Pension funds are made up of contributions from employers, unions, or other organizations and are intended to provide retirement benefits to employees. Unfortunately, pension funds are often targeted by those involved in fraudulent activity and in an effort to crackdown on white collar crime, many innocent people are charged with pension fund fraud. Having the guidance and support of an experienced white collar crime attorney can make all the difference in the outcome of a case, so if you are currently being investigated for fraudulent activity involving a pension fund, it is crucial to speak with an experienced white collar crime attorney who can represent your interests.
Pension Fraud Defined
Pension fraud involves the use of misrepresentation or deceit in connection with a pension fund and typically involves one of two situations:
- Fraudulent activity related to providing pension benefits; and
- Fraud aimed at collecting pension funds that do not belong to the account holder.
The first type of fraud usually involves conflicts between an employer and an employee, while the second type often involves misappropriating another person’s pension. For instance, a third party who is entrusted with managing a pension holder’s assets could be charged with a criminal offense if he or she is convicted of commingling assets or using the funds for personal gain.
Employer/Employee Pension Fraud
The Employee Retirement Income Security Act (ERISA) creates certain standards with which private employers must comply. For instance, employers are required to provide plan participants with important information about their fund, including its major features and how it will be financed. Employers who fail to comply with these rules or who wrongly withhold benefits can be sued by the employees for breaching their fiduciary duties.
Many employers who are charged with committing pension fraud were not even aware that their actions constituted fraud. For instance, some employers are investigated for the following reasons:
- Failing to fund a pension appropriately;
- Mismanaging pension investments;
- Miscalculating benefits;
- Improperly denying benefits to an employee;
- Misappropriating a pension holder’s data;
- Misrepresenting the amount of payments that a retiree will be paid each month;
- Providing false information regarding the transferability of pension rights;
- Tax or insurance fraud connected with the pension;
- Skipping required contributions to pay other business expenses; and
- Investing more than ten percent of pension funds into the company’s own stock.
A simple miscalculation or accounting error could lead to serious charges of pension fraud, so if you manage employee pension funds and are being investigated for fraud, it is critical to contact a white collar crime attorney who can help you formulate a defense.
Employees can also be charged with pension fraud if they:
- Attempt to claim more benefits than they are entitled to;
- Submit falsified records, such as improper birth certificates, divorce decrees, medical records, or accident reports; and
- Continue to work at another public job during retirement.
Pension fraud can lead to both civil and criminal penalties, which means that defendants who are convicted could face jail time in addition to being required to compensate the plaintiff for:
- Improperly denied benefits;
- Interest that accrued while benefits were withheld; and
- Attorney’s fees.
Defendants could also face hefty fines. For instance, those who are convicted of pension fraud may be required to pay as much as $500,000 in fines.
Contact an Experienced White Collar Crime Attorney Today
Please contact Jeffrey S. Weiner, P.A. Criminal Defense Attorneys at 305-670-9919 to speak with an experienced South Florida white collar crime attorney who can evaluate your case.