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Press Releases by Date   |   Press Releases by Company Name

View More Press Releases by U.S. Department of Labor [DOL]

Press Release

DOL Obtains Final Order Against John J. Koresko for Involvement in Nationwide Employee Benefit Plan Scheme

Issued by U.S. Department of Labor [DOL]

Sept. 2, 2021

Lengthy investigation, legal pursuit ends as federal court issues final order against a former attorney/fiduciary who diverted millions from more than 200 employee benefits plans

PHILADELPHIA – In an investigative and legal pursuit that spanned more than 18 years, the U.S. Department of Labor has obtained a final order in a Pennsylvania federal court and concluded its long-standing case against a disbarred attorney and former benefits plan fiduciary who gained personally by diverting millions from employee benefit plans.

In 2003, the department’s Employee Benefits Security Administration Philadelphia Regional Office began an investigation of John J. Koresko V, of Bridgeport, the Regional Employers Assurance Leagues Voluntary Employees’ Beneficiary Association Trust and other affiliated companies. The agency found that Koresko and others had diverted tens of millions in plan assets for their personal benefit through a variety of illegal transactions – money that they pocketed and used for purposes such as purchasing personal property on the Caribbean island of Nevis and in South Carolina, boat rentals and other improper personal uses. 

On Aug. 19, the U.S. District Court for the Eastern District of Pennsylvania issued a final order closing the case, and added nearly $4 million to costs previously assessed against Koresko, resulting in a judgment of more than $42 million against Koresko and his companies. The court’s order follows the final distribution in 2021 of $17.7 million to more than 200 employee benefit plans nationwide harmed by Koresko and others – bringing the total distribution to the affected plans to $68 million.

From the start of EBSA’s investigation, Koresko refused to cooperate and the department sought court orders to enforce subpoenas issued by EBSA. The court later found Koresko in contempt. 

In 2015, after the department filed a complaint and pursued litigation against Koresko, the court found the defendants diverted $38.3 million in plan assets and used more than 18 entities and 21 accounts at more than eight banks to mask its scheme. For more than a decade, Koresko used assets from the plans’ trusts for real estate purchases in South Carolina and on Nevis to pay outside counsel, lobbyists, operating expenses of his companies and for personal expenses – all in violation of the Employee Retirement Income Security Act. 

With one exception, the court found the defendants – including Koresko – liable for almost $20 million in restitution for losses and disgorgement of profits. The court also removed and barred the defendants from serving as fiduciaries to any ERISA-covered plan permanently.

In later proceedings, the court imprisoned Koresko for more than two years after finding him in civil contempt for not complying with the order to disgorge his profits back to the plans.

“The plans’ participants suffered much harm due to the defendants’ action. The conclusion of the litigation provides those participants with relief and demonstrates the U.S. Department of Labor’s commitment to ensuring that employers take seriously their responsibility to provide benefits to their employees and their beneficiaries,” said EBSA Philadelphia Regional Director Michael Schloss.

“Attorneys with the U.S. Department of Labor and investigators with the Employee Benefits Security Administration worked tirelessly with the court, the independent fiduciary and the forensic accountant to marshal and distribute plan assets to their rightful owners,” said Philadelphia Regional Solicitor Oscar L. Hampton III. “We held John J. Koresko and his fellow defendants to account for violating the law and upheld the equitable principles of the Employee Retirement Income Security Act.”


View More Press Releases by U.S. Department of Labor [DOL]

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