Navigating the Minefield of Fiduciary Liability
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In This Issue
Fiduciary and Plan Governance Material
Navigating the Minefield of Fiduciary Liability Summary: The failure to fully execute the fiduciary duties ERISA imposes upon 401k plan employers and administrators can lead to significant liability exposure. In this article, attorney Robert Port helps plan sponsors navigate the minefield of fiduciary liability including reviewing the litigation risk and suggesting some best practices. As the author suggests, "This is no place for amateurs."
Source: 401khelpcenter.com
Four Essential Skills for Retirement Plan Fiduciaries Summary: This article will de-bunk the currents myths about fiduciary duty, delve into the four critical disciplines that plan sponsors need to know, and discuss best practice tips for excelling in each area as a retirement plan sponsor.
Source: Rolandcriss.com
Mistakes That 401k Plan Sponsors Should Avoid, But Do Anyway Summary: This Ary Rosenbaum article is about common mistakes that plan sponsors commit in their role as plan fiduciaries, errors that increase their liability, but they still do it anyway.
Source: Jdsupra.com
Process for Terminating Investment Managers Is Important Summary: While much time is spent selecting investment managers, not nearly enough time is spent in establishing a processing for terminating such managers, says a recent paper from the Strategic Investment Group.
Source: Planadviser.com
The "Gotchas" of Retirement Services Purchasing Summary: The information gap that has existed between retirement services vendors and retirement plan sponsors has created fertile ground for "gotchas" in vendor service arrangements that continue to waste millions of dollars of retirement plan savings annually. This article explores the most common gotchas plan sponsors face and offers real-world solutions for those organizations seeking to improve their fiduciary supply chain management approach.
Source: Rolandcriss.com
403(b) Plans
Fiduciary Responsibility for Investments a Serious Matter Summary: Whether they are sensitive to their role as a fiduciary or not, 403(b) plan sponsors are required to take their responsibility seriously and to put their plan participants' interests first when considering the management of assets in retirement plans. Article offers a few things to watch for.
Source: Plansponsor.com
Insight: Studies, Research and White Papers
Benefits Strategy and Benchmarking Survey Data Released Summary: Benefits Strategy & Benchmarking Survey reveals that employers continue to see rising benefit costs in 2014. The survey examines how organizations are responding to healthcare reform and rising costs, as well as their approach to private exchanges, wellness and retirement programs, and other benefit trends and opportunities.
Source: Todaysfacilitymanager.com
Unconventional Wisdom on Retirement Preparedness Summary: How well are Americans planning and saving for retirement? This is an important question to answer, but also vexingly difficult. Researchers have come to different conclusions. Much of the academic research and ICI's own analysis of the data indicate that, contrary to conventional wisdom, most Americans are properly preparing for retirement.
Source: Ici.org
Smaller 401k's Outperform Bigger Plans Summary: Bigger isn't always better when it comes to 401k plan performance. In fact, it's the smallest plans that are setting the pace, according to an analysis by Judy Diamond Associates, publisher of retirement plan data.
Source: Benefitspro.com
Items of Special Interest to Service Providers
Solving Technology Challenges With IT Outsourcing for Retirement Administrators Summary: IT outsourcing can provide them with the opportunity to take advantage of advanced, modern recordkeeping applications within a high-performance IT infrastructure while outsourcing the implementation and maintenance of these systems. At the same time, providers can leverage global data centers to host their software and IT systems in a secure, compliant, and accessible environment while controlling everyday recordkeeping operations. Some of the benefits of IT outsourcing are reviewed here.
Source: 401khelpcenter.com
Plan Automation
Pushing the Employee-Savings Envelope With Auto-Escalation Summary: While the concept of automatically escalating 401k paycheck deductions annually may sound unappetizing to some HR leaders because of the added costs they can incur, the results of a recent survey indicate employees may be ready to dig in.
Source: Hreonline.com
Issue of Lifetime Income
Guidance on Offering Longevity Annuities in DC Plans Summary: On July 2, 2014, the IRS published final rules intended to make it easier for DC plans to offer lifetime income payment options to participants by removing the technical barrier to one of those options: longevity annuities. After summarizing the guidance, this article lists some preliminary observations as well as issues that interested employers might wish to consider.
Source: Sibson.com
Mitigating Longevity Risk in DC Plans Summary: DC plan participants face the risk of outliving retirement assets. However, earlier this month, the IRS issued final regulations that make it easier for 401k plans, individual retirement accounts and other retirement programs to invest in certain annuity contracts that could help mitigate this risk. Article discusses how these regulations will affect 401k's and IRA's.
Source: Jdsupra.com
Court, Legal, Legislative and Washington DC
Lockheed Martin Retirement Plan Case Gets Trial Date Summary: A long-fought legal battle between Lockheed Martin Corp. and a group of its retirement plan participants will finally go to trial in December after the plaintiffs were granted class action status.
Source: Investmentnews.com (free registration may be required)
Appellate Court Sends RJR Stock Drop Suit Back for Review Summary: A lower court applied the wrong standard when determining that R.J. Reynolds Tobacco Company proved its fiduciary breach did not cause losses to retirement plan participants, an appellate court ruled.
Source: Planadviser.com
Compliance and Regulatory Related
IRS Provides Guidance on Retirement Plan Terminations Summary: In Employee Plans News, Issue 2014-11, August 4, 2014, the Internal Revenue Service provides guidance on retirement plan terminations, including partial terminations.
Source: Irs.gov
What a CPA's Plan Audit Does Not Cover -- You'd Be Surprised Summary: What may be a revelation and a bit scary is the extent to which many plan sponsors misunderstand the IQPA's purpose. Many believe the IQPA is more comprehensive than it actually is. Consequently they falsely rely on report as a determiner of the adequacy administrative and fiduciary governance. What they need is another type of review for this purpose.
Source: Fiduciaryplangovernance.com
Amnesty Program for Small Plan 5500 Filings Summary: Civil penalties of up to $1,025 per day up to a maximum of $15,000 may be imposed on companies who fail to file their annual Form 5500 filing by its due date. Luckily there are programs available to be able to submit filings late with a significantly-reduced late filing penalty fee.
Source: Benefit-Resources.com
Marketplace News ASPPA Restructuring Receives Overwhelming Approval Hancock's Slotwinski Named President of NIPA Ekon Benefits Revamps Participant Website, Adds Guidance Lincoln Retirement Appoints Head of Business Development Guardian Introduces Fiduciary Assessment Tool Southwest Securities & Summit Brokerage Adopt Matrix B/D Platform
This eNewsletter is a digest of information published by a variety of web-based sources on 401k and related issues and is published as a service to our users. 401khelpcenter.com, LLC is not the author of the material unless specifically noted. We review each article to ensure that it is related to the interests of our subscribers, but 401khelpcenter.com, LLC does not endorse and disclaims any and all responsibility or liability for the accuracy, content, completeness, legality, or reliability of the material. Reliance on this material should only be undertaken after an independent review of its accuracy, completeness, efficacy, and timeliness. All articles are copyrighted to their publishers. If you believe that your work has been copied in a way that constitutes copyright infringement, please contact the source site immediately. All links were tested before this eNewsletter was e-mailed to you to ensure that they are still functional.
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