The U.S. Department of Labor and Los Angeles-based WesternMixers Inc., a fruit and nut company, have reached an agreement torestore a total of $1,287,901 to the company's pension plan.

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Under this consent judgment, which was entered this month in theU.S. District Court's Central District in Los Angeles, officers ofWestern Mixers are responsible for restoring $802,901 toparticipants' accounts within 10 days. During the investigation,Western Mixers repaid $485,000 to the plan for the total fundsidentified as missing.

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With this agreement, unpaid contributions, unauthorizedwithdrawals and interest are to be fully recovered, which comesafter an investigation by the Los Angeles Regional Office of theLabor Department's Employee Benefits Security Administration.According to the investigation, the company and two officers whoacted as plan trustees over a five-year period did not makeapproximately $952,511 in mandatory employer contributions for thebenefit of participants as well as beneficiaries.

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The investigation also discovered that the same two officers andWestern Mixers’ chief financial officer made $565,000 inunauthorized withdrawals from the plan accounts. Along withrepaying the missing funds with interest, the defendants are alsoreceiving a penalty equal to 20 percent of the recoveredamount.

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"This case demonstrates a clear breach of fiduciary duty," saysPhyllis C. Borzi, assistant secretary of labor for employeebenefits security. "Employers hold positions of trust that areviolated when money intended for retirement benefits is directed tosome other use. Individual trustees have a duty to protect aretirement plan and, as in this case, may be personably liable forthe funds. The Labor Department is committed to protecting workers'retirement funds so that they can continue to provide forthemselves and their families during retirement."

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The court has selected an independent fiduciary to eliminate theplan and collect, marshal, pay out and administer plan assets.Western Mixers owners Frank L. Rudy and David H. Bolstad are nolonger plan trustees and fiduciaries, and Robert J. Fischer, chieffinancial officer of Western Mixers, along with Rudy and Bolstadare permanently enjoined and restrained from violating the EmployeeRetirement Income Security Act as well as from serving as fiduciaryor service providers to any ERISA-covered plan in the future.

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EBSA is responsible for protecting the security of theretirement, health and other workplace-related benefits andoversees roughly 707,000 private sector retirement plans, 2.5million health plans and other plans that cover benefits to morethan 140 million Americans. In total, these plans contain more than$6 trillion in assets.

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