A participant in a 401(k) plan run by USI Insurance Services Inc., Valhalla, N.Y., sued the company and fiduciaries alleging ERISA violations in plan management ranging from charging "unreasonable and excessive fees" to using a subsidiary as the plan's record keeper.
"Instead of leveraging the plan's substantial bargaining power to benefit plan participants and beneficiaries, defendants caused the plan to imprudently pay unreasonable and excessive fees" for record keeping services, said the complaint filed March 2 in a U.S. District Court in White Plains, N.Y.
"Defendants placed their interests ahead of the interests of plaintiff and other plan participants and beneficiaries by using a subsidiary of USI" as a record keeper, said the complaint in the case of Cunningham vs. USI Insurance Services LLC et al. "The decision to use USI's in-house consulting group cannot be justified in light of the excessive and unreasonable amount" of fees paid.
The complaint, which seeks class-action status, alleges that the ERISA violations began in March 2015 and still continue.
The USI 401(k) Plan had assets of $848 million as of Dec. 31, 2019, according to the complaint.
"While we cannot comment on the pending litigation, USI has engaged independent consultants over the years to review the plan's fees and expenses on a regular basis to help ensure that the fees are reasonable and competitive with those charged by other plan administrators," spokesman Timothy Denton said in an email.