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Hosting an industry conference? Ask us about including it in this ticker? Trending Topics for ERISA Plan Sponsors: Week Ending 1/20/17 Trending Topics for ERISA Plan Sponsors: Week Ending 1/20/17
January 23
00:05 2017

Welcome 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. “When everybody’s a fiduciary…  no one is.”

FiduciaryNews Lead Story:
Exclusive Interview with Wade Pfau: Distribution Strategy Just as Important as Savings,” (, January 18, 2017) Oft-quoted professor Pfau also says you can’t turn back fiduciary, Rule or No Rule, and there’s still no easy way to compare reverse mortgage options.

Compliance – More Fallout From a Failed Policy:
Looks like there’s going to finally be an “official” alternative to state-run retirement plans for private employees. And by “official,” we mean policy discussions that bring “the people” back into the equation.
Most small employers oppose state, federal government as auto-IRA sponsors: survey,” (InvestmentNews, January 13, 2017) There are two problems. First, any government run system ends up being a “one-size-fits-all” solution. Second, did you notice the part about “government run”?
We Don’t Have To Be Flat Broke In Retirement,” (Financial Advisor, January 13, 2016) The author makes a convincing case for raising the maximum contribution levels in retirement vehicles.
ICI’s Strong Response to Wall Street Journal 401k Attack,” (The 401(k) Specialist, January 14, 2017) Well deserved comments.

Fiduciary – One Last Breath:
Yogi Berra once said, “It over ‘til it’s over.” We aren’t saying Phyllis Borzi is a Yankees fan, but kept on working right up until she collected her gold watch. Now who knows what will happen.
DOL Quickly Releases Another Batch of Fiduciary FAQs,” (ThinkAdvisor, January 17, 2017) Fred Reish disagrees with one particular item in the DOL’s FAQ: when an RMD related advice becomes fiduciary and when it doesn’t. It might surprise you what direction his opinion takes.
Does ERISA Permit Courts to Order One Fiduciary to Indemnify Another?” (PLANADVISER, January 18, 2017) Could the Supreme Court be poised to make another fiduciary ruling?
Brokerage, insurance firms misleading consumers on fiduciary status: analysis,” (BenefitsPRO, January 18, 2017) But you already knew that.

Fees – Does a Crime Occur if You First Disclose Your Intention?:
So here’s an idea. Let’s say you’re a bank robber. You go up to a teller and hand them a note. It says, “This is a robbery. Give me all your money. Nod your head silently if you understand.” The teller complies but slips in one of those colorful smoke bombs. It goes off in your get-away car. You put the foot on the brakes, blinded and dripping with blue goo. The cop comes up to you and cuffs you. After you spit out a bunch of that goo from your mouth, you calmly say, “I disclosed what I was doing and the teller acknowledged that disclosure.” “Oh,” says the officer as he uncuffs you, “sorry about that. You’re free to go.”
Morgan Stanley, Citigroup, Hit for Fee Overcharges,” (Financial Advisor, January 13, 2017) Oops! Seems like they forgot to apply those discounts that they sold. To the tune of $22.5 million (for Citigroup). That’s a lotta tea. But it does show you that a fiduciary breach can occur without conflict-of-interest fees. It can also occur by simply not charging the fee you say you’re going to charge. Hmm, makes one wonder if any plan sponsors were on the hook for failing to notice these overcharges…
Second round of DOL fiduciary rule FAQs clears confusion on common compensation practice for 401k advisers,” (InvestmentNews, January 18, 2017) Yep, it’s clear now. You can still engage in self-dealing conflict-of-interest transactions. You just have to ask permission first.

Investments – Market Takes a Break for Inauguration Week:

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.
Primary 401k Focus for Employers in 2017 is …,” (The 401(k) Specialist, January 17, 2017)
Reason No. 1,758 for Employers to Offer a 401k,” (The 401(k) Specialist, January 10, 2017)
Prudential Lawsuit a Lesson in 401k Fiduciary Services,” (The 401(k) Specialist, January 11, 2017)
Firm Accused of Failing to Forward Employee Retirement Plan Contributions,” (PLANADVISER, January 13, 2017)
DOL FAQ Delves Into Investor Rights Regarding Advice,” (PLANADVISER, January 13, 2017)
How to leverage technology to simplify retirement administration,” (Employee Benefit News, January 16, 2017)
Top 5 ERISA settlements in 2016,” (BenefitsPRO, January 19, 2017)

