US - The Operating Engineers Local 324 Pension Fund has sued Fifth Third Bank to recover plan losses estimated at more than $20m arising from the mismanagement of the sale of some of the fund's property.
Fifth Third Bank subsequently reversed its development strategy and sold the property to the Cavaliere Group for only $4.5m in 2004. At the time the sale took place, the plan had invested more than $28m in the property.
Bradford Campbell, assistant secretary of the Labor Department's Employee Benefits Security Administration (EBSA), said: "The department's action protects the workers, retirees and their families who are counting on the Operating Engineers Local 324 Pension Fund for their retirement security."
Campbell continued: "In taking this legal action we are seeking to recover, with interest, all the funds that are owed to the pension plan."
The lawsuit was filed in the US District Court in Detroit; it alleged between 25 August 2003 and 1 October 2006 Fifth Third Bank served as an investment manager and fiduciary. The filing also implicated bank vice president John Schmitz as acting as a fiduciary and Carey Milestone Advisors as an investment advisor and fiduciary to the pension plan.
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