DOL successfully concludes multi-million-dollar benefits scam case after 18 years
The case concluded with total distributions of $68 million to more than 200 employee benefit plans harmed by John Koresko and associates.
The Department of Labor has concluded a longstanding case against a disbarred attorney and former benefits plan fiduciary who gained personally by diverting millions from employee benefit plans.
The department’s Employee Benefits Security Administration Philadelphia Regional Office began an investigation of John J. Koresko, of Bridgeport, the Regional Employers Assurance Leagues Voluntary Employees’ Beneficiary Association Trust and other affiliated companies in 2003. 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. Koresko and associates pocketed the money and used it to purchase personal property on the Caribbean island of Nevis and in South Carolina, boat rentals and other improper personal uses.
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The U.S. District Court for the Eastern District of Pennsylvania in mid-August 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 him 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.
“The plans’ participants suffered much harm due to the defendants’ action,” said Michael Schloss, the EBSA Philadelphia regional director. “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.”
Attorneys with the Labor Department and EBSA investigators worked with the court, the independent fiduciary and the forensic accountant to marshal and distribute plan assets to their rightful owners.
“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,” said Oscar Hampton III, the agency’s Philadelphia regional solicitor.
Employers and workers can reach EBSA toll-free at (866) 444-3272 for help with problems related to private sector retirement and health plans.