A participant in a 401(k) profit-sharing plan filed a class-action lawsuit against its sponsor alleging violations of the Employee Retirement Income Security Act.
The suit was filed April 17 against BTG International and certain BTG executives by plaintiff Ramon Diaz on behalf of participants in the BTG International Inc. Profit Sharing 401(k) plan. The suit alleges that since Jan. 1, 2012, the defendants have forced the plan "into investments that charged excessive fees" that benefited its record keeper, John Hancock USA.
Sponsors of the 401(k) profit-sharing plan allowed John Hancock "to receive excessive and unreasonable compensation" through direct and indirect fees paid by the plan as well as subadvised accounts both managed and not managed by John Hancock, according to the complaint.
The defendants are being accused of larding the plan "with excessively expensive subadvised accounts — to the exclusion of superior alternatives — which in turn paid John Hancock out of the excessive fees they collected from plan investments."
