up on the latest retirement plan benefits news.

Investigators at the U.S. Department of Labor learned of the crime after employees who were laid off by the company were unable to recover their retirement accounts because their contributions had been stolen.

Curran lied to department investigators about the balance in the 401(k) account to cover up her theft, authorities said, according to the Chronicle.  Curran also suggested that computer hackers may have stolen the money, which Assistant U.S. Attorney Owen Martikan wrote in a sentencing memorandum was “implausible”, according to the report.

Administration February 12, 2010

BT Reaches Plan Funding Pact

February 12, 2010 (PLANSPONSOR.com) - U.K. Telecom giant BT has worked out a plan to plug a record £9 billion pension funding deficit over 17 years, and has gotten the backing of the plan trustees.
Reported by

The shortfall at the 340,000-member plan, the U.K.’s largest pension fund, is the largest among any U.K. private-sector pensions, according to a news report by the Yorkshire Post newspaper.

Rod Kent, chairman of the BT pension trustees, told the Post there has been “exhaustive” efforts over the last 18 months to reach the funding milestone at a time of unprecedented financial turbulence, and that the funding plan “secures significant additional support to the benefit of (plan) members, underpinned by a strong sponsor.”

Never miss a story — sign up for PLANSPONSOR newsletters to keep up on the latest retirement plan benefits news.

BT said an earlier plan was “prudent”, but that the Pensions Regulator had “substantial concerns” over some areas of that agreement, which is still under review by the pensions watchdog. Plan trustees had previously backed the earlier plan to pay £525m a year for three years, which would rise to £583m in the fourth year and grow at a rate of three per cent annually after that.

According to the Post, BT chief executive Ian Livingston sought to assure that improvements to the business are providing enough cash to support the pension plan, while also allowing the group to continue shareholder dividend payouts, to invest in the business, and to reduce debt.

Its pension assets rose by 10% over the past year, to £34 billion, while BT also estimated that a “median estimate” calculation would have put the deficit at closer to £3 billion, the newspaper reported.

«