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FiduciaryNews Trending Topics for ERISA Plan Sponsors: Week Ending 3/16/12

March 19
00:04 2012

1020805_25983300_Trending_Topics_2012.03.19_stock_xchng_royalty_free_300Welcome to Trending Topics. Each Monday, we’ll give you a quick synopsis of the major news events and trends impacting ERISA plan sponsors, 401k fiduciaries and those in the business of supporting these fine folks. If you smile when you read these entertaining snippets, well, that’s the idea. If you think we’re missing something important, then please let us know. But, note this well, we avoid press releases masquerading as news stories (even though they might be reported by journalists) as well as mass media pabulum that merely mouths investment myths and mistakes.

FiduciaryNews Lead Story:
Exclusive Interview with Ary Rosenbaum: The 3 Biggest Compliance Obstacles for 401k Plan Sponsors,” (, March 13, 2012). Here’s a quick overview of the most important facts surrounding key regulatory laws and rules, with some practical legal advice thrown in.

Compliance – The Future is Now:
Shh. Listen. The sound you may hear is the thundering hoofs of the future. And that would be the MEP.
Massachusetts bill will allow a multiple employer 401k plan for nonprofits,” (BenefitsPro, March 14, 2012) This follows on the heels of Congress looking to do the same thing for small businesses.

Fiduciary – A Light at the End of the Tunnel?:
The industry continues its increasingly feeble attack on the fiduciary standard even as it prepares for the eventuality of the fiduciary standard. In the end, will this be much ado about nothing?
What Problem Exactly Is DOL Trying to Solve by Redefining ‘Fiduciary?’” (AdvisorOne, March 13, 2012) Where exactly does the industry get its rhetorical training? Goebbels? We have trouble seeing statistics being used when the source data behind those statistics has not been forwarded to the DOL.
Industry Groups Press DOL for ‘Progress Report’ on Fiduciary Redraft,” (AdvisorOne, March 14, 2012) More complaining from the groups that couldn’t shoot straight. After the DOL revealed their study was without credibility unless the underlying data was released (it never was), the industry group goes on the offensive.
How Technology Helps RIAs and Broker-Dealers Be Better Fiduciaries,” (Financial Planning, March 15, 2012) This goes without saying but we must disagree that RIAs – who currently act as fiduciaries – might need to beef up their software. They’re under the SEC’s gun to justify and account for their fiduciary services now, so if they can’t, that’s an immediate problem.
Wirehouses Minting Fiduciary Advisors – Or Are They?” (Registered Rep, March 16, 2012) In what might be the surest sign yet the industry is ready to capitulate on the Fiduciary Standard, many brokerage firms appear to be quietly training certain brokers as fiduciaries. They’re using third party training organizations (like fi360) and also some internal programs.

Fees – See Me, Hear Me, Feel Me, Touch Me:
Expect a growing and louder chorus of articles about fee disclosure as we approach July 1.
When 401k fees become transparent,” (InvestmentNews, March 11, 2012) Employees will soon learn there is no such thing as a free lunch, assuming they read the fine print.
The Coming 401k Fee Wars,” (LifeHealthPro, March 16, 2012) A reprint of a popular article predicting what we’re starting to see from service providers as a result of the DOL’s Fee Disclosure Rule.

Investments – All’s Quiet on the Western Front:
After a flurry of news articles, the investment tortoise appears to have retreated into his shell.
One in four 401k participants invest solely in TDFs,” (BenefitsPro, March 14, 2012) Well, at least one in four 401k participants on the Vanguard platform, suggesting 25% of 401k participants might be disappointed right now.

Major Plan Sponsor Moves and News:
What are other plan sponsors and fiduciaries doing with their plans? And how are participants responding? The latest in legal proceedings involving plan sponsors and fiduciaries.
Fix Your 401k,” (Wall Street Journal, March 11, 2012)
DC plans in uncertain times: Matching contributions and target-date funds,” (Pensions & Investments, March 12, 2012)
Many Workers Have Savings Below $25K, EBRI Says,” (Financial Advisor, March 13, 2012)
Dreams of comfortable retirement ebb among Americans, says EBRI,” (Pensions & Investments, March 13, 2012)
401k Outsourcing: The Next Big Thing,” (Forbes, March 15, 2012)
The Big Business of 401k Plans,” (, March 15, 2012)
Investors With Dual Retirement Plans Outpace Balances in Pure IRAs, 401k Plans,” (AdvisorOne, March 16, 2012)
Polls: Current Financial Concerns Trump Planning for Retirement,” (Registered Rep, March 16, 2012)

Wisdom from Some of Our Favorite Blogs:
fi360 Blog: Fiduciary Links: We need your input for annual fiduciary survey
401kBasics: Plan Sponsor Quick Tips: Test Results

Miss anything? Feel free to add a comment below.

About Author

Christopher Carosa, CTFA

Christopher Carosa, CTFA


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