FROM: U.S. DEPARTMENT OF LABOR
US Labor Department lawsuit results in court order to return more than
$225,000 in retirement assets to Milwaukee company’s workers
Trustee ordered to restore funds to Losik Engineering Design Group employee benefit plan
MILWAUKEE – A federal court in Milwaukee has ordered Michael J. Losik to restore $225, 274 to the Losik Engineering Design Group Ltd. defined benefit retirement plan. Losik, the company’s president and owner, violated the Employee Retirement Income Security Act by imprudently investing plan assets in a hedge fund, by making an improper distribution to his own account, and by failing to properly administer the plan. The judgment resolves a lawsuit filed by the U.S. Department of Labor based on findings of an investigation by the department’s Employee Benefits Security Administration.
"The department is committed to holding accountable those who are entrusted with the assets of workers’ retirement plans," said Steve Haugen, director of EBSA’s Chicago Regional Office, which conducted the investigation. "We will continue to help workers obtain their rightful benefits when plan fiduciaries violate the law."
Under the terms of the consent order and judgment, Losik is liable to the plan for $225, 274—the amount he distributed to himself in 2008. He is barred from serving as a fiduciary or service provider to any employee benefit plan subject to ERISA in the future.
Additionally, the court appointed an independent fiduciary to liquidate the plan’s approximate $250,000 investment in a high-risk hedge fund that Losik authorized in 2007 and which now represents 100 percent of the plan’s assets. The independent fiduciary will also terminate the plan and distribute the assets to the 20 qualified participants. The plan allegedly has not been administered since October 2009. The company ceased operations on or before April 2011.
The case was litigated by the department’s Regional Office of the Solicitor in Chicago.
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