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Complaint alleges coverup in SAG pension plan embezzlement scheme

Craig E. Simmons, a former employee of the Screen Actors Guild pension and health plans, alleges that he was fired for attempting to uncover an embezzlement scheme involving a previous executive of the funds.

September 16, 2011|By Richard Verrier, Los Angeles Times

A former employee of the Screen Actors Guild pension and health plans has filed a complaint alleging that he was fired for attempting to uncover an embezzlement scheme involving a previous executive of the funds.

Craig E. Simmons, a former human resources executive with the SAG plans, alleges in a complaint filed this week with the Labor Department that he attempted to blow the whistle on a $5-million to $10-million embezzlement scheme by the funds' former chief information officer, Nader Karimi.

But Simmons alleges in his complaint that his former boss, SAG-Producers Pension and Health Plans Chief Executive Bruce Dow, told him to "mislead" the board of trustees and Labor Department investigators about the alleged abuses and that he was fired in March when he refused to do so.

Simmons' complaint also accuses Dow and other current executives of participating in various kickback schemes to benefit themselves or their relatives.

"There are numerous … violations which have not been investigated nor addressed by the board of trustees," Simmons said in the complaint. "Unfortunately, the trustees have apparently chosen not to act on the information provided to them despite strong evidence of violations. As a result, I am now seeking an additional independent investigation into this troubling matter by the [Labor Department]."

A spokeswoman for the Labor Department said that as a matter of policy she could not comment on complaints or pending investigations.

SAG spokeswoman Pam Greenwalt noted that the health and pension funds are multi-employer benefit plans that the union itself does not administer.

The plans, which control about $2.5 billion in assets for SAG members, are overseen by trustees who represent employers and SAG members.

"We are confident that the plans' trustees are taking the appropriate steps to ensure proper oversight and protection of the plans' assets and will continue to safeguard the interests of plan participants," Greenwalt said.

In his complaint, first reported by entertainment industry news website the Wrap, Simmons alleges that he uncovered repeated acts of criminal and civil wrongdoing by current and former employees of the funds. Those included claims that Michael Estrada, the plans' executive director, and Dow, the CEO, used inside information on purchases of stocks and funds for their personal benefit.

Simmons also said in his complaint that the plans conducted business with an insurance company operated by Dow's wife, allowing her to receive "substantial commissions and business advantages," and that the plans employed Dow's brother-in-law in a "phantom" job.

According to his letter to the Labor Department, Simmons said that he made specific complaints in March and August to the SAG-PPHP board of trustees about the alleged improprieties, but that no action was taken.

"Ultimately, it's not about me or the board, it's about the actors who own this fund," Simmons said in an interview.

Dow, Estrada and Karimi were not immediately available for comment. Representatives of SAG-PPHP did not return calls.

richard.verrier@latimes.com

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