A life insurer has agreed to pay nearly $17 million back to benefit plans that invested in a pooled separate account holding plan.
Union Labor Life Insurance Company, Washington, has agreed to repay fees and compensation to benefit plans that invested in the plan, Separate Account J, according to officials at the U.S. Department of Labor.
The settlement still must be approved by federal district court in Washington.
Separate Account J invests in mortgages secured by real estate projects built by union labor. The sole investors are employee benefit plans, the Labor Department says.
The Labor Department filed a suit alleging that ULLICO failed to get approval from independent plan fiduciaries for moves to take funds directly from the investment account. The department also found fault with the way ULLICO handled loan commitment fees, construction administration fees, lender inspection fees and other payments received from borrowers.