Employees of Emergi-Lite Co., Westbrook, Conn., received restitution for the $2 million in assets embezzled from their 401(k) plan by Gary Moore, the outside investment manager, record keeper and trustee.
The money came from a combination of various insurance policies the company had, according to Francis Creighton, aide to Rep. Sam Gejdenson, D-Conn. Mr. Gejdenson introduced legislation earlier this year requiring small retirement plans to use banks or other qualified financial institutions to hold their assets, and to give participants full disclosure on how their pension assets are invested.
Mr. Gejdenson will renew his efforts for legislation next year, but is open to modifying it to address the concerns of both pension administrators and pension rights groups, Mr. Creighton said. One of the concerns pension administrators had raised was how often they would need to provide investment information to participants, he said.
Mr. Moore, meanwhile, was sentenced Oct. 9 to 51 months in prison.
Employees also are suing the company for more than $1 million in investment earnings they had to forgo this year, according to Mr. Creighton. The Labor Department, which investigated the matter, is expected to issue regulations based on Mr. Gejdenson's legislation, Mr. Creighton said.
