Investment Advisor Restores More Than $341,000 to 68 Benefit Plans
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In This Issue
Compliance and Regulatory Related Investment Advisor Restores More Than $341,000 to 68 Benefit Plans Summary: Iowa-based investment advisor Donald Gene DeWaay Jr. has paid $341,487 to 68 pension plans covered by ERISA. The payments were made as part of a settlement agreement following an investigation by the U.S. Department of Labor's Employee Benefits Security Administration. The investigation found that DeWaay, entities he owns and former employees violated federal law when they recommended certain investments to clients participating in ERISA-covered employee benefit plans between May 2007 and November 2011. EBSA investigators also found that DeWaay's companies and advisors charged higher fees than those agreed to by their clients. Recommendations made to clients also resulted in DeWaay, his companies and former employees receiving commissions from third parties. Source: 401khelpcenter.com Spouse Beneficiary Options for a Qualified Plan Summary: Speaking generally, the surviving spouse of a deceased qualified plan participant may roll the funds into his or her own IRA or to a qualified plan. Here is a detailed overview of the rules with examples. Source: Mhco.com Back to Basics: Record Retention Summary: Less well known, but equally important, is the fact that ERISA also spells out how long a plan sponsor must retain plan documents and records that support those obligations. While it is fairly common for a plan sponsor to contract with outside service providers who may provide certain reports and prepare the plan's Form 5500 filing, the plan administrator is ultimately responsible for retaining adequate records to support the reports and filings. Article details the rules. Source: Kravitzinc.com IRS Windsor Retroactivity Guidance Leaves Questions on ERISA Claims, Practitioners Say Summary: But what about the retroactive application of Windsor to claims for benefits under ERISA? That's a question benefit attorneys say remains open in the wake of the recent guidance from the Treasury Department and Internal Revenue Service on the application to retirement plans of the U.S. Supreme Court's decision in United States v. Windsor. Source: Bna.com Common Retirement Plan Problems and How to Fix Them - Part 1 Summary: If you are responsible for the administration of your company's retirement plan, chances are a mistake will be made during the course of the plan's existence. This article outlines some of the common plan problems and how to fix them. Source: Benefit-Resources.com Helpful Tips to Prepare for a Retirement Plan Audit Summary: Knowing when and how to arrange for an audit of a plan's financial statements is an important responsibility for plan sponsors. While the rules governing audits may appear straightforward, there are important exceptions that can impact filings -- for example, the so-called "80-120 Rule." Source: Leggmason.com Video: Read Those Fee Disclosures Summary: In order for an expense being charged to an employee benefit plan to be reasonable, it must meet certain written fee disclosure requirements in advance of the commencement of the service. In this video, find out if you are receiving all of the significant disclosures from your provider. Source: Erisasunscreen.com Pre-Approved Retirement Plan Restatement Period Opens May 1, 2014 Summary: Those with pre-approved retirement plans and a memory like a steel trap will remember that your retirement plan was rewritten sometime between May 1, 2008, and April 30, 2010. At that time we told you that another restatement would not be required for at least six years. Well, guess what? It has now been six years and it is time to begin a new restatement cycle. Source: Wnj.com
Fiduciary and Plan Governance Material Getting It Right - Know Your Fiduciary Responsibilities Summary: The DOL's "Fiduciary Education Campaign" is designed to improve workers' health and retirement security by educating employers and service providers about their fiduciary responsibilities under ERISA. The Fiduciary Education Campaign includes nationwide educational seminars and webcasts to help plan sponsors understand rules and meet their responsibilities to workers and retirees, thereby improving their financial security. The campaign also includes educational materials on topics such as understanding fees and selecting an auditor. Source: Dol.gov The Equitable Allocation of Revenue Sharing to Participants Summary: Revenue sharing has become a hot issue. That includes the selection of mutual funds that pay revenue sharing, its use for paying plan expenses, and the allocation of revenue sharing to participants. The focus on those issues is largely due to class action lawsuits against large plans and the insistence of the DOL on revenue sharing disclosure. This article discusses the legal issues and alternatives for allocating revenue sharing in participant-directed plans. Source: Napa-Net.org
