SWITZERLAND - The pension fund for RSE, a small medical firm in Emmental, has been hit by a CHF700,000 (€430,000) funding loss caused by the actions of a former director.
The scheme in question insures 600 employees at RSE, a provider of medical services, including two clinics, near the city of Bern. It is demanding that RSE provide the funds needed to close the gap.
According to the fund, the deficit resulted after former RSE director, Max Rickenbacher reduced employees' contributions to the scheme in 2004 and 2005. "Although we demanded in November 2003 that the reductions not be made, management did not respond to this demand," the scheme said.
The scheme also said that after disregarding its demand, Rickenbacher did not set aside enough reserves to cover the reductions in the employee contributions.
RSE's supervisory board fired Rickenbacher late last autumn. He was replaced by Bruno Zürcher. Contacted by IPE, Zürcher was not immediately available for comment.
Since Rickenbacher's dismissal, RSE's supervisory board has told the local press that despite the CHF700,000 gap, pension benefits were not endangered owing to the fact that the scheme was more than fully funded
Susanne Hofer Nydegger, head of the supervisory board, was also not immediately available for further comment, including whether RSE has since plugged the hole.
Meanwhile, the local newspaper quoted Rickenbacher's attorney as saying that in his client's view, the lower employee contributions were justified owing to the scheme's excellent funding ratio.
Separately, a judge investigating the past financial woes of a civil servants' pension fund told Le Temps newspaper that he has found evidence of a possible cover-up of those troubles.
The judge neither elaborated on who might be behind the cover-up nor did he indicate whether he would prosecute.
The scheme in question is a public one and insures civil servants in the city of Fribourg. In 2003, its funding ratio relative to liabilities fell to 31% - one of the lowest figures ever for a Swiss pension fund.
By January 2006, the city of Fribourg was forced to provide a €19m cash injection to bail out the scheme. A month later, a special commission unveiled a report placing part of the blame for the scheme's chronic underfunding on its former trustee.
However, Dominique de Buman, the scheme's trustee between 1991 and 2004, has firmly denied that he was responsible for its troubles.