What to do with the money?

[Guest A_Dude]

We recieved a check for the proceeds of a lawsuit for a mutual fund plans was invested in. Some of the plans have terminated and the companies went out of business before we received these procedes. What do we do with it? Also, do we need to track down plans who also are due a portion of the proceeds for the lawsuit that have since left us. We also have cases were the company still exists, but the plan no longer exists. I wish this never happened!

Can we just escheat the money to the state?

[david rigby]

Who is "we"?

[Guest A_Dude]

Does it matter?

[chc93]

We had this happen to a company (bankruptcy) and plan that terminated a couple of years before these checks were received. We referred the DOL Field Assistance Bulletin 2006-1 to the bankruptcy attorney. While the FAB addressed demutualization proceeds, the thought process seemed appropriate. The DOL basically says to use prudence, weighing the cost and ultimate benefit. If allowed by the plan and it is determined that allocations to participants are not "cost-effective", the amount may be used for other plan purposes, such as fees. The DOL also goes on to say that it might be appropriate to not accept the settlement distribution. Apparently, these kinds of settlements/proceeds can be returned to the issuing party. In our case, the bankruptcy attorney sent the checks back, and I never heard about it since.

[Guest A_Dude]

chc93 Thank you. Reading the FAB 2006-01 guidance was really helpful. I think we can finally resolve this issue, and get it over with