Bank of America Ordered to Face 401(k) Forfeiture Use Lawsuit

A lawsuit challenging how Bank of America Corp. handles 401(k) contributions forfeited by departing employees is moving forward after a federal judge greenlighted claims of fiduciary breach and violations of federal benefits law.

Courts have “come to different conclusions” about what qualifies as a fiduciary breach under the Employee Retirement Income Security Act, and the allegations against Bank of America are enough to move the case forward into discovery, Judge Max O. Cogburn Jr. said Tuesday. Plan participants also advanced claims under ERISA’s anti-inurement provision—which prohibits employers from using retirement plan assets for their own benefit—and the statute’s prohibited transaction ...