Where’s the best place for the 401k plan sponsor to go for free help on their fiduciary duties and responsibilities?
Posts From Christopher Carosa, CTFA
If the DOL requires the 401k plan fiduciary to ignore a fund’s investment performance, but the SEC still requires funds to disclose that performance, which will 401k investors choose? More importantly, who’s left holding the liability bag?
While the passage of Health Care Reform muted the market’s momentum in late March, the Goldman Sachs hearings proved the turning point. The folks on Main Street just lost 10% of their retirement savings in less than a month. You can’t blame Wall Street for that.
Will Congress, the SEC and the DOL upgrade the current fiduciary standard to the trust model used by bank trust departments so successfully for more than a century?
Has index investing become the soma of savers? Does it place employees – and the markets – in harm’s way? By extension, has the 401k fiduciary now assumed a greater liability?
Should indirect fees matter? Academics may argue, but regulators will have the final say. Unfortunately, different definitions of fees only confound the ERISA fiduciary.
Too many accept the definition of “fees” without deliberation. Yet, even by looking solely at the fees associated with investment choice, the fiduciary can land in a state of confusion. This only increases liability. How can we fix this?
Under the DOL’s proposed Investment Advice Rule, if a plan enters into a prohibited relationship with a vendor – or if an existing relationship now becomes prohibited – fiduciary liability rises. Can the 401k fiduciary afford to ignore these critical issues?
Are you breathing a sigh of relief? Commentators seem to have coalesced around several key benefits of this proposed Rule. Can you see these helping your plan’s participants?
Most interesting, though, may loom the warning of Justice Alito: When is comes to fiduciary duty, disclosure isn’t enough. One wonders if the DOL is listening.
