According to the 7/02/10 of Pensions & Investments, the Department of Labor filed a lawsuit against Explore General Inc. alleging that Explore failed to put more than $70,000 of employee contributions in the company's 401(k) plan. Furthermore, the lawsuit alleges that Explore failed to make more than $100,000 in employer contributions to the plan.
The lawsuit claims that Explore's owner and president, Jaime Gonzalez, and the plan's administrator, Paul Gong, violated ERISA laws by using employee contributions with the company's assets to pay general operating expenses.
The Department of Labor's lawsuit seeks restoration of fund losses, including interest, and removal of Explore as a plan fiduciary.
Meanwhile, BP faces an ERISA lawsuit of its own in the wake of the Gulf of Mexico oil spill. A former BP employee who participated in BP's retirement plan filed the lawsuit asking for unspecified damages. Bloomberg reported on 6/25/10 that the employee, Ralph Whitley, seeks to represent plan participants and beneficiaries whose accounts held BP American depositary shares.
The lawsuit alleges BP's retirement plan assets were imprudently invested in BP American depositary shares, a violation of the defendants' fiduciary duties. The lawsuit claims that plan fiduciaries mismanaged the plan and concealed BP's true financial and operating conditions.
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According to Pensions & Investments on 6/29/10, the lawsuit alleges State Street Bank & Trust had the authority to liquidate BP stock fund but did not do so. The lawsuit further claims that the plan's assets were invested in BP American depositary shares even though the defendants knew or should have known about inadequate safety protocols for oil and gas operations.
BP's stock price has dropped dramatically since the oil spill.