1Point Solutions hands out pink slips

UPDATED 11:30 with copy of e-mail from Stokes closing business -- A former employee said founder Barry Stokes had reassured employees early in the week then delivered the news yesterday morning

Email | Print By Richard Lawson

[UPDATE, 11:30 a.m.:]

Another former employee of 1Point solutions has furnished to NashvillePost.com the e-mail that Barry Stokes sent to employees yesterday announcing the shutdown of the business:

From: Barry Stokes
Sent: Thu 9/21/2006 7:24 AM
Subject: Close of Business

Yesterday, MBI shut down the cards. This has forced the closure of 1Point.

The attorneys have negotiated the opening of the bank accounts. All employees will be paid through the end of the month and health insurance will be paid through October. At that time you will be COBRA eligible.

Please pack you personal belongings. I am in Dickson today shutting it down. I will then communicate with all CP and PS. Please don't speak to them as it needs to be a message from me. It is also helpful if you do not speak to the media.

Thank you,

Barry

[As originally posted:]

Yesterday was a dark day for employees of troubled employee benefits advisor 1Point Solutions.

Founder Barry Stokes handed out pink slips yesterday morning to the company's employees, a former employee said. That came in the wake of lawsuits against 1Point claiming it misappropriated 401K funds. The former employee guessed that the company had between 90 and 100 employees, mostly at the Dickson headquarters. It also had an office in Bellevue.

Stokes apparently tried to blame the closure on a financial processing partner's decision to lock 1Point out of its system. MBI, owned by Calabasas, Calif.-based Metavante Corp., is an employee benefits software company the offers a benefits debit card employees use for drawing money out of flexible spending accounts. The former employee said the reason for shutting the company down likely had nothing to do with MBI.

Also yesterday, Metro Human Resources Director Dorothy Berry said the city was terminating its contract with 1Point. Berry had noted that the city couldn't get technical data delivered electronically from 1Point because of the MBI action.

Stokes had painted a rosy picture Tuesday afternoon and told employees that their jobs weren't in jeopardy and that no one could freeze the company's assets, including the federal government, the former employee said. The former employee said Wednesday morning Stokes was holding to that line, opening a meeting with Mark Twain's famous quip: "The rumors of my death are greatly exaggerated."

The former employee said fellow employees didn't buy it Tuesday afternoon or yesterday morning, saying that Stokes and other management seemed cocky. "Personally, we all knew it was a crock of crap," the now-unemployed staffer said.

Meanwhile, yet another lawsuit against Stokes and 1Point was filed yesterday in Nashville's federal court. Somewhat surprisingly, the plaintiff this time is itself a money manager well-known in Nashville: Mastrapasqua Asset Management Inc. The firm and its principals, the father-and-son team of Frank and Mauro Mastrapasqua, assert that nearly $800,000 in employees' 401(k) money has gone missing.

The lawsuit, a copy of which is available at this link, expresses the fear that funds from the savings plan have been "misappropriated and mishandled." Anne C. Martin of Bone McAllester & Norton PLLC represents the Mastrapasqua company and its principals.