Amazon faces class motion over misuse of $350M in 401(okay) funds

Investing.com — Amazon.com (NASDAQ:AMZN) is going through a proposed class motion lawsuit, alleging that the corporate violated federal regulation by misusing almost $350 million in forfeited 401(okay) funds. The go well with claims that Amazon used these funds to offset its personal contributions, relatively than to cut back administrative charges for over 20,000 contributors.

The lawsuit was filed in a Seattle federal court docket on Monday by Amazon worker Cory Curtis. Curtis accuses the net retail big of self-dealing and breaching its duties of loyalty and prudence, as outlined below the federal Worker Retirement Revenue Safety Act of 1974, which governs worker profit plans.

In accordance with the criticism, contributors in Amazon’s 401(okay) plan change into totally vested, which entitles them to matching contributions from the corporate, after three years of service. Between 2018 and 2023, plan contributors who didn’t totally vest forfeited about $349 million in matching funds.

The lawsuit alleges that Amazon didn’t use this cash to cowl the plan’s administrative charges, which totaled greater than $18 million throughout the identical interval. As a substitute, it’s claimed that Amazon used this cash to cut back its personal matching contributions.

The case is recognized as Curtis v. Amazon.com, and it is being heard within the U.S. District Court docket for the Western District of Washington, below case quantity No. 2:24-cv-02164.

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