419 Plan Fraud Protection

At the law firm of Charapp & Weiss, our 419 plan fraud protection attorneys provide advice, counseling, and litigation representation for consumers who were harmed by defective 419 welfare benefit plans and the fraud and misrepresentation of plan promoters and insurance agents. With offices in Washington D.C., Maryland, Virginia, and Florida, the firm represents consumers located throughout the U.S.

What is a 419(e) welfare benefit plan?

A 419(e) plan is a type of employee welfare benefit fund, sponsored by an employer, used for the purpose of providing financial stability for employees in retirement. These plans offer many different benefits to employees, including life, health, disability, long-term care, and post-retirement medical benefits. In a 419(e) plan, there is no benefit pooling among different companies. Instead, the same company pays for all the plan benefits based on a target contribution or target benefit structure. Plan assets are generally held by an independent trustee, and are exempt from seizure by creditors of the company.

How insurance companies scam consumers

Despite the creation of regulations listing potentially abusive tax shelters (listed transactions) by the IRS, promoters continue to market plans to mislead consumers into believing the plan premiums are tax-deductible. While this benefits the promoters and agents in their sales and commissions, it has serious financial consequences for consumers, including tax penalties and the loss of benefits because of defunct plans. Typical fraudulent claims of promoters include the following:

  • Misrepresenting premiums as tax deductible
  • Fraudulently claiming plans are exempt from tax deduction limits
  • Failing to analyze whether insurance policies promoted are funds as defined by the IRC
  • Incorrectly claiming exemptions from compliance with ERISA or sections 409, 414, 419, 505, and 79 of the IRC
  • Improper tax deductions
  • Failure to cite the section of the IRC under which contributions to their plan are tax-deductible
  • Failed to comply with non-discrimination laws
  • Taking larger deductions than required to pay term insurance costs for the current tax year

Skilled 419 plan lawyers helping consumers

When a 419 insurance plan is defunct, consumers who have paid high premiums for years are left without the promised benefits, including much needed life, health, disability, long-term care, and post-retirement medical benefits. In addition, fraud or misrepresentation of an insurance company and its plan promoter can result in penalties by the IRS and other serious tax consequences.

Each 419 plan fraud protection attorney at Charapp & Weiss is dedicated to providing advice and counsel for consumers who have suffered harm from 419 plan fraud and misrepresentation. Often, litigation is the only solution available for consumers to obtain promised benefits. When this is the case, Charapp & Weiss attorneys have the experience and legal knowledge to represent clients in the courtroom and help recover unpaid benefits.

Sophisticated representation. Attentive service.

Contact a 419 plan lawyer at Charapp & Weiss today for more information about retirement and pension plan fraud protection and targeted solutions for your defective 419 welfare benefit plan.