Can a company 401K plan borrow their own contribut

L1: Can a company 401K plan borrow their own contributJust curious with the default the UALpension. I realize that each employee shows his account monies in 401K plan and that the employer has 15 days to deposit the moniesinto theplan.
My question is can the employer of the 401K planat later date dip into the company match contributions and have the monies to use with anIOU at a certain interest?? If so are those borrowed monies insured against default?? TIA2005-05-15 12:37, By: Jack, IP: [68.251.201.76]

L2: Can a company 401K plan borrow their own contributHello Jack:
Actually, the situation of the company (plan sponsor) borrowing back from the “retirement plan trust” has happened numerous times; ususally with bad results for plan participants. If you think about it; simply offering company stock in a retirement plan does just that; however, I think you are referring to more aggregious transactions such as the trust offering a pooled investment & then within the pool (kinda like a private mutual fund), the pool loans cash back to the employer secured by a loan; employer goes belly up & defaults the loan — yes sir; it’s happened numerous times essentially turning a plan participant into an unsecured creditor of the corporation without their knowledge.
There are howeversure fire ways to avoid this situation:
1. Only invest within a retirement plan into publicly traded securities; e.g. stocks, bonds, mutual funds.
2. If you are tempted to invest in “private” securities, very,very carefully read the 5500; this is the tax return that the retirement plan trust must file; must give to you; and discloses ALL.
TheBadger
wjstecker@wispertel.net
2005-05-15 20:15, By: TheBadger, IP: [66.250.23.21]