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ESOP and Illegal Activities
Old 09-19-2014, 01:58 PM   #1
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ESOP and Illegal Activities

*I currently work for [mod edit] and we have an ESOP.

I just discovered some information about our ESOP on the internet at [mod edit]
*
Is what they did illegal and should I contact the Department of Labor?

I cannot retire without all my ESOP money.
*
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Old 09-19-2014, 06:52 PM   #2
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Time for the stockholders to hire an attorney.
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Old 09-19-2014, 08:31 PM   #3
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I'm not sure if it's illegal. In reading that blog - it suggests that anyone requesting a lump sum, who's over 65, can get the lump sum.

The part that the wording is akward on is what happens to those under age 65. If they get the distributions they always got (which it sounds like they do) then nothing has changed for them. They weren't given the new lump sum given those over 65 - but they had never been offered a lump sum previously... so no new harm. But the blog talks about diverting money FROM them to those over 65. If that means they can't even get the annual payment for the portion owed over the 5-10 year schedule... that's a problem. That's a new harm.

I'd be curious if anyone besides the former CEO qualified for the lump sum. I would imagine a few folks probably did. As long as it wasn't limited solely to the CEO dude, it's probably legal.

But further down it suggests that even those who were over 65 were denied the lump sum. That sounds problematic.

I don't know the company... but if this is true - a big portion of their retirement accounts is being monkeyed with.
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Old 09-19-2014, 10:27 PM   #4
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Wow, what a bad situation for anyone needing the money. It's such a small co, (112 million in sales) that a big legal battle , if lost could force it into BK , and everyone left will lose most of the value. Not being an atty. , no idea of how far claw-backs could go in a BK.

The blog infers that those who raised a stink were accommodated , at the determent of others.

Kind of late to do anything now, other than to try and force out management , who are also co-owners along with you. Not likely to work.

Good luck.
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Old 09-19-2014, 10:52 PM   #5
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Other things to consider: A lot of these small co. executives take a large part of compensation in the form of company stock , instead of a large cash salary.
Lower level employees usually don't have that kind of employment agreement, even if they wanted to.

Not planning for such a payout upon an executive leaving is poor management of the co.

Is it wrong for someone who did so to get his differed salary payout when leaving ?
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Old 09-22-2014, 01:29 PM   #6
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Lakewood90712,

Thanks for your input.

I think what [mod edit] ESOP did is [mod edit]

The site [mod edit] references some rules and regulations on another site [mod edit - link removed] *Case # 1 is exactly what we have here.

I think I will contact the Department of Labor and see if they can help.

I will see if I can remain anonymous, as I do not want to lose my job.

Any advice?
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Old 09-23-2014, 08:45 AM   #7
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We had to work with Department of Labor, they were excellent at getting to the bottom of situations. They did have to disclose IDs, but it was due to the nature of the specfic complaint. I don't have enough legal knowledge to help. I would say, a bunch of attorney's did the paperwork, there's a chance they made mistakes. Legal or not, from the information presented here it appears wrong. Best Wishes.

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Old 09-23-2014, 10:59 AM   #8
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You can hire an attorney to file the complaint with DOL on your behalf which should keep your identity secret. Make a copy of the material that supports your concern.
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Old 09-23-2014, 01:12 PM   #9
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I will file an online complaint with the Employee Benefits Security Administration:
https://www.askebsa.dol.gov/WebIntake/Home.aspx
*
I will ask in my complaint, to remain anonymous and I will provide them with the link[mod edit] in my complaint about [mod edit] ESOP.
*
I assume the Government won’t tell my employer my identity. * *
*
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