DOL Recovers Assets for Kentucky Pension Plan
Consent judgments were obtained against Robert La Courciere and Pamela Babbish, former trustees of the Fourslides Inc. pension plan. These judgments follow the recovery of $490,594 owed to the plan. A lawsuit filed by the DOL in the U.S. District Court for the Eastern District of Kentucky alleged that over three years, La Courciere, Babbish, George Hofmeister and Fourslides Inc. improperly used pension funds. Judgments against the remaining defendants are being sought by the DOL in ongoing litigation.
The DOL’s lawsuit alleges that La Courciere, Babbish, Hofmeister and Fourslides engaged in a series of prohibited transactions involving the Fourslides pension plan beginning in March 2006. La Courciere and Babbish were alleged to have caused the transfer of plan assets to Fourslides and the payment of excessive fees to service providers, while La Courciere also entered into a prohibited loan of nearly half the plan’s assets to a party-in-interest. Hofmeister was alleged to have directed each of the companies that engaged in the improper loan, benefitted from the loan, and took no action to remedy these prohibited transactions.
These consent judgments permanently bar La Courciere and Babbish from serving as fiduciaries to any plan governed by the Employee Retirement Income Security Act (ERISA) and enjoin them from violating ERISA.
The DOL has also filed separate lawsuits seeking to recover losses to other pension plans sponsored by companies related to Lexington-based Revstone Industries LLC, an affiliate of Fourslides. Revstone and its various affiliates, including Fourslides, were directed by Hofmeister and owned by the irrevocable trusts of Hofmeister’s children.
These suits allege many other ERISA violations, including the prohibited use of plan assets for the purchase and lease of company property, prohibited purchase of customer notes from affiliated companies, prohibited transfer of assets in favor of a party-in-interest, payment of excessive fees to service providers and payment of fees on behalf of the affiliated companies.