Hostess Workers' Pension Money Diverted For Other Uses: Report

http://www.huffingtonpost.com/2012/12/10/hostess-pensions-diverted_n_2271868.html?1355172901&ncid=edlinkusaolp00000009

by Bonnie Kavoussi, huffingtonpost.com
December 11th 2012

Hostess Brands acknowledged for the first time in a news report Monday that the company diverted workers' pension money for other company uses.

The bankrupt baker told The Wall Street Journal that money taken out of workers' paychecks, intended for their retirement funds, was used for company operations instead. Hostess, which was under different management at the time the diversions began in August 2011, said it does not know how much money it took.

"It's not a good situation to have," Hostess CEO Gregory Rayburn told the WSJ.

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In November, a judge approved Hostess' plan to pay $1.8 million in bonuses to 19 executives, according to CNBC. Rayburn declined to take a bonus but also avoided a company-wide pay cut that he imposed, Hostess told HuffPost.

Twinkies are unlikely to go extinct, since Hostess is in talks with 110 buyers about its brands. But the snack cake genre may need a revamp, as Americans have become increasingly health- and quality-conscious.