Talk about your basic breaches of fiduciary duty! The Department of Labor announced this week that it has filed a lawsuit against now defunct Elkridge, Md.-based computer forensic company Jones Dykstra and Associates Inc. and its co-owners for failing to remit nearly $44,000 in participant and employer contributions to the company’s 401(k) profit sharing plan for a period of five years.
Acting U.S. Secretary of Labor Julie Su filed the lawsuit on Jan. 8, 2024, after an investigation by the DOL’s Employee Benefits Security Administration found the company violated ERISA. Specifically, co-owners and fiduciaries Keith Jones and Bryan E. Dykstra failed to remit $43,894.76 in participant and employer contributions to the company’s defined contribution 401(k) plan from January 2016 through 2021.
“Under the Employee Retirement Income Security Act of 1974, fiduciaries must act with prudence and undivided loyalty to plan participants and refrain from engaging in the sort of prohibited actions alleged here,” said Employee Benefits Security Administration Regional Director Cristina O’Brien in Philadelphia.
Filed in the U.S. District Court for the District of Maryland, the complaint seeks restoration of all plan losses including interest and/or lost opportunity earnings, removal and fiduciary bar, appointment of an independent fiduciary paid for by the fiduciary defendants and preservation of all books and records relating to finances and administration of the company and plan.
The lawsuit claims the fiduciary defendants consistently withheld employee contributions from employee paychecks for the stated purpose of remitting the money to employees’ 401(k) plan accounts. They did not however, remit all employee contributions to the plan, instead allowing the money to remain unsegregated in the company’s general operating account. During this same time period, Jones and Dykstra also failed to ensure that all employer matching contributions for employees were made to the plan. They also failed to process requests for participant distributions from the plan.
Jones Dykstra and Associates Inc. was founded in January 2007 and provided computer forensics, electronic evidence discovery, litigation support, and commercial security training to commercial and government clients. The company established the 401(k) plan effective on January 1, 2011.
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Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.