Help! Fortune 500 firm stalling distribution to designated beneficiary

[Guest AnnaS.]

Here's my story. Can anyone tell me what to do now? I can't afford to hire a lawyer, and I need the distribution soon. I would be forever grateful--I am at my wits end!

My mom died in October of 1999. I have been trying to get a distribution on her account since November of 1999. In November of 1999, I wrote to an HR person in the Fortune 500 company she worked for. I informed him of my mom's death and enclosed a certified copy of my mom's death certificate. He responded with a letter advising me that I am the beneficiary of my mom's account, and enclosing a distribution election form. He also advised that I get tax advice before distribution. I did that in January 2000.

My financial advisor began calling both this HR person and another in that company, trying to get distribution information. They were unable to provide plan guidelines, and unable to answer my financial advisor's questions regarding distribution. My financial advisor called and left numerous messages from February through the middle to latter part of the year. At that point we decided to just leave the money in the account, since I didn't really need it, and I had other financial matters to handle at the time.

In January of this year, I decided that I would buy a house by summertime, and would use the money for a down payment. My financial advisor called the HR department once again. We knew that the company had gone through a merger last year, so he just kept trying, and leaving messages, etc. The correspondence that had been sent to my mom indicated that the retirement accounts would be accessible once the conversion was complete in early January. Finally, he called and spoke to the head of HR.

The head of HR was both courteous and helpful, and said the matter would be resolved. We sent him a letter with a certified copy of my mom's death certificate, on January 21st, requesting a full distribution, as per his phone discussion with my financial advisor. At that point, the date of distribution was the end of February. No check arrived. No letter confirming distribution by a certain date, arrived either. So we called again. Again, another answer saying it's coming, it should be there by the end of the week. (That would make it March 9th) It's been almost 6 weeks since we sent the distribution request. Thusfar, the head of HR keeps extending the date the check should arrive, citing computer problems associated with the merger. We've left messages with him again.

The head of HR finally called me back. He was unable to tell me whether or not the computer problem was resolved, and if my distribution check was coming. He believed that the employees’ “blackout period” was over. I asked if I could get verification in writing as to when that money is coming for mortgage purposes. He said he didn't think that he could do that. He also said that he wasn't sure if my paperwork was in order, or, if the beneficiary forms were complete. I told him that was news to me, since we had sent him a letter in January requesting distribution, because that was what he told my financial advisor. He said he would check into things and call me back (i.e. Tuesday, the 13th).

Today, I heard that yes, the beneficiary form is on file, my paperwork is in order, the blackout period is indeed over for the computer systems, so I should be getting my money. However, he's unable to tell me when exactly that will be, because that's dependent on the bank. He's checking with his supervisor if he can send me a letter confirming that, I am the beneficiary, and that I will receive this money, for my mortgage application.

What should I do? I can't believe this guy anymore, and something seems fishy here. Again, I can't afford an attorney! And I need the distribution soon or I can't close on my house! Any advice would be wonderful. Thanks so much to anyone willing to help me out.

[RCK]

I can offer you two things:

1. Perspective. I'm a benefit manager for a Fortune 500 company, and have been known to disappoint participants and beneficiaries. That usually happens when the plan of an acquired company is really messed up and it has taken us a long time to get it sorted out. And those things always take longer than expected. That does not explain the severity of your situation. As an aside, we will not deal with financial advisors without a release from the participant. And if I have a stack of calls to return, advisors/agents/brokers are not at the top of the list.

2. Advice: As a beneficiary of a former participant in the plan, you are now a participant, and have the rights of a participant. You want to submit a formal (return receipt requested) request to the administrator for a Summary Plan Description (SPD). When you get that, it will include information on how to file a formal claim for benefits. You should file a claim for benefits, following the rules in the SPD, making it clear that it is a claim for benefits, and should submit that (also return receipt requested). This will almost certainly get the plan administrator moving.

[KIP KRAUS]

I agree with everything RCK has mentioned. In addition, when you submit your request for the SPD you may want to request the appropriate distribution paperwork and complete it again. I wouldn’t trust that your original paperwork is still in their hands. If you don’t get satisfaction after going through this process you may want to consider contacting the local Department Of Labor and see what they may offer in the way of assistance. In fact, you may want to contact them immediately.

[Guest Benefits Maven]

Another thought. I found it interesting that the "head of HR" for a Fortune 500 has to "check with his supervisor" to see if he can send a letter! Its not exactly an unsual request in the circumstances. As a Benefits Manager, I would certainly have that authority. I would work my way up the ladder and quickly - find the REAL head of HR and do it yourself - we HR people talk to plan participants and beneficiaries, we rarely have time to deal with financial advisors.