401k fraud

[tiki144]

What is the name of your state? NY

I work for a small private company and found out that the company has not been depositing 401k withdrawals from employees check for almost a year but keep the funds and using them for business activities. The funds are managed by a 3rd party financial institution. What is the legal ramifications of this for the company? Are they responsible for lost opportunity on the funds with the market having gone up in the last year? Also what happens if the company goes bankrupt? Are the owners personally responsible for this?

 

[cbg]

Pick up the phone. Call the Department of Labor. Do not pass Go. Do not collect $200.

The ramifications of this are such that I don't even want to get into the details. Your employer is in very deep ****. The specific answers to your questions depend a great deal on the structure of the company and the plan document, but there is NO WAY that this is legal.

 

[Beth3]

Ditto! The phone number for the federal DOL is 202-693-4650.

This is the kind of thing that company owners/officers go to jail for.