Compliance September 22, 2022

All 3 Defendants Move to Dismiss Cybersecurity ERISA Suit

The defendants are accused of ignoring several red flags, resulting in over $750,000 being stolen from a retirement account.

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The Colgate-Palmolive employee relations committee, plan recordkeeper Alight Solutions and custodian Bank of New York Mellon Corporation have all filed to dismiss an Employee Retirement Income Security Act lawsuit brought by Paula Disberry, an employee of Colgate-Palmolive from 1993 to 2004.

Disberry’s complaint states that last September, she was informed after unsuccessfully trying to log in to her account that her entire balance of $751,430.53 had been withdrawn in one lump sum.

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The total was taxed and penalized for early withdrawal, since Disberry was 52 at the time. BNY Mellon sent a check for $601,144.42 to an address in Las Vegas, though Disberry has been a resident of South Africa since 2008.

She charges that Alight missed several red flags. The fraudsters called Alight and asked to change Disberry’s contact info and address under her account. Alight then sent a temporary PIN to Disberry’s address in South Africa, which the fraudsters managed to intercept. Alight never contacted the previous phone number or email listed when they were changed, according to the suit, and never followed up when the fraudsters tried to withdraw the entire balance at once, though Disberry was younger than 59.5 years old and therefore subject to an additional tax penalty.

The thieves also tried to take Disberry’s balance from another retirement account managed by the Momentum Gibraltar Pension Plan, but failed due to their security measures, which included a phone and email alert to previously listed contacts, as well as a call to her financial adviser.

Last Thursday, the three defendants moved to dismiss the case. They cited Federal Rules of Civil Procedure 12(b)(6), which is a motion to dismiss on the basis that there is a “failure to state a claim upon which relief can be granted” on the part of the plaintiff. This motion asserts that even if everything the plaintiff alleges is factually true, it is insufficient to justify a lawsuit.

The legal teams representing the three defendants did not respond to a request for comment.

Products September 21, 2022

Wilmington Trust Introduces Digital CIT Onboarding Tool

Plan adviser users of the tool can automatically pull key data for the plan they are advising into the system from the data contained in the IRS Form 5500 database.

Reported by



Wilmington Trust has introduced the BoardingPass application to digitize and streamline the onboarding of collective investment trusts for employer-sponsored retirement plans.

The company hopes the application will increase the availability and use of CITs for employer-sponsored retirement plans by removing paperwork and implementing a digital onboarding process.

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The paper-based onboarding process is onerous for employer-sponsored plans wanting to use CITs, explains Rob Barnett, head of Wilmington Trust retirement distribution and product leader for CIT business, because a plan’s eligibility to invest in CITs must be confirmed through a retirement plan participation agreement.

“To invest in a CIT, a plan sponsor or its delegated fiduciary has to complete a participation agreement that really represents and warrants that they’re eligible to invest in this tax-qualified vehicle,” he says.

“That has left a lot of people to believe that the onboarding process for CITs must stay paper-based, and while we all work continually to try to make the paper-based process better, it really doesn’t allow for the democratization of the use of CITs. BoardingPass brings to pass the democratization of the retirement plan onboarding process, as well as adding CITs as plan options.”

The app serves as a central hub for all plan information. Wilmington Trust says rather than requiring an employer-sponsored plan to manage reams of paperwork, which can lead to errors and takes an average of one to five business days to submit, users of the web-based platform can shorten the timeline by up to 80%.

Plan adviser users of the tool can automatically pull key data for the plan they are advising into the system from the data contained in the IRS Form 5500 database; a Form 5500 is the annual report filed by employer-sponsored plans with the Department of Labor. The tool prepopulates the correct form fields with information on a plan’s financial condition, investments and operation.

Plan sponsors may be able to gain the benefit of real-time information-sharing and a digital connection to their critical service provider partners, according to a press release.

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