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DOL recovers 401(k) funds for St. Paul company employees

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in Compensation and Benefits,Human Resources

According to the U.S. Department of Labor’s Employee Benefit Security Administration, Weinhagen Tire employees’ retirement contributions took an illegal detour into the St. Paul company’s operating accounts.

EBSA alleges that from February 2010 to May 2015 the tire retailer withheld $35,363.86 in employee retirement contributions. Somehow $29,058 of those contributions found their way into the company’s corporate bank account. The action violates ERISA—the Employee Retirement Income Security Act.

As a result of EBSA’s investigation, the tire company’s owner has paid the plan $41,754, a sum that represents the missing funds plus lost opportunity costs. EBSA investigators appointed an independent fiduciary to administer the plan moving forward. Weinhagen is barred from administering any ERISA plan.

Note: Retirement plans are not piggy banks for employers to tap on rainy days.

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