Massachusetts Heats Up Fiduciary Rule Discussion With Cold-Blooded Enforcement
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In This Issue
Fiduciary Rule Massachusetts Heats Up Fiduciary Rule Discussion With Cold-Blooded Enforcement Abstract: Financial services firms occasionally implement programs for their representatives to receive incentives in connection with specific product or service offerings. For as long as firms have used such programs, securities regulators have scrutinized them. The latest iteration of regulatory attention to sale incentives signals a shift in strategy that carries broader implications for financial firms. Source: Winstead.com Firms May Need to Rethink DOL Rule After Scottrade Charges Abstract: A decision by Massachusetts' regulators to file state charges against Scottrade by claiming it violated the Department of Labor fiduciary rule has surprised many industry analysts. In short, the state claims Scottrade ignored the policies and procedures it put in place starting June 9 to comply with the DOL rule. Source: Advisornews.com »» Click here for more on the DOL's Fiduciary Rule General Items Managed Accounts: You Can't Always Get What You Want Abstract: Due to limited product availability on recordkeeping platforms, plan sponsors may not be able to get what they want. But in looking at the choices they do have, they may be able to get plan participants what they need. Source: Callan.com Safe Harbor 401k Plans Make Sense for Many Businesses Abstract: According to a 2016 study by SHRM, 68% of 401ks are safe harbor plans. But while the rules are straight forward and the benefits are significant, there are still many plans which have not yet implemented a safe harbor match of any kind. This article explores the requirements and share some examples of safe harbor plans. Source: Belr.com Fiduciary and Plan Governance Material Investment Committees Misnamed Causing Confusion by 401k and 403b Plan Sponsors Abstract: Traditionally, the governing committee for 401k and 403b plans have been called "investment committees" which can cause confusion and might even be harmful. They should be called "retirement committees" or even "benefits committees." Here's why. Source: 401ktv.com Risk vs. Readiness: The 401k Plan Annuity Conundrum Abstract: Annuities present some hurdles for plan sponsors when it comes to plan administration and managing costs for the retirement plan and its participants. Fiduciary risk still looms large also. Because annuities must pay out over the lifetime of the purchaser, plan sponsors have to select a provider that will be able to pay benefits for a long time. Source: Shrm.org Fiduciary Liability Insurance, Why You May Need It Abstract: Fiduciary liability insurance isn't the same thing as your ERISA bond and should never be viewed as a substitute for good fiduciary practices, but it is good to know you have backup if claims do arise. Source: Cohenbuckmann.com Section 404(c) Is the Exception, not the Rule Abstract: Section 404(c) is a historically misunderstood part of ERISA, with misconceptions rampant even before the 404(a)(5) participant fee disclosure regulations added to the confusion. The general rule is that ERISA plan fiduciaries are liable for all aspects of selection and monitoring of plan investments, and are on the hook for any participant claims for fiduciary breaches should something go wrong. Section 404(c) is a limited exception to this general rule. Source: Ntsa-net.org »» Click here for more Fiduciary and Plan Governance Material Items of Special Interest to Service Providers Fiduciary Conduct Is Good for Business Abstract: The focus on compliance obscures the compelling business case that fiduciary conduct (1) is what clients want, (2) is operationally efficient and reliable, (3) strengthens client-adviser relationships and makes them more enduring, (4) provides the adviser with greater pricing power, and (5) enhances the advisory firm's brand and market valuation. Source: Investmentnews.com (registration may be required) 403(b) Plans Funds, Fees, and Annuities, a Guide to 403b Investment Options Abstract: Unlike qualified plans under Section 401, 403b plans are restricted to only three investment options. This article discusses the differences between these three options (annuities, custodial accounts, and retirement income accounts) including their legal definitions, permitted investments, asset commingling, contract exchanges and transfers, distributions, excise taxes, and fees. Source: Greensfelder.com »» Click here for More 403(b) Material Court and Legal ERISA Class Actions Settlements Cost Employers Nearly $1 Billion in 2017 Abstract: Class action settlements and court decisions related to 401k retirement plans in 2017 significantly affected the direction of ERISA litigation, according to the newest edition of an annual law firm report on workplace class action lawsuits. Source: Blr.com Fidelity Stable Value Fund Suit Gets Final Dismissal From Appellate Court Abstract: The court said the plaintiffs claim that Fidelity agreed to overly conservative investment guidelines in a failed effort to lock up all wrap coverage so that its competitors would not be able to obtain such coverage made little sense. Source: Planadviser.com »» Click here for more Court and Other Legal Issues Legislative and Washington DC Tax-Reform Changes Lead Some Employers to Raise 401k Matches Abstract: A handful of large U.S. corporations announced they are raising the employer match for their 401k retirement plans or are making other changes in their benefit plans in the first month after a tax reform law was signed by President Trump. And nearly half of companies surveyed said they are considering taking such an action this year or next. Source: Blr.com »» Click here for more on Legislative Actions Compliance and Regulatory How Should We Handle It If We Accidentally Overfund Our 401k Match? Abstract: This year, when the plan's TPA calculated the total match and profit sharing contributions for the year, it was discovered that employer funded more than was needed. What are the options for applying the amount overfunded? Can it be carried over and apply it to next year's contribution? Source: Dwc401k.com Budget Act of 2018 Brings Changes for Hardship Distributions Abstract: The Bipartisan Budget Act of 2018 was passed into law on Feb. 9, 2018 and introduces some unexpected changes for retirement plans. The most significant of the Act's changes for retirement plans reduces the existing restrictions on hardship distributions from 401k and 403b plans. Source: Icemiller