Also named in the lawsuit are Joel Danziger and Harris Markhoff of Beacon and Andover, Lawrence Simon and Howard Wohl of Ivy, and John Jeanneret and Paul Perry of J.P. Jeanneret.  The defendants provided advice and investment services to the plans.

The suit, filed in the US District Court for the Southern District of New York, alleges that the defendants violated the Employee Retirement Income Security Act by recommending, making and maintaining investments with Madoff, resulting in the loss of hundreds of millions of dollars of Erisa-covered plan assets. 

The suit also alleges that the defendants failed to take prudent actions to investigate or monitor Madoff and his purported trading and to disclose the extent of the known risks, irregularities and suspected "red flags" surrounding Madoff's operation. 

Additionally, the suit alleges that the defendants failed to protect the plans' interests while collecting tens of millions of dollars in fees for themselves as a result of the Madoff investments.

According to the suit, plan investments were made with Madoff through direct investment and indirectly through the Jeanneret, Beacon and Andover funds that invested with Madoff. 

The suit further alleges that the Jeanneret defendants improperly received higher fees on the Madoff investments than other investments.

As relief, the suit seeks to require the defendants to restore all losses suffered by the plans and to return any fees and profits improperly received as a result of plan investments with Madoff. It also seeks to permanently bar them from serving in a fiduciary capacity to any plan governed by Erisa in the future.

"These defendants chose their own financial interests over those of the plans whose assets they were duty bound to manage prudently. Their actions put the future benefits of thousands of workers in jeopardy," says Secretary of Labor Hilda L. Solis.