Fil-Am home health care owners ordered to return looted $1.6M
CHICAGO—A Filipino American-owned home health care provider and two of its top officers were ordered February 16 to repay their employees’ retirement plan a total of $1,736, 339.
The judge of the U.S. District Court for the Northern District of Illinois, Eastern Division in Chicago ordered retired Dr. Dalisay Sulit, 77, and her son Reginaldo Sulit, 47, president and secretary/treasurer, respectively, of Alliance Home Healthcare, Inc., to return funds taken from the employee retirement plan, according to a press release by the U.S. Department of Labor, which brought the case against the outfit and its owners.
The owners of Alliance Home Healthcare, located in Chicago’s southwest suburbs of Palos Hills and Worth, Illinois, failed to appear before a federal judge in all the hearings and no lawyer has represented them since the case was brought against them last August.
The Sulits’ non-action prompted the judge of the U.S. District Court to rule against them by default. In an investigation by the department’s Employee Benefits Security Administration (ERISA) in Chicago, Alliance and the Sulits were found to have improperly transferred and distributed $ 1,601,908 from the profit-sharing plan to themselves, the company, and others. The judgment also requires the trustees to repay lost opportunity costs of $134,431.
The judge also removed the defendants from their positions as fiduciaries to the plan, and permanently enjoined them from serving as fiduciaries or service providers to any plan covered by ERISA.
The court appointed Lefoldt & Co. P.A. of Ridgeland, Mississippi, as an independent fiduciary, compensated at the defendants’ expense, to distribute the plan’s assets to participants and beneficiaries and to terminate the plan.
Alliance Home Healthcare established the plan on Jan. 1, 2000, to provide retirement benefits to eligible employees. As of December 31, 2006 – the last year an annual report was filed – the plan had 127 workers/participants and $1.6 million in assets.
Alliance Healthcare is a tenant in this building in Palos Hills, Illinois and has an office also in Worth, Illinois.
Alliance provided health care services to patients in their homes. According to another source, the 21-year old company is now down to 20 employees.
In an interview with a reporter of the Chicago Tribune at a building at Chicago’s Magnificent Mile where Reginaldo Sulit owns a condo, the younger Sulit said that he and his mom did not personally benefit but used the money to keep their company afloat. “It’s our intention to pay everyone back,” he added.
The Labor Department did not buy their excuses. “This judgment is a victory for the participants in the company’s profit sharing plan,” said Assistant Secretary of Labor for Employee Benefits Security Phyllis C. Borzi in their press release.
“Too often, we see employee benefit plan funds used illegally by company owners and management to prop up struggling companies. Employee benefit plans must be managed in the best interest of participants, bottom line,” Borzi’s statement said further.
In the Tribune interview, Reginaldo Sulit complained of the unfairness of the ruling, but also admitted that no nurse ever received money from the Alliance Retirement Fund because they did not retire or they are not vested.
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