Around 5,000 employees and retirees from one of the oldest US churches are closer to recouping millions of dollars in lost retirement funds.
A class action lawsuit was filed in 2022 alleging that leadership and retirement services department of the African Methodist Episcopal Church had breached contractual and fiduciary duties relating to a retirement plan for clergy and lay employees of affiliated churches, colleges, and seminaries.
The suit claimed that the mishandling of funds amounted to almost $90 million that was lost rather than being available to the church employees that were relying on their retirement income. They had been promised that 12% of their wages would be invested in a fund protected by federal pension protections and covered by ERISA.
The AME and plaintiffs are represented by attorneys from AARP Foundation, Milberg, Leiff Cabraser, Kantor & Kantor, LLP, Osborne & Francis, and other firms that have now secured a contingent court settlement, enabling a path to recouping the lost funds.
“Church employees who served their community for years deserve the retirement funds they were promised,” said William Alvarado Rivera, Senior Vice President of Litigation at AARP Foundation. “This agreement is an important step to address the financial harm caused to thousands of people by restoring funds they depend on.”
The settlement states that the church’s elected General Officer and executive director of its Retirement Services department, Dr Jerome Harris, and other defendants stole retirement funds and concealed the diversion of other retirement funds to unauthorized, risky investment vehicles over an extended period of years for their own financial gain.
The AME Church is the oldest and one of the largest U.S. Protestant denominations and historically Black churches, with more than 2.5 million members and 7,000 congregations worldwide.
The settlement is subject to Court approval and litigation continues against the remaining defendants, including Newport Group Inc. and Symetra Life Insurance Co.
"While the decision to sue the Church was difficult, it was necessary to reach this point,” said Matthew Lee, co-counsel lead from Milberg. “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 Group, Inc., Symetra Life Insurance Co., and other Defendants, who played a significant role in this tragic situation."
In May 2022, the AME Church also began legal action against Dr. Harris, in which it stated that he repeatedly gave “a deceptive, false, and grossly inflated value for the Annuity Plan.” The complaint stated, “AMEC learned that only about $37,000,000.00 of Dr. Harris’s previously reported $128,000,000.00 valuation of the Annuity Plan was held by Symetra.”
“This financial crime has been committed against the AME Church community, and specifically our clergy, lay and Church employees,” said Anne Henning Byfield, president of the AMEC Council of Bishops at the time. “With the help of our legal team, the AMEC community is committed to holding those responsible accountable and recovering embezzled funds.”
The lawsuit was never settled as Dr Harris died suddenly earlier this year.
Robert D. Kendall brings decades of experience, including roles at DWS Americas and a former investment unit within Morgan Stanley, as he steps into a global leadership position.
Snowden Lane taps Pontera for held-away retirement account management, while Opto Investments enhances an Indiana-based independent RIA's private markets offering.
The $420 million RIA in Auburn Hills and Ann Arbor gives Credent its second and third Michigan locations while pushing it closer to $4 billion in AUM.
New survey reveals heightened investor concern over market volatility, retirement readiness, and the impact of tariffs on living costs.
Stifel – so far - is on the hook for more than $166 million in damages, legal fees and settlements in investor complaints involving Roberts, a 35-year industry veteran.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
