(PR Newswire) COLUMBUS, Ohio — The African Methodist Episcopal Church (AME) and Plaintiffs (who represent a putative class of Plan Participants) have reached a contingent settlement agreement in the class action lawsuit concerning the misappropriation of retirement funds.
The settlement is contingent on Court approval, but marks a significant step forward in addressing the financial harm caused to retirement plan participants and underscores the Church’s commitment to its members.
Background
The AME Church was victimized by its own elected General Officer who, in coordination with several Defendants in this lawsuit, embezzled retirement funds and concealed the diversion of other retirement funds into unauthorized, risky investment vehicles over an extended period of years, for their own financial gain. The undisclosed diversion was discovered upon the retirement of the former General Officer and has resulted in significant financial losses for nearly all clergy members with investments in the retirement plan.
After such a significant breach of trust a group of clergy plan participants filed class action lawsuits against their own Church to ensure accountability and redress. The Church understands why the plaintiffs filed those lawsuits and does not resent their efforts to seek a legal remedy for the loss of the plan’s retirement funds. We understand and share their frustration and we harbor no animosity whatsoever towards the plaintiffs.
Settlement Agreement
Despite the emotional and financial strain on both sides, the Church and the Plaintiffs have come together to reach a settlement that provides immediate restoration of some funds and creates a pathway for the Church and Plaintiffs to restore the balance of the lost retirement funds. The Church has committed to seeking full restoration for all plan participants and sees this contingent settlement as a big step toward that result.
Efforts Against Newport and Symetra
The settlement agreement allows for the Church and Plaintiffs to continue pursuing claims against all remaining defendants including Newport and Symetra, the corporate entities on whom the Church relied.
Newport’s and Symetra’s significant culpability has been revealed through evidence obtained from deposition testimony and documents that have been discovered since the lawsuit was filed. These entities, each of which benefited financially, played a critical role in enabling the fraudulent activities that led to the financial losses of innocent ministers and their families.
Statements from Leadership
AME Church’s General Counsel, Douglass P. Selby: “On behalf of the AME Church, we are relieved to have reached today’s settlement which allows us to continue our focus on restoring the retirement benefits of the Church’s valued clergy members.
The agreement reached today demonstrates the Church’s ongoing commitment to its clergy and the determination to hold those truly responsible accountable. The prayer of the Church is that this settlement, and the reforms to which the Church has committed itself, will help to close a painful chapter in the denomination’s history, and begin the path towards healing and recovery of faith and trust among its members and in the systems of the Church.
The Church is committed to a vigorous, sustained pursuit of all avenues of recovery and all lawful claims until its plan participants’ savings are fully restored.”
Plaintiffs’ Co-Lead Counsel, Matthew Lee: “While the decision to sue the Church was difficult, it was necessary to reach this point. This settlement enables the restoration of some of the funds while other culpable defendants continue to hide from their responsibility to make the plan participants whole. We look forward to seeking justice from Newport, Symetra and other Defendants, who played a significant role in this tragic situation.”
Commitment to Transparency and Reform
The AME Church is also introducing major reforms to the operations of the Department of Retirement Services to prevent future mismanagement. These reforms include transitioning to Wespath for future contributions and implementing stricter controls and oversight.
Conclusion
This settlement marks a new chapter for the AME Church and its members. By resolving the Plaintiffs’ claims against the Church, the Church and the Plaintiffs have demonstrated their shared commitment to justice and financial stability. The Church remains dedicated to its mission and to the well-being of its members, and this agreement is a testament to that dedication.
