Ten Unexpected Changes "Tibble" Really Brings
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Fiduciary and Plan Governance Material Ten Unexpected Changes "Tibble" Really Brings Summary: Article gathers ten potential candidates for what might be call "unexpected" changes that Tibble v. Edison could spawn and fiduciaries need to watch. Source: Fiduciarynews.com 401k Plan Investment Committee Best Practices After "Tibble" Summary: Tibble is unremarkable in that it broke no new ground; the ongoing "duty to monitor" has been long-recognized by both fiduciaries and attorneys alike. The principle take-away from Tibble is the reiteration of risk mitigation best practices for fiduciaries tasked with the selection of investment options for an ERISA plan. Source: Benefitslawadvisor.com An Economist's Perspective of Fiduciary Monitoring of Investments Summary: A central thesis is that ongoing oversight is an exercise in risk management and that risk management is a never ending process. The article emphasizes the importance of (a) examining multiple risk factors and not relying on performance numbers alone, (b) understanding the presence of financial leverage (should it exist), (c) clarifying the role of a service provider when an outside party is used, and (d) letting participants know about the type of monitoring being done by an investment committee. Source: Pensionriskmatters.com Summary: There is a hierarchy of service models available in the 401k marketplace. Each of which offers Plan Sponsors a different level of support with regard to investment selection and monitoring. Here is a brief description of each in the order of lowest to highest fiduciary protection. Source: Retirementplanblog.com
Insight: Studies, Research and White Papers It Pays to Set the Menu: Mutual Fund Investment Options in 401k Plans Summary: This paper investigates whether mutual fund families acting as service providers in 401k plans display favoritism toward their own affiliated funds. Using a hand-collected dataset on retirement investment options, paper shows that affiliated mutual funds are less likely to be removed from and more likely to be added to a 401k menu. Source: Pensionresearchcouncil.org
Items of Special Interest to Service Providers Analysis: Impact of the DOL's Fiduciary Proposal on Independent RIAs Summary: For the most part, the DOL's proposal should not significantly impact independent RIAs. This paper provides the basis for that conclusions. Source: Drinkerbiddle.com Summary: The Bipartisan Policy Center convened what at least one participant termed a "policy wonk throwdown" in the nation's capital May 27. The subject? The Department of Labor's fiduciary proposal. The actual title of the event was "Champions, Critics and Consequences of a New Fiduciary Standard," and it covered all that ground and more. Source: Napa-net.org
Target-Date Funds In-depth Report on Target-Date Fund Glide Paths Summary: Report examines target-date fund glide paths "with the intention of differentiating the good from the bad. Our focus is on fiduciary responsibility and the characteristics of a glide path that make it prudent." Source: Targetdatesolutions.com Summary: Target-date funds have seen tremendous asset growth in recent years, but their investment design hasn't kept pace with available innovations. Article reviews what the next-generation of target-date funds might look like. Source: Abglobal.com
Court and Legal An Analysis of Tibble v. Edison Summary: The Court stated that it believed the lower courts failed to consider the duty to monitor as specified in trust law, sending the case back to the Ninth Circuit for further review. In light of the ruling, article identifies five key issues plan fiduciaries should consider. Source: Fixingthe401k.com Supreme Court Ruling Heightens Pressure on Fiduciaries to Monitor 401k Plan Investments Summary: While Tibble serves as an important warning to ERISA fiduciaries to monitor plan investments continuously, the ruling leaves plan fiduciaries with uncertainty as to the level of monitoring required to fulfill their ERISA fiduciary obligations. Source: Pillsburylaw.com Beneficiary Determined by Plan Document, Not Designation Form Summary: Sometimes conflicting beneficiary designations for 401k plan assets can be tough to sort out when a plan participant dies. It took a verdict from the U.S. Circuit Court of Appeals for the 9th Circuit to resolve one such case, and the ruling may provide useful guidance for benefits administrators going forward. Source: Benefitnews.com
Compliance and Regulatory Related Rollovers for Business Start-ups Summary: IRS agents performing audit reviews and determination letter approvals are alert regarding rollovers as business start-ups (ROBS). When found, they are to study each of case to verify that the rules have not been violated. This article reviews the issues around ROBS. Source: Mhco.com DOL: Employee Benefit Plan Auditors Are Not Making the Grade Summary: The DOL just released a report from a study that the agency conducted on the quality of retirement plan audits. The results are not favorable. It appears that many general accounting practitioners are performing these audits and do not have adequate experience or knowledge to perform sufficient audits under the professional standards. Source: Belfint.com DOL Publishes Plan Audit Quality Report Summary: The DOL's Employee Benefits Security Administration has published this 193 page study on the quality of benefit plan audits performed by certified public accountants. The report reveals serious issues with the current system including that 39 percent of the audits contained major deficiencies which put $653 billion and 22.5 million plan participants and beneficiaries at risk. Source: Dol.gov
Marketplace News Scott Dunbar Joins Mercer Investments as West Market Business Leader Transamerica Retirement Enhances Mobile App UBS to Launch Target-Date CITs MetLife Launches Longevity Product for DC Plans MassMutual Appoints Large Plan Relationship Manager The Standard Appoints New Retirement Plan Consultant Ascensus Appoints New RVP for Rocky Mountain Region TCW Adds Mid-Atlantic Region Marketing SVP MJM401k Expands Consultant Team NFP Acquires Meridian Retirement Plan Advisors Fiduciary Plan Advisors Partners With InHub on RFP Tech
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