Employee pension plans are routinely invested in company stock, as well as other investments. Plan managers have active control over money invested to fund defined benefit plans. While defined contribution plans like 401Ks give workers more control over their own investment choices, plan sponsors often still play an active role in the management of pension assets. To protect employees and ensure their pension funds are safe, the Employee Retirement Income Security Act (ERISA) imposes obligations on plan sponsors and managers.
When employees sustain plan asset investment losses it is imperative to determine if a breach of fiduciary duty was the cause. Employees affected by financial loss may have a case against their employer, plan sponsor and managers, and others who may have breached a fiduciary obligation.
ERISA law attorneys help clients to determine if a breached duty was the cause of their financial harm and provide assistance in the identification of all defendants who were responsible for the losses experienced. Zamansky LLC knows not just ERISA but also securities laws, and can help to identify when investment irregularities or imprudent investments could constitute a breach of fiduciary duty. To speak with an investment losses lawyer to determine your legal options, give us a call now.
When Can You Take Legal Action for Plan Asset Investment Losses?
Investments sometimes lose money, and plan managers are not expected to always make investments that increase in value. However, as part of the plan manager’s duty to workers who depend upon their pension plans, those who manage and advise on pension plan investments must take many steps to limit losses and reduce risks, including:
- Diversification of investment portfolios
- Limiting the purchase of company stock shares
- Actively managing and monitoring investments
- Making prudent investment choices
If plan managers fail in any of their obligations or engage in other fiduciary breaches that cause asset loss, such as taking kickbacks for unwise investments, entering into transactions in the fiduciary’s own interests, or charging excessive plan management fees, the fiduciaries can be sued in a class action ERISA claim.
In some cases, plan asset investment losses are not only caused by plan managers making unwise choices, but by bad decisions on the part of companies that cause stock losses. If the employee has invested in company stock and a stock drop occurs because of bad news or bad business decisions, the employee could also pursue a case against company officers and claim a violation of fiduciary obligations.
Recovering Compensation for Loss of Pension Plan Assets
When pension plans lose money employees are harmed by the loss of their future financial security. Class actions are common solution, allowing plaintiffs to join together in one case against those responsible. ERISA class action cases for loss of pension plan assets are also accompanied by securities fraud claims in many situations, as employees seek to obtain monetary compensation under the Securities Exchange Act as well as the Employee Retirement Income Security Act.
Zamansky LLC can help you put together a comprehensive legal strategy aimed at exploring all avenues for recouping lost assets. Call today to schedule a consultation with an investment losses lawyer to learn more about why you should choose our firm when you need ERISA law attorneys to help you.