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Mercedes Benz employees missed out on 401(K) earnings because the company mismanaged the fees on the account, according to a lawsuit filed by two employees who participate in the company plan.
The plaintiffs say the carmaker’s financial mismanagement resulted in more meager retirement accounts for its employees primarily because Mercedes Benz used high priced record keeping and advisory services, the cost of which ate into benefit balances. Approximately 4,000 Mercedes Benz 401(k) plan participants were affected by the mismanagement, the complaint alleges.
“Defendants did not engage in prudent decision-making processes, as there is no other explanation for why the Plan paid these objectively unreasonable fees for retirement plan services,” the suit says.
Employees allege in the class action lawsuit that Mercedes violated a federal law that protect retirement accounts. ERISA, or the Employee Retirement Income Security Act, protects retirement accounts, along with disability benefits, irecord keeping, and account management.
Mercedes Benz 401(k) Mismanagement
The class action lawsuit alleges that plan participants up to 10 times as much as they should have in retirement plan service fees for their 401(k)s, maybe more.
The Mercedes Benz 401(K) plan comprises more than $500 million in assets, according to the complaint. The plaintiffs claim the company could have leveraged the buying power of its 401(k) plans to secure competitive administrative fees. Instead, say the plaintiffs, Mercedes failed to obtain plan managers that monitored investment fees appropriately.
Specifically, the class action lawsuit points out that plan participants paid between about $300 to over $500 per year for retirement plan services, when the going rate was approximately $53 per year. The plaintiffs also claim that plan participants were dinged with double fees for retirement account services.
Despite adding around 700 plan participants since 2016, account fees have only gone up, the suit claims. The class action lawsuit seeks to represent Mercedes Benz 401(k) plan participants and beneficiaries.
Do you have a Mercedes Benz 401(k) plan or other retirement plan you are concerned about? We want to hear from you! Tell us about your experience in the comment section below.
The plaintiffs are represented by James B. Eubank and W. Daniel Miles III of Beasley Allen Crow Methvin Portis & Miles PC.
The Mercedes Benz 401(k) Class Action Lawsuit is Case No. 7:21-cv-00074, in the U.S. District Court for the Northern District of Alabama.
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12 thoughts onMercedes Benz 401K Plan Challenged in Class Action Lawsuit
What do you expect out of a company who is philosophy is based on more with less.Would like to join the class action lawsuit as well.
I work there too and I wanna join as well
I have a Mercedes Benz 401k retirement account and would like to join the class acton lawsuit. I work at MBUSI in Vance, AL.
I have worked for this company for 23 years. I thought they could handle my investments properly
You can’t even understand the statements when you do get them. So much for being one big family. They need to make it right.
I’m glad someone is watching this stuff so colostomy, I had no idea what the going rate for these fees was supposed to be, if this is in fact accurate I’m pissed! I plan to retire this year…if my wife lets me…..
Add myself to this lawsuit, as a contributor since 1996.
I kinda knew something was not correct for the number of year that I work. Shame, Shame ?
I need in
Things like this don’t surprise me. The majority of people (including myself) don’t really understand how much we were being charged. If it was done I correctly well then it needs to be fixed.
INCORRECTLY
not I correctly
That so messed up and I need my money.