Question

The civil penalty prescribed in Section 502 of ERISA may be in an amount equal to ___ of the recovery obtained by the Department of Labor from anyone found to have breached a fiduciary duty under ERISA or to have knowingly participated in such a breach:

1) 5%
2) 10%
3) 20%
4) 25%

Answer 1

The civil penalty prescribed in Section 502 of ERISA may be in an amount equal to 20% of the recovery obtained by the Department of Labor from anyone found to have breached a fiduciary duty under ERISA or to have knowingly participated in such a breach.

Step-by-step explanation:

The civil penalty prescribed in Section 502 of ERISA may be in an amount equal to 20% of the recovery obtained by the Department of Labor from anyone found to have breached a fiduciary duty under ERISA or to have knowingly participated in such a breach.

For example, if the Department of Labor recovers $100,000 from someone who breached a fiduciary duty, the civil penalty would be $20,000.

This penalty serves as a deterrent to individuals who may consider breaching their fiduciary duties or participating in such breaches under ERISA.