Department of Labor Audit Case Study

Department of labor pursued $240,000 in penalties for self-dealing.

Between the plan trustee and the plan.

Smith Schafer Approach

During this audit, we defended the client, which included identifying regulations that could be interpreted to plan trustees actions and title drafting errors for plan assets. We negotiated with the Department of Labor to replace the company owner as a trustee with a bank as a corporate trustee. This process allowed the Department of Labor auditors to feel like they had accomplished something to protect the plan participants.


The company hired a bank as corporate trustee, and no penalties were paid to the Department of Labor. We have defended several plans before the Department of Labor, and none have been assessed penalties.