Businessman Fined, Barred for Use of Retirement Funds

A businessman accused of mishandling funds from his company’s profit-sharing plan has agreed to repay $220,000 to the plan and to be barred for life from having financial responsibility over federally regulated retirement accounts, the U.S. Labor Department said Wednesday.

A lawsuit against Michael L. Thibodeau, owner of Sherwood Shutter Corp. in Santa Ana, and an agreement to settle it were filed together Feb. 19 in federal court in Santa Ana.

The Labor Department said Sherwood ran into financial trouble beginning in 1989 and couldn’t obtain bank financing. Thibodeau transferred $300,000 from the profit-sharing plan to the company in 1991, repaid $89,000 that year and issued a note for the balance, the agency said. It said he made only two interest payments by 1995, when Sherwood filed to reorganize under bankruptcy law.

Thibodeau was accused of failing to collect money his company owed to the plan in a timely manner and of failing to set up the loan properly. He couldn’t be reached for comment.

Thibodeau is required to repay the money within two years and won’t be allowed access to his own pension benefits until the money has been repaid.