Fiduciary News interviews an industry spokesman, who, on the condition of anonymity, shares a shocking point in the SEC 12b-1 proposal that has, to date, failed to receive the media coverage one might expect.
Tag "SEC"
The Official press release provided by the SEC asking for public comment.
For 401k plan sponsors and fiduciaries, this seismic events delivered out of the nation’s Capital on July 15 signals the start of significant changes in the way they operate their plans.
Why some target date investors should be furious, why expecting 401k plan sponsors to comment on a change they don’t understand would be asking far too much and just see what he says about 12b-1 fees.
The adoption of a universal fiduciary standard may greatly impact how their plans operate. You might be surprised to hear what industry insiders are saying about it.
These three issues linger like a ticking time bomb. They’re out there. They’re going to go off at some point. We just don’t know when. Plan fiduciaries need to get ready for them.
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?
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?
As usual, be careful about elixirs marketed as cure-alls. Personally involved in creating CITs in the early 1990s specifically to market to 401k plans, I’ll share my experiences with you here.
Why wait until now to bring up the three-month old blog? The bigger question, however, remains, “How should a 401k fiduciary analyze mutual fund fees?”
