You might think that a Department of Labor lawsuit on behalf of participants in a pension plan would be favorably regarded by plan participants, particularly if it seeks to recover money for those participants.
Not so in the case of the International Association of Machinists, apparently.
In January, DOL filed suit against the International Association of Machinists National Pension Fund and its board of trustees for, according to the DOL, “multiple violations of the Employee Retirement Income Security Act.”
Said violations, the suit said, included breaches of fiduciary duty through selection methods for fund service providers; “lavish” spending; “soliciting and accepting gratuities from plan service providers”; and ignoring provisions of the fund’s governing plan documents.
The IAM National Pension Fund is the fifth largest multiemployer pension plan in the U.S. and has a funded status of 101 percent, according to a “Green Zone” notice it sent to members in April of 2015.
Now the IAM has challenged the DOL’s view of things, calling for withdrawal of the suit “to prevent further harm to the Fund’s reputation,” and claiming that the litigation is over problems that have already been resolved.
The IAM is not a party to the suit, but has waded in nonetheless to defend the IAM National Pension Fund as “among the nation’s most stable and best managed multiemployer plans, and … in full compliance with all DOL rules and regulations.”
The complaint, the union said in its call for the suit’s withdrawal, says nothing about the fund’s stability or its ability to provide its members with a “secure retirement,” and “fails to note that all questionable expenditures were fully reimbursed and new policies put in place to ensure strict compliance with DOL rules.” Instead, it focuses on “issues that have been previously addressed and resolved.”
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