-- Company brought disclosure violations to attention of authorities after internal investigation uncovered reporting issues
CHICAGO, May 3, 2012 /PRNewswire/ -- Life Associates, Inc., a retirement plan administrator headquartered in Illinois, today stated that the federal indictment of a former company executive was appropriate. "The company brought this issue to the attention of federal authorities 14 months ago and has diligently cooperated and supported the investigation. We believe that, as stated in the indictment, the charges are appropriate," stated Ken Krupp, general manager of Life Associates. The indictment accuses the former executive of not disclosing to clients that proceeds were received from the demutualization of the financial company that serviced Life Associate clients' investment plans.
It is important to note that investment plans managed by the company were neither affected nor ever exposed to additional risk by the acts of this one individual. However, the former executive had an obligation to notify clients of how the company intended to utilize the demutualization proceeds and authorities allege that did not happen.
"The selfish actions of one individual led to this unfortunate event," Krupp added. "It has been difficult and expensive for our company to unravel, but we have done so successfully. We are proud of the firm hand that our president, Lori Lawlor, took in first launching the investigation and then bringing it to the attention of authorities. And we are indebted to our clients for their support."
The company added that it intends to pursue all avenues available to maximize the recovery of the converted funds.