I received a letter from a woman claiming to be the legal wife of a deceased participant. She says a 1978 divorce was fraudulent and the subsequent remarriage was invalid.
This participant retired in 1982 and died in 1987. The DC plan paid monthly benefits to the participant and later to the second wife(?) until the account was exhausted in 1991. Can the plan defend itself as an innocent victim if the marital changes were fraudulent? Could we be liable for half of the payments to the participant and all of the payment to the second wife?
I know this is more like the reverse of a QDRO, but I am hoping one of you has experience with something similar.
Full Version: Invalid Divorce
QUOTE (beppie_stark @ May 18 2006, 01:27 PM) 
I received a letter from a woman claiming to be the legal wife of a deceased participant. She says a 1978 divorce was fraudulent and the subsequent remarriage was invalid.
This participant retired in 1982 and died in 1987. The DC plan paid monthly benefits to the participant and later to the second wife(?) until the account was exhausted in 1991. Can the plan defend itself as an innocent victim if the marital changes were fraudulent? Could we be liable for half of the payments to the participant and all of the payment to the second wife?
I know this is more like the reverse of a QDRO, but I am hoping one of you has experience with something similar.
This participant retired in 1982 and died in 1987. The DC plan paid monthly benefits to the participant and later to the second wife(?) until the account was exhausted in 1991. Can the plan defend itself as an innocent victim if the marital changes were fraudulent? Could we be liable for half of the payments to the participant and all of the payment to the second wife?
I know this is more like the reverse of a QDRO, but I am hoping one of you has experience with something similar.
I couldn't imagine what this would have to do with the Qualified Plan. If anything, her issue would be with the decedant's estate. She would have to prove that the Plan Administrator had actually breached it's fiduciary duty. This will be hard to prove since most statement or forms received by the Plan Administrator are notarized or witnessed by the plan administrator. Her burden of proof would have to be that the Plan Administrator either failed to follow procedured designed to enforce her rights or failed to establish procedures designed to enforce her rights.
There is no basis for this claim because
1. the plan is holding 0 assets for the participant at this time.
2. the applicable statute of limitations to filing a claim for benefits expired long ago (its been 15 yrs since the last amount was paid out by the plan).
3. Plan had no notice of her claim prior to paying benefits and is not responsible for her failure to come forth.
4. There is no requirement that plan honor divorce agreements which provide for payment of retirement benefit to ex spouse that were entered into prior to 1985.
1. the plan is holding 0 assets for the participant at this time.
2. the applicable statute of limitations to filing a claim for benefits expired long ago (its been 15 yrs since the last amount was paid out by the plan).
3. Plan had no notice of her claim prior to paying benefits and is not responsible for her failure to come forth.
4. There is no requirement that plan honor divorce agreements which provide for payment of retirement benefit to ex spouse that were entered into prior to 1985.
I agree with mjb, but they she may do some saber rattling.
What is a fraudulent divorce?
You may need to formally respond detailing why her claim is denied.
What is a fraudulent divorce?
You may need to formally respond detailing why her claim is denied.
Assuming they respond to her claim, shouldn't the plan administrator require the woman to provide legal documents proving she's the wife? Wouldn't the plan administrator be breaching privacy laws if they arbitrarily released information to this person.
BTW, I agree with the prior posts that the plan has no liability in this situation.
BTW, I agree with the prior posts that the plan has no liability in this situation.
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