Insight: Studies, Research and White Papers Defined Contribution Consulting Support and Trends Survey Summary: PIMCO's DC Practice has prepared the 2014 Defined Contribution Consulting Support and Trends Survey to help plan sponsors understand the breadth of views and specific consulting services available within the DC marketplace. This survey captures data, trends and opinions from 49 consulting firms across the U.S., which serve over 7,800 clients. Source: Pimco.com Participant Preferences in Target-Date Funds: An Update Summary: Summary results of survey conducted to determine the preferences of defined contribution plan participants, as opposed to those of sponsors and consultants, on the various investment features of target-date funds. The goal was to support plan sponsors in the target-date fund selection process by helping them align their choice with the preferences and attitudes of their plan populations. Source: Inginvestment.com
Items of Special Interest to Service Providers SEC Reopening Comments on 2010 Proposed Rules Regarding Target-Date Funds Summary: The Securities and Exchange Commission is reopening the period for public comment on rule amendments it proposed in 2010, Investment Company Advertising: Target-Date Retirement Fund Names and Marketing, Securities Act Release No. 9126. In 2013, the Commission's Investor Advisory Committee recommended that the Commission develop a glide path illustration for target-date funds that is based on a standardized measure of fund risk as a replacement for, or supplement to, the proposed asset allocation glide path illustration. The Commission is reopening the comment period to seek public comment on this recommendation. Source: Gpo.gov FINRA's Reminder About Rollovers: News to Many Summary: This article explores FINRA's guidance for broker-dealers and their registered representatives and the potential implications for registered investment advisers. Couched as a "reminder" FINRA's year-end Regulatory Notice 13-45 describes practices that many broker-dealers and their registered representatives will find difficult to implement. Source: Drinkerbiddle.com Summary: The DOL recently issued a proposal to require a 408(b)(2) guide. The guide has also been referred to as a roadmap, but think of it as an index to the disclosures. This is the DOL's response to their review of provider disclosures and problems the DOL has seen. The DOL has at least two more significant concerns. Source: Fredreish.com
Court, Legal, Legislative and Washington DC ING Settles ERISA Class Action Lawsuit Over Revenue Sharing Practices Summary: The parties in Healthcare Strategies v. ING Life Insurance and Annuity Co. filed a motion indicating they have settled their lawsuit and are now seeking approval of the district court. In total, ILIAC agreed to pay over $14mm in damages and agreed to significant changes to its business practices regarding fees and revenue sharing. Source: Fraplantools.com Questions Remain After Decision in Float Income Case Summary: A recent federal appeals court decision favoring Fidelity Investments, Boston, has produced more uncertainty than finality about the use of float income in record keepers' administration of defined contribution plans. Source: Pionline.com
General Items When It's Time to Hire an ERISA Attorney Summary: ERISA attorneys are an excellent resource and there are many reasons why a plan sponsor should hire one. This article will inform you on when it's the best time to call an ERISA attorney. Source: Jdsupra.com Video: Canadian Plan Sponsor Reporting Summary: During Benefits Canada's annual DC Plan Summit, plan sponsors participated in interactive sessions. They split into small groups and were given questions to discuss. Based on these discussions, moderators later offered their insights and relayed key takeaways. This video shares the best ideas from the topics discussed. Source: Benefitscanada.com SSA Letter-Forwarding Program Discontinued Summary: The Social Security Administration (SSA) has announced the end of its letter-forwarding program, a locator service that has been available to the public since 1945. The service will cease on May 19, 2014. Both this program and the curtailed IRS program were mainstays for attempting to locate missing plan participants, an effort required of plan administrators under ERISA's fiduciary duty rules. Source: Ebia.com
Marketplace News Great-West Issues 'Report Card' on Retirement Readiness Schwab Cuts Expense Ratios in Target-Date Collective Trusts Arnerich Massena Rolls Out Fiduciary Education Program CUNA Mutual Unveils Multiple Employer 401k Plan CUNA Mutual Adds Eight Regional Sales Consultants BrightScope Adds Chris Riggio as 'Chief Revenue Officer' SageView Bolsters San Francisco Presence With Hires 401k Plans a Powerful Resource for Retirement Savers MassMutual Retirement Announces New Senior Management
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