King settles with financial institution
MONTGOMERY, Ala. (Legal Newsline) - Alabama Attorney General Troy King announced on Wednesday that he has reached a $16 million settlement with a financial institution that allegedly paid nearly $12 million to the Alabama State Employees Association in sponsorship fees and commissions.
Nationwide Retirement Solutions was dropped by the State Personnel Board as a provider of Alabama's deferred compensation plan earlier this year after the alleged sponsorship fees and commissions were discovered. Tens of thousands of state employees had contributed to this 457 Plan.
The termination of Nationwide Retirement Solutions as a provider and the alleged payments led to lawsuits among the parties and program participants.
"We have worked tirelessly to recoup a sufficient recovery to restore to the accounts of state employee participants that which was improperly diverted from them," King said.
"This settlement is great news for hard-working state employees and I am pleased that we have avoided expensive, protracted litigation while still righting a wrong that had been done to state employees."
More than 20,000 active and retired state employees who participated in Nationwide's plan between 2000-2009 will share in the settlement, which must now be approved by multiple state court judges.
The $16 million will be paid into the state's supplementary retirement plan.