Former employees of Molina Healthcare Inc. sued NFP Retirement Inc., in its role as an investment adviser to a Molina 401(k) plan, alleging ERISA violations.
"As a plan fiduciary, NFP was obligated to act for the exclusive benefit of plan participants and beneficiaries and to ensure that plan expenses are reasonable and plan investments are prudent," said the May 16 complaint filed in a U.S. District Court in Los Angeles.
"Instead of acting in the exclusive best interest of participants, NFP caused the plan to invest in flexPATH's untested target date funds, which replaced established and well-performing target date funds used by participants to meet their retirement needs," the complaint said. "NFP also caused the plan to pay unreasonable investment management fees."
The flexPATH index target-date funds are collective investment trusts maintained by Wilmington Trust, a bank that serves as the trustee for the funds, said the complaint in Mills et al. vs. NFP Retirement Inc. (NFP Retirement does business as 401k Advisors Inc.)