Two recent settlements make what should be an obvious point: You can’t misappropriate employees’ retirement money and expect to get away with it. Cases in West Chester and Bethlehem show that the feds will come looking for you, and make you pay it back.
The now-defunct Compass Capital Partners of West Chester and its owner must repay $661,206 in funds illegally diverted from employees’ retirement accounts. The U.S. Department of Labor sued owner Harris DeWese, alleging he took the money from the company’s retirement program and deposited it in his own personal accounts.Security Administration (EBSA) investigators also traced some of the diverted money to Florida-based Hillsboro Printing, a company in which DeWese is a shareholder.
Both DeWese and Compass Capital are barred from ever having fiduciary responsibilities under a retirement plan covered by the Employee Retirement Income Security Act.
Monocacyfabs Inc. of Bethlehem has agreed to return $34,310 to the company’s 401(k) retirement savings plan following an EBSA investigation of the company.
The investigation revealed that company owners Michael Poole and Jean Shipley failed to remit employee contributions to the fund and made late contributions to the fund without paying interest. The investigation covered account activity between June 2007 and June 2010.
Note: Employers that treat retirement contributions as some sort of miscellaneous source of revenue are headed for big trouble.