Date: October 5, 2024 (Original Submission)
Tracking Number: 20241005-0002
Subject: Allegations of Financial Misrepresentation by Principal Life Insurance Company (2008-2013)
Submitted By: Dennis R. Myhre, AIC
Affected Parties: 401(k) Plan Investors in Principal U.S. Property Separate Account (PUSPSA)
1. Introduction
Under federal fiduciary laws, financial institutions managing retirement accounts are obligated to act in the best interests of their clients and adhere to ethical and legal standards. Misuse of investor funds for non-financial objectives or excessive expenditures unrelated to sound investment strategy may constitute fiduciary misconduct, exposing responsible parties to legal liabilities, including financial penalties and litigation.
Relevant legal references:
Employee Retirement Income Security Act (ERISA) of 1974 (29 U.S.C. § 1104) – Establishes fiduciary responsibilities for retirement plan administrators, requiring prudence, loyalty, and adherence to plan documents.
Securities Exchange Act of 1934 (15 U.S.C. § 78j) – Governs fraudulent investment practices, including misrepresentation and securities fraud.
Investment Advisers Act of 1940 (15 U.S.C. § 80b-6) – Prohibits fraudulent investment advisory practices and conflicts of interest.
2. Summary of Allegations
This complaint details financial transactions executed by Principal Life Insurance Company, specifically through the Principal U.S. Property Separate Account (PUSPSA), that resulted in material financial losses for investors. Evidence suggests misrepresentation of financial assets, mismanagement of funds, and possible violations of fiduciary obligations.
Key concerns include:
- The purchase and management of 170 King Street (aka 170 Off Third) in San Francisco, acquired by Principal for the PUSPSA in 2003.
- Questionable capital expenditures related to building renovations, including privately commissioned artwork of significant cost.
- The role of former CEO Larry Zimpleman and Property Manager Mark Hanrahan in overseeing transactions that may not have aligned with investor interests.
- Potential breaches of fiduciary responsibility concerning the use of investor funds.
3. Request for Investigation
Given the financial implications for retirement investors and potential violations of fiduciary duty under federal law, I respectfully request a formal investigation by the appropriate regulatory and legal authorities. Relevant documentation, transaction records, and other supporting materials are available upon request.
