A federal grand jury in Texas has indicted Jeffrey and Wendy Richie on claims that they stole $14.5 million from at least 1,000 plan participants in at least 20 retirement plans.
The Richies – Jeffrey, the President and CEO of Vantage Benefits Administrators Inc., and Wendy, VP of Administration for the firm, and wife of Jeffrey – were charged with aggravated identity theft, wire fraud and theft from an employee benefit plan.
The indictment outlines how Wendy Richie, “who handled primarily the financial matters of VBA,” according to the indictment – with her husband's knowledge and approval, beginning in or about 2014, and continuing through 2017, made fraudulent requests for distributions from the funds managed by Vantage’s clients on behalf of an employee, or purported employee, of the company who sponsored a retirement plan administered by VBA. However, rather than directing the money to be transmitted to an account designated by the purported employee, the money was sent to an account operated by Vantage, according to the indictment.
Those funds were, in turn, used for Vantage’s operating costs, including the company's payroll, and were also transferred to the Richies’ personal bank account, and “used to acquire assets and pay for personal expenses,” including escrow and mortgage payments on the couple’s residence, farming equipment (“a 4-wheel drive Kubota cab diesel tractor, with a front-end loader, single spike bale spear, rotary cutter and ATV tires”), and home décor (“replacement of the breakfast room floor, the purchase of hand scraped wood, and labor, electrical, and carpentry for a custom mantle at the defendants’ residence”), according to the indictment.
The indictment indicates that the couple will be required to forfeit any assets traceable to the alleged offenses if convicted. The couple also faces up to 81 years in federal prison if convicted on all counts, according to a press release from the Justice Department.
The action followed an Oct. 31, 2017 raid by the Federal Bureau of Investigation on the offices of Vantage Benefits Administrators “amid concerns that money may be missing from retirement accounts the company manages.” Vantage Benefits described itself as a full-service TPA specializing in corporate benefit programs, with a focus on small plans (under $10 million). To date, several of the plans impacted by the theft have filed suit against Vantage (a default judgment was handed down by Judge David C. Godbey of the U.S. District Court for the Northern District of Texas earlier this year). More recently, Matrix Trust Company – custodian for the plans administered by Vantage Benefits – was added as a party to a suit, with the plaintiffs there charging that Matrix was a functional fiduciary – a claim that Matrix Trust has rejected.
The case is U.S. v. Richie et al., case number 3:18-cr-00540, in the U.S. District Court for the Northern District of Texas.