(KMOV.com) – A recent report says Hostess used money intended to fund employee pensions for other purposes.
The Wall Street Journal is reporting the company told employees it would stop making contributions to pensions in August, 2011. However, management used the money intended for pensions to keep the company afloat instead. Now, the money is gone.
According to the Wall Street Journal the action is not illegal. The most recent CEO of Hostess calls the situation “terrible.” He says the decision to use the pension funds for something else was made before he was in charge.
Hostess employed more than 350 people in St. Louis.