MIAMI, FL – After an investigation by the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA), the U.S. District Court for the Southern District of Florida entered a consent judgment and order between the U.S. Department of Labor and Kevin F. Kirkeide, a former chief financial officer for IOTC Financial Services LLC and Global Oil Financial Services LLC – both based in Boca Raton, Florida. The order permanently enjoins Kirkeide from violating the provisions of Title I of the Employee Retirement Income Security Act (ERISA) and from acting as a fiduciary, trustee, agent or representative in any capacity to any employee benefit plan as defined by ERISA. In addition, $538,248 in restitution has been paid.
EBSA investigators determined that from January 2011 through December 2014, Kirkeide – serving as a trustee and fiduciary to the IOTC Financial Services LLC 401(k) Profit Sharing Plan and the Global Oil Financial Services LLC 401(k) Profit Sharing Plan – worked with IOTC and Global Oil owner Harry Sargeant to withhold tens of thousands of dollars from employees’ paychecks, but did not forward these employee contributions to the plans, or did not forward them in a timely manner. Kirkeide and Sargeant also failed to collect and remit required employer contributions to the plans.
The Department of Labor filed an amended complaint on June 4, 2018, alleging that Kirkeide and Sargeant failed to segregate employee contributions to the plans from the companies’ assets as soon as reasonably possible, and failed to remit and/or timely remit these contributions to the plans. The complaint also alleged both individuals failed to administer the plans, leaving participants unable to gain information about their funds or gain access to their plan accounts.
Sargeant has agreed not to violate Title I of ERISA, and not to serve as a fiduciary to any employee benefit plan as defined by ERISA in the future. In addition, Kirkeide and Sargeant have paid $538,248 in restitution to the plans’ affected participants, which includes delinquent and unremitted employee and employer contributions from January 2011 through December 2014 and associated lost earnings. Both individuals agreed to terminate the plans using AMI Benefit Administrators Inc. as a successor fiduciary.
“Consent judgments such as this one identify bad actors, compel them to make benefit plans financially whole, and prevent them from doing further damage,” said Lawrence Thompson, EBSA Deputy Regional Director in Atlanta. “The U.S. Department of Labor will continue to pursue all legal recourse to ensure employees keep the benefits they have rightfully earned.”
Employers and workers can reach EBSA toll-free at 866-444-3272 for help with problems related to private sector retirement and health plans. Additional information can be found at http://www.dol.gov/ebsa.