Principal Financial The Principal 401K Held Hostage by Principal Financial, Internet

The money in my 401K from a previous company has been held hostage by Principal Financial for over 10 months now. My previous employer filed Ch. 11 bankruptcy and laid-off the last of its employees on Sept. 1, 2009. In January of 2010 I filed the paperwork with Principal Financial to get the money from my 401K at the time valued in excess of $15,000.00. I filed all the forms required by Principal and even had them signed by the former CEO of the company I worked for. Principal told me everything was in order and my payment less tax and IRS penalty was in process and would be sent to me within 4-6 weeks. This money was important to me because my savings was exhausted and finding a new job in this economy was still not going to happen for me for another 6 mos.

Now the run around from Principal began. Principal said that my money was accounted for and actually in my account. However, the plan was in termination and this could take a few months. Well a few months has stretched into nearly a year as Principal said the 401K plan was now in abandonment and this was going to take longer. The money I was going to use for my mortgage and medical bills was held up. I could no longer pay my mortgage since my savings was gone and Principal wouldn't release my money to me. That left me facing foreclosure and unpaid medical bills.

Fed up with Principal I called the IRS and reported Principal Financial Group. They told me this was not under their purvue and I needed to call The Labor Department. I called The Labor Department and actually got a call back from the person investigating why Principal Financial wouldn't release my money. They verified the plan was abandoned by my previous employer and there wasn't much they could do to help me "it has to run it's course." I sent more correspondence to Principal and they told me my former employer wouldn't cooperate with the IRS or The Labor Department. Unbelievable as if I have some sort of control over a former employer that laid me off where I was no more than an at will employee. How the actions of a former employer affect my ability to get my money from my 401K in a hardship is beyond me.

The bottom line is this DON'T TRUST PRINCIPAL FINANCIAL GROUP! They will find a way to screw you. Just like any bank will if given the chance. Only Principal will flat out lie and rip you off. They are cheats and thieves and won't give you your money even if you file all of the necessary paperwork.

If I knew what laws they are breaking I would haul them straight to court for fraud!