Never miss a story — sign up for PLANADVISER newsletters to keep up on the latest retirement plan adviser news.
Compliance July 9, 2010
MA Business Owner Misused Retirement Plan Money
A business owner in Holyoke, Massachusetts, has pleaded guilty to embezzling $45,000 from his employees' retirement plan.
Reported by Rebecca Moore
The Republican reports that A. Ross Scott, owner of ARS Strategic Mailing, admitted that money he deducted from his employees’ paychecks never made it to a Payne Webber investment account, and that he also failed to contribute pledged matching funds.
A lawyer for Scott said he used the money to keep his faltering business afloat and that the handful of workers he employed had consented to the plan. However, Assistant U.S. Attorney Kevin O’Regan disputed this during a hearing in U.S. District Court and told the judge Scott used the money for personal reasons, according to the news report.
Charges filed in May say Scott didn’t invest about $26,000 in employee contributions between 2002 and 2007 and didn’t contribute the 3% in matching funds he promised under the retirement plan. He also falsely claimed the money as a business expense on his tax returns.
Scott faces up to 16 months in prison.