Question My Company was bought by another company. The profit sharing from the old company had to be terminated. We were told that the plan would go under a blackout period for up to a year while the IRS made sure everything with the plan was legitimate before the Company could make distributions to the employees. The original notification was given February 2011. It is now Oct 2012 and as of this day I have not received my money. There is a significant amount of cash being withheld from me as well as the other employees of the company that we are unable to roll over into our chosen investment accounts and are now losing a lot of money as a result. I have still not been given a firm date for dispersal nor written explanation as to what is happening and why. What recourse do I have and is there liability for lost investment income?
That is an odd situation. Usually, when a company is bought-out the procedure is to merge the plans together, or to rollover the assets into a new plan. When the pension plans are merged there is a short black out period, usually around 10 days, but it should not be anywhere close to a year. Employers have a fiduciary obligation to make sure these plans are transferred effectively and within the specified legal time frame. It does not sound like this is happening with your plan. I would start by looking up your company's old plan at the Department of Labor website. They have an area for abandoned plans. One thing I can tell you is that the money in your 401(k) is your money. It cannot be confiscated by the company or anyone else legally.
Check this website for your company's plan and see if it brings up any information.
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I have over 10 years experience regarding pension plan management including; investment fiduciary services, plan structure and design, plan administration, employee education, Uniform Prudent Investors Act (UPIA) services, overall plan management consulting, Employee Retirement Income Security Act (ERISA) law and Department of Labor (DOL) law.
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Independent Pension Fiduciary
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