Fresno Construction Company Ordered to Restore $500,000 to 401K Profit-Sharing Plan

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http://wepartypatriots.com/wp/2012/04/13/fresno-construction-company-ordered-to-restore-500000-to-401k-profit-sharing-plan/

A Fresno-based construction company, Explore General, Inc., and its former President, Jaime M. Gonzalez, have been ordered to restore $519,601 to the company’s 401(k) profit-sharing plan according to the Department of Labor (DOL).

An investigation by the Employee Benefits Security Administration (EBSA) found that the now defunct company’s head was not making the necessary contributions to retirement based on the prevailing wage despite being paid in full by the government. The court battle played out in the U.S. District Court for the Eastern District of California:

Chief Judge Anthony W. Ishii found that the now-defunct construction company was required to pay its workers an hourly prevailing wage rate, including a fringe benefit for each participant in the form of contributions to the retirement plan, when it was contracted to perform work on projects financed by government agencies. The company was paid in full by the agencies for its work, including fringe benefit amounts, and certified that it was sending the fringe benefits to the plan. However, the company failed to remit more than $300,000 to the plan, choosing instead to use the money for general operating expenses. In addition to that amount, the judge’s order requires the company to restore lost earnings to the plan.

“Retirement savings are a vital part of ensuring a steady income after we leave the workforce, which is a key reason that Congress chose to give them special protections,” said Phyllis C. Borzi, assistant secretary of labor for employee benefits security. “Unfortunately, the individuals entrusted with protecting this plan violated those safeguards.”

[DCKit]

1. Another activist judge. When will it end?