DOL's Final Fiduciary Rule Coverage
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In This Issue The papers, articles, and materials published this past week have been, as one might expect, predominately about the DOL's final fiduciary rule released last Wednesday.
DOL's Final Fiduciary Rule DOL's Finalized Fiduciary Rule Released Abstract: As rumored, this morning the Department of Labor finalized a rule and related exemptions that are intended to ensure that retirement savers get investment advice in their best interest -- commonly called the fiduciary or conflict of interest rule. Source: 401khelpcenter.com Department of Labor Finalizes Rule to Address Conflicts of Interest in Retirement Advice Abstract: This is a Department of Labor piece reviewing the final version of the 'Conflict of Interest' rule. Topics include, what is covered investment advice under the rule, what is not covered investment advice under the rule, Best Interest Contract, and applicability date. Source: Dol.gov Chart Illustrating Changes From DOL's 2015 Conflict of Interest Proposal to Final Abstract: Many changes were made in the final version of the DOL's 'conflict of interest' rule to clarify, streamline, and simplify the proposed rule and proposed exemptions. The following 8-page chart was produced by the DOL to shows some of the most frequently raised issues and how the they addressed them in the final rule. Source: Dol.gov Game Changer, Revisited -- The Final Conflict of Interest Rules Abstract: The new conflict of interest rules contain significant changes from the 2015 version, but the overarching theme remains the same: in the brave new world of retirement plan and IRA investment advice, everyone is a fiduciary and must follow ERISA-like rules. Source: Pentegra.com Abstract: Despite some chatter about possible political or legal challenges to the DOL's final fiduciary rule, the huge impacts on the industry are here to stay, according to several experts speaking at the Fi360 Insights conference in San Diego. Source: Fi360.com How Wall Street Emasculated the DOL Rule with an Old-Fashioned End Game Abstract: The authors premise is that, although experts are lauding fiduciary advocates for their successful, if protracted, effort on the new fiduciary rule on the books, there is a certain hollow feeling in the pit of the stomach. "That's because Wall Street lobbyists prevailed on the aspect of the DOL rule that counts -- enforcement." Source: Riabiz.com
Fiduciary and Plan Governance Material The Evolution of ERISA Fiduciary Best Practices Abstract: The defined contribution marketplace and the sophistication of ERISA plan fiduciary has come a long way in recent years. This has resulted in changes in the best practices of those tasked with sponsoring and administering retirement plans governed by ERISA. This article is a summary of some of those best practices. Source: Wagnerlawgroup.com Practical Considerations on Brokerage Windows in 401k Plans Abstract: Plan committees need to ask questions, and get answers, before offering a brokerage window. Should the committee offer one at all? If it does, what is the process for selecting and monitoring the window and its provider? This column by Fred Reish looks at these and other questions about brokerage windows in participant-directed plans. Source: Drinkerbiddle.com Fiduciary Risk in Data Privacy and Cybersecurity Abstract: Retirement plans store extensive personal data on each participant and beneficiary. This data ranges from Social Security numbers and addresses to dates of birth, bank account and financial information, and other records and is stored physically and in electronic forms for years, if not decades. Retirement plan fiduciaries must take precautions to help ensure that they have fulfilled their fiduciary duties with respect to data privacy and cybersecurity. Source: Morganlewis.com
Insight: Studies, Research and White Papers 401k Consultants Say Active Management Preferred Investment Strategy Abstract: Retirement plan consultants say that active management remains the favored investment approach for most major asset classes and target-date retirement strategies, according to the 10th annual PIMCO Defined Contribution Consulting Support and Trends Survey. Source: 401khelpcenter.com Shorter Life Expectancy Reduces Projected Lifetime Benefits for Lower Earners Abstract: The increase in average life expectancy for older adults in the United States contributes to challenges for retirement planning by the government, employers, and individuals. But life expectancy varies substantially across different groups with significant effects on retirement resources, especially for those with low incomes. In this 61-page report, the GAO examined (1) the implications of increasing life expectancy for retirement planning, and (2) the effect of life expectancy on the retirement resources for different groups, especially those with low incomes. Source: Gao.gov
Legislative and Washington DC Senator Jeff Merkley Champions a Cheaper 401k Alternative Abstract: Where others before him have failed, Senator Jeff Merkley of Oregon is championing a new savings vehicle to boost retirement security for the American workforce. He joins a coterie of policymakers and think tank denizens who are concerned about the 68 million full- and part-time workers without access to an employer-sponsored pension. But, Merkley can expect fierce opposition from mutual fund industry lobbyists. Source: Institutionalinvestor.com
Compliance and Regulatory Uncashed 401k Checks: An Issue That's Gaining Attention Abstract: Until recently, uncashed distribution checks were thought to be a relatively minor issue for retirement plans. However, the dimensions of the issue have changed during the past decade with the widespread adoption of automatic enrollment features, increasing rates of voluntary employee turnover, and automatic distributions of smaller account balances. It's an issue that has gained the attention of the DOL. Source: 401kspecialistmag.com Abstract: Employers know that they must honor qualified domestic relations orders (QDROs) that assign a portion of a retirement benefit to a participant's former spouse, known as an alternate payee, when the participant and alternate payee divorce. Those orders by law are not allowed to provide greater benefits than were otherwise provided under the plan. A recent federal district court case ignored that provision when it recognized a retroactive QDRO. Source: Benefitsnotes.com Deadlines to Adopt Restated Pre-Approved DC Plans Abstract: April 30, 2016, is the deadline for employers using pre-approved retirement plan documents to sign an updated version of their 401k, profit-sharing or other defined contribution retirement plans. April 30, 2017, is the extended deadline for any defined contribution pre-approved plan adopted on or after January 1, 2016. Source: Irs.gov
Marketplace News Paychex Announces Fiduciary Rule Solutions Pentegra Adds Regional Director for Upper Midwest TRA Hires Phil Kennedy as Regional Sales Consultant Vanguard Canada Launches 10 Target Retirement Funds
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