One Trustee is Delinquent in Contributions / Possible Bankruptcy

[Guest calcu]

One Trustee's company of a Taft-Hartley Plan is delinquent to the fund to the tune of millions. This has been going on for several years and was just brought to the attention of the other trustees. The company may now be going bankrupt. The trustee is the sole owner. May we go after the trustee personally under the theory that he breached his fiduciary duty to the fund by not disclosing the delinquency? even if the company files bankruptcy? Any other ideas will be greatly appreciated!!

Thanks!

[david rigby]

Ouch! Get thee to competent ERISA attorney. Quickly.

Make sure attorney has experience with Taft-Hartley plans and bankruptcy.

[GBurns]

Make sure the lawyer checks the D&O or Fiduciary Liability coverage of all the Trustees and the E&O etc of the Auditors and accountants etc.

A number of years and they are just finding out? What happened to the Plan auditors and accountants etc? Didn't the Plan have to file Form 5500 and do tax returns, it should have showed up?

[Effen]

I agree with both PAX & GBurns. I find this very hard to believe. Usually they Union stops sending men if an ER is more than a month or two behind. What do they expect to tell the men who worked for this guy when they ask for their pension benefits? I find it hard to believe that the Union let this get so far out of hand, without some sort of collusion between the other Trustees or the Plan Administrator.

If what you say is true, they most likely have BIG problems.

[Bill Ecklund]

The standards for deliquency collections is set forth in PTE 76-1. It would appear that the trustees have engaged in a prohibited transaction, which may make them personally liable for the delinquencies. If the pension plan is a db plan, then the law requires that they accrue benefits even though contributions have not been made.