FiduciaryNews

Posts From Christopher Carosa, CTFA

5 Rules for the Fiduciary Seeking to Avoid the Next Madoff

We don’t need more regulation to prevent future Madoffs, we just need common sense (and, perhaps, a tad bit more enforcement of existing regulations). Here are five straightforward rules fiduciaries can follow to avoid their own personal investment Waterloo.

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ICI Memo Reveals What the Industry Wants the ERISA/401k Fiduciary to Disclose

One of the biggest liability risks facing the ERISA/401k plan fiduciary derive from the inability to properly disclose and educate plan participants. The primary reason for this gap may be due to lack of specifics from the DOL regarding plan document contents and distribution of key information to participants. The suggestions offered by the ICI should help remedy this gap.

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Am I an ERISA/401k Fiduciary?

You may be an ERISA/401k fiduciary and not know it. The first step to reducing your personal fiduciary liability it to fully understand under what conditions you may be acting as a fiduciary.

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401k Fiduciary Warning: 3 Reasons Why Annuities May Increase Your Liability

The Arizona Republic, reporting on the Profit Sharing/401k Council of America conference in Scottsdale last week, wrote “many experts see rising use of annuities as the next innovation” in 401k plans. Who were these “experts?” Annuity salesmen?

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5 Things the Fiduciary Might Not Know About the 401k Plan Investment Policy Statement

Does creating an Investment Policy Statement (IPS) reduce fiduciary liability or augment it? Though there’s no clear agreement on this matter, the DOL has long maintained it has greater concern for processes than outcomes. Benefits attorneys often view memorializing the process through an IPS and documenting its successful implementation as the surest way to reduce fiduciary liability.

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For the 401k Fiduciary Looking to Reduce Fiduciary Liability: Who Is and Who Isn’t a Registered Investment Adviser?

The 401k fiduciary typically searches for ways to reduce fiduciary liability. This can be done by hiring what the United States Department of Labor (DOL) terms “prudent experts,” particularly in the area of investments. The DOL permits a fiduciary to appoint, among others, a registered investment adviser to reduce personal fiduciary liability.

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Everything an ERISA/401k Fiduciary Needs to Know About DOL Audits to Reduce Fiduciary Liability

What most often triggers a DOL audit? What liability exposure does the ERISA/401k fiduciary typically face as a result of a DOL audit? Can a retirement plan fiduciary face criminal charges? What does the DOL auditor expect from the ERISA/401k fiduciary? What are the four critical keys the plan fiduciary should focus on during a DOL audit? Does the DOL have an ideal “Wish List of Materials” they expect an ERISA/401k fiduciary to provide them during a DOL audit?

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5 Critical Components of a Plan Diagnostic Test

Conducting a periodic plan diagnostic test is often seen as an easy way for the typical 401k fiduciary to reduce fiduciary liability. An ERISA plan trustee or fiduciary will usually hire an independent fiduciary consultant to conduct a comprehensive plan fiduciary diagnostic test. Here are five critical areas to consider.

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Never Buy a Bond Mutual Fund Thinking it’s a Bond

Don’t ever buy a bond fund thinking you are diversifying into fixed-income assets. A bond fund more closely approximates an income-oriented equity fund than it does a fixed-income asset.

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Is Supreme Court About to Mislead 401k Investors & Fiduciaries?

The Supreme Court will raise the visibility of the fee structure within the investments of nearly half of all 401k plan assets. Just because the powers that be say it’s so, doesn’t necessary mean your average fiduciary can rely on the decree. Indeed, the Supreme Court of the United States appears poised rule in favor of mutual fund shareholders, yet, at the same time, mislead both 401k investors and fiduciaries.

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