Rithm Capital Subject of Latest 401(k) Forfeiture Allegations

A former Rithm Capital LLC employee filed a proposed class action saying the company enriched itself from its workers’ 401(k) plan by using forfeited contributions for its own benefit.

The asset manager is one of dozens of employers to be sued for putting the unvested 401(k) contributions forfeited by departing workers toward the amounts it’s required to contribute to the plan, instead of using them to reduce workers’ expenses. Rulings in these cases, which also target Meijer Inc., Verizon Communications Inc., and Cigna Group, have largely favored employers, and the US Labor Department has opposed this ...