Trends and Truths for Retirement Savers:
If you’re a retirement plan fiduciary – whether a plan sponsor or a financial professional, don’t you think it’s a good idea to keep up on the topics retirement savers are most interested in? That’s what the media tries to do. Here’s what they think is on the mind of the people saving for retirement.
Living longer is the greatest retirement risk for women,” (NY Daily News, January 16, 2017)
401k Changes That Help You Retire Richer,” (Money, January 17, 2017)
5 practical steps for creating a retirement backup plan,” (CBS News, January 17, 2017)
After Retirement, Finding a ‘Second Career’ as a Volunteer,” (The New York Times, January 17, 2017)
More IRA Owners Contributing the Maximum,” (PLANADVISER, January 17, 2017)
What Should I Do With a $1 Million Inheritance?” (Money, January 17, 2017)
Retirement in the Gig Economy,” (Wealth Management, January 17, 2017)
What Baby Boomers Need To Know About Required Minimum Distributions,” (Forbes, January 18, 2017)
Retirement savers can’t forget it’s all about retirement spending,” (BenefitsPRO, January 18, 2017)
Retirement Clients Concerned Over Federal Tax Policies,” (PLANADVISER, January 18, 2017)
Want to live longer in retirement?” (BenefitsPRO, January 18, 2017)
A health savings account could power your retirement,” (MarketWatch, January 20, 2017)

Wisdom from Some of Our Favorite Blogs:
Data “Points”: “Things,” Remembered |
Pension Risk Matters: How to Sell Investment Services |
Scholarly Financial Planner: DOL Fiduciary Class Action Lawsuit Risks & Duty Of Care |
The Rosenbaum Law Firm P.C. Blog: Yes, a Fiduciary was held personally liable |
The Rosenbaum Law Firm P.C. Blog: The Next Big Thing After The Fiduciary Rule? I have some guesses |
Nerd’s Eye View: Julie Littlechild of Absolute Engagement On Being Referable |
Business of Benefits: Correcting the “best guesses” on 403(b) Plan terms by using the first 403(b) Remedial Amendment Period under Rev Proc 2017-18 |
Nerd’s Eye View: Social Security Full Retirement Age Increases Past 66 |
ERISA Lawyer Blog: First Circuit Upholds Plan Administrator’s Determination Of Participant’s Years of Benefit Service For Purposes Of Calculating His Pension Benefit |
Boston ERISA Law Blog: The Church Plan Cases at the Supreme Court: A Billion Here, A Billion There and Soon You Are Talking Real Money |
Boston ERISA Law Blog: Are Forum Selection Clauses Valid Under ERISA? |
Scholarly Financial Planner: Thank You to a Small Team That Accomplished Great Things (DOL Fiduciary Rule) |
The Rosenbaum Law Firm P.C. Blog: Automatic enrollment is growing in 401k plans |
The Rosenbaum Law Firm P.C. Blog: The big winner for the Fiduciary Rule |
ERISA Lawyer Blog: DOL Issues Another Set of FAQs On Conflict Of Interest Rules |
Squared Away Blog: People Lack Emergency Funds, Tap 401ks |
Behavior Gap: Money Does Not Equal Happiness |
The Rosenbaum Law Firm P.C. Blog: Don’t blame the 401k |
Fred Reish: Interesting Angles on the DOL’s Fiduciary Rule #34 |
Proskauer: U.S. Supreme Court Seeks Solicitor General’s Input on Co-fiduciary Indemnification |

Hot Tips from Popular Web Resources: Managing A Health Savings Account With An IRA To Maximize Benefits |
The Motley Fool: 79% of Americans Favor Social Security Benefit Cuts, New Survey Shows |
NAPA Net: 2nd Set of COI FAQs Tackles Technical Issues |
NAPA Net: The ‘Free’ Retirement Money Many Overlook |
NAPA Net: DOL Publishes FAQs on Fiduciary Rule, But… |
Kiplinger: When to Take Social Security Early |
Morningstar: Retirement Planning for Special-Needs Families |
NAPA Net: Tax Reform Blueprint Spells Disaster for Small Biz Retirements |
NAPA Net: What Do TDF Trends Tell us About Transfer Trading in 2016? |
NAPA Net: Puzder Nomination Hearing Set for Feb. 2 |
The Motley Fool: The Social Security Death Benefits You Need to Know About |
Kiplinger: Qualifying for the Retirement Savers’ Tax Credit |
NAPA Net: Proprietary Fund Suit Proceeds |
NAPA Net: SEC Settles With 10 Advisory Firms on Pension Pay-to-Play Charges |
NAPA Net: Updated Proposed Rules for Oregon Retirement Savings Plan Filed |
NAPA Net: Why Don’t (More) Small Businesses Offer Retirement Plans? |
NAPA Net: Warren Asks Financial Services Firms Where They Stand on Fiduciary Rule |
NAPA Net: Proposed Reg Would Free Up Forfeitures to Fund Safe Harbor Contributions |
NAPA Net: A Seminar Can Be a Fiduciary Act, or There’s No Such Thing as a ‘Free’ Dinner Seminar |

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Christopher Carosa, CTFA

Christopher Carosa, CTFA

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