New York Life Insurance Co. reached a $19 million settlement in a lawsuit that alleged self-dealing by plan executives in the management of two of its 401(k) plans.
The lawsuit, filed in 2021 by Stuart Krohnengold, a participant in the New York Life Insurance Co. Employee Progress-Sharing Investment Plan, alleged the company and its 401(k) plan executives violated the Employee Retirement Income Security Act of 1974 by filling the plans with proprietary investment products that provided "windfall profits" to New York Life and its affiliates at the expense of participants.
Krohnengold also sued, as part of a class-action claim, to represent the New York Life Agents Progress-Sharing Investment Plan.
An agreement in principle was filed Jan. 22 in a U.S. District Court in New York by lawyers representing the plaintiff and defendants in Stuart Krohnengold vs. New York Life Insurance Co. et al.
New York Life Insurance Co. Employee Progress-Sharing Investment Plan had $4.1 billion in assets, and New York Life Agents Progress-Sharing Investment Plan had $930 million in assets, both as of Dec. 31, 2022, according to their latest Form 5500 filings.
Plaintiffs requested the District Court in New York give preliminary approval to the settlement in a Feb. 26 filing.
