• Paused
    Veterans Day
    Airport Workers
    Veterans Cemetery Districts
    Federal Workers
    Irrigation Districts
    Wastewater Treatment Workers
    Water Districts
    Superior Courts
    Road Workers
    Police Officers
    Download Our App!

    Member Login


    Not registered yet?
    Click Here to sign-up

    Forgot Your Login?
    Contact Elected Officials!
    Important Links
    Laborers Int'l Union of N. America
    Laborers Health and Welfare Trust
    LiUNA Industrial Pension Plan
    Goyette & Associates Attorneys
    Novey Law Group
    LiUNA Pacific SW Region
    Equal Employment Opportunity Commission
    Public Employee Relations Board/California State Mediation & Concilliation Service
    Site Search
    Site Map
    RSS Feeds
    Action Center
  • US Labor Department reaches $5.25M settlement with GreatBanc Trust
    Updated On: Nov 05, 2021
    WASHINGTON — The U.S. Department of Labor has reached a $5.25 million settlement with GreatBanc Trust Co. resolving department allegations that the Lisle, Illinois-based company violated the Employee Retirement Income Security Act. In 2006, GreatBanc, as trustee to the Sierra Aluminum Co. Employee Stock Ownership Plan, allegedly allowed the plan to purchase stock from Sierra Aluminum's co-founders and top executives for more than fair market value.

    "The benefit of this settlement is two-fold: The Sierra Aluminum plan will recoup a significant amount of money, and perhaps more importantly, safeguards will be put in place to protect ESOPs involved in any future GreatBanc transactions," said U.S. Secretary of Labor Thomas E. Perez.

    GreatBanc and its insurers will make $4,772,727.27 in payments to the ESOP and pay $477,272.73 in civil penalties. The company has also agreed to put safeguards in place whenever the company is a trustee or fiduciary to an ESOP that is engaging in transactions involving the purchase or sale of employer securities that are not publicly traded. The safeguards include requirements for: the selection of a valuation advisor and the oversight of the advisor, the analysis required as part of the fiduciary review process, and the required documentation of the valuation analysis.

    "Others in the industry would do well to take notice of the protections put in place by this agreement," said Assistant Secretary of Labor for Employee Benefits Security Phyllis C. Borzi. "ESOPs are an important tool to promote employee ownership, not a way to create big cash-outs for owners and top executives."

    The settlement resolves a 2012 department lawsuit that alleged GreatBanc failed to adequately inquire into an appraisal that presented unrealistic and aggressively optimistic projections of Sierra Aluminum's future earnings and profitability. GreatBanc allegedly failed to investigate the credibility of the assumptions, factual bases and adjustments to financial statements that went into the appraisal. The suit also alleged that GreatBanc asked for a revised valuation opinion in order to reconcile the ESOP's higher purchase price with the lower fair market value of the company stock.
    Sierra Aluminum principal place of business is Riverside, California. The company produces extruded aluminum products for use in various industries, such as construction and transportation. The ESOP had 385 participants as of the end of December 2012.

    EBSA's Los Angeles Regional Office conducted the investigation that led to the lawsuit. The case was litigated by the department's Office of the Solicitor in Washington, D.C. Workers and employers who have questions or concerns about a benefits plan can contact a benefits adviser at http://www.askebsa.dol.gov/ or by calling 866-444-EBSA (3272).

  • UPEC - LiUNA Local 792

    Copyright © 2021.
    All Rights Reserved.

    Powered By UnionActive

    475224 hits since Dec 09, 2013

  • Top of Page image