A few years ago, I had an internship, and had to set up an account with the employer's retirement fund company.
A couple of years after leaving the company, I was closing out old accounts, and realized there was money in the 401k/403b from that job. I didn't think it was vested, but I called the investment company (Company A) to see about closing out the account. They assured me that the money was vested, and I could move it and close the account. I was dubious, and called again, and was told the same thing. So I moved it to my main IRA at investment company B.
Now, a couple of years later, I got a letter from the employer saying the money was contributed in error, and they need it back. They put in a "letter of indemity" requesting the return of funds to investment Company A, who passed it Company B.
Company B informed me that they won't take out the money without my permission, and said they can't return it directly to Company A anyway.
I'm wondering what my options are. It seems to me that the fault here is with either the employer or investment Company A. If it was just a matter of returning the money, I'd be okay -- it's not a life-changing sum (~1.5k). But it also makes a mess of IRS forms and excess contribution fees, accumulated over years.
Can I just refuse to return it? Can I return the money, but insist that Company A or the employer help sort out the IRS forms/fees?