The Labor Department sued two defunct companies based in Maryland, alleging both breached their fiduciary duties under ERISA in operating their retirement plans.
In two separate complaints, both filed Jan. 8 in the U.S. District Court in Baltimore, the department alleged that iProcess Online and Jones Dykstra and Associates withheld employee contributions from employee paychecks in their 401(k) plan and 401(k) profit-sharing plan, respectively, with the promise of remitting the money to employee accounts.
However, both defendants "did not remit all employee contributions to the plan, instead allowing the money to remain unsegregated in the company's general operating account," according to the the complaints, Julie A. Su vs. iProcess Online Inc. et al. and Julie A. Su vs. Jones Dykstra and Associates Inc. et al.
Jones Dykstra and Associates failed to remit $43,894.76 in participant and employer contributions from January 2016 through 2021, while iProcess failed to remit $192,511 in contributions from January 2014 through August 2023, according to separate DOL news releases.
The defendants also did not ensure that all employer matching contributions were made, nor that all requests for participant distributions were processed, according to the complaints.
"Defendants breached their duties of exclusive purpose, prudence, and loyalty, caused the plan(s) to enter into non-exempt prohibited transactions, and engaged in self-dealing," the complaints said.
Both complaints seek to restore all plan losses and lost opportunity earnings. They also seek "removal and a fiduciary bar, appointment of an independent fiduciary paid for by the fiduciary defendants and preservation of all books and records relating to finances and administration of the company and plan," the news releases said.
Neither iProcess Online nor Jones Dykstra and Associates could not be reached for comment, as the defunct companies do not operate working websites.