COLUMBUS, Ohio — A Florida county 457(b) deferred compensation plan sponsor filed a class-action suit against Nationwide Life Insurance Co. and two affiliates, seeking restitution of revenue-sharing payments from mutual funds and other investment advisers.
The suit was filed in U.S. District Court in Columbus on Nov. 15 by Orange County Sheriff Kevin Beary, who oversees the $50 million Sheriff's Office of Orange County Section 457(b) Deferred Compensation Plan.
Nationwide is based in Columbus.
The suit was filed on behalf of all 457(b) plans in the country that have had variable annuity contracts with Nationwide. The other defendants named are Nationwide Financial Services Inc., a subsidiary of the insurer, and Nationwide Retirement Solutions Inc., a unit of Nationwide Financial.
Roger L. Mandel, attorney with Stanley, Mandel & Iola LLP, Dallas, who represents the plaintiff, said in an interview that the court will have to rule on whether the suit can maintain its class-action status.
The suit seeks an accounting of the revenue sharing. It demands Nationwide pay participants all the revenue-sharing payments it received.
"Nationwide is breaching its fiduciary duty to 457 plans by taking kickbacks from mutual funds," Mr. Mandel said. The revenue sharing "was not provided for in the variable annuity contracts, nor was it disclosed by Nationwide."