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News Release

U.S. Department of Labor For Immediate Release


Office of Public Affairs Date: March 20, 2002
Chicago, Ill. Contact: Sharon Morrissey
Release No. 160 Phone: (202) 693-8664

Michigan Plan Trustees Resign and Restore $597,775


To Millwrights’ Supplemental Pension and Health Plans

Detroit, Mich. – The trustees and the former administrator of the Detroit, Mich.-based Millwrights Local 1102
supplemental pension and health plans agreed to restore $597,775 to the plans. National City Bank of
Cleveland, Ohio, was appointed as an independent fiduciary to manage certain participant and non-participant
mortgage loans, according to a settlement reached on March 19 by the U.S. Department of Labor.

Under the judgment, the trustees were ordered to resign their positions with the plans. The court also ordered
the pension plan to comply with the requirements of the Employee Retirement Income Security Act (ERISA) in
any future lending or investment activity and gave National City Bank authority to manage the participant and
non-participant mortgage loan portfolio of the pension plan. National City Bank exercised that authority and
sold the pension plan’s participant and non-participant mortgage loan portfolio for $1,173,813.40.

The judgment resolves a suit filed Aug. 23, 2000 against third-party administrator Automated Benefit Services,
Inc. (ABS) and trustees Walter R. Mabry, Jerry D. Moore, Ronald M. Krochmalny, Keith R. Scrutton, Milford E.
Woodbeck, Sr. and Roy Shields. The suit alleged the defendants violated ERISA by paying unreasonable
compensation and fees to ABS, failing to prudently invest the plan’s cash assets, paying excessive fees relating to the
collection of employer contributions owed to the plans, and making mortgage loans to participants which did not
comply with the terms of the pension plan document.

The case resulted from an investigation conducted by the Labor Department’s Detroit District Office of the Pension
and Welfare Benefit Administration (PWBA). The consent judgment was entered in the federal district court in
Detroit.

“Our action reaffirms the department’s commitment to protect the benefits promised to employees,” said Paul
Baumann, acting district supervisor in PWBA’s Detroit Office.

Employers and workers can reach the Detroit PWBA Office at (313) 226-7450 for help with problems involving
private-sector pension and health plans.

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(Chao v. Walter R. Mabry, et al)


Civil Action # 00-73747 (Judge Avern Cohn)

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