EBSA moves to rescue ‘orphan’ retirement benefits
The U.S. Department of Labor’s Employee Benefits Security Administration (EBSA) has sued Parkland Hotel Investors—once one of the Twin Cities’ biggest commercial financiers—in an attempt to distribute the company’s 401(k) assets to 96 former employees who participated in its retirement plan.
Parkland closed its doors in July 2009, leaving an estimated $1.35 million in 401(k) plan assets. Since then, participants have not received statements or been able to collect benefits from the plan.
Plans where neither the employer nor the plan fiduciary is servicing the plan are considered “orphan” plans. Part of EBSA’s function is to take over orphan plans to ensure plan assets are properly managed, and plan participants receive benefits they are due. Filing a lawsuit is the first step in that process.
If EBSA assumes control, plan participants will be able to roll their accounts over into IRAs or collect benefits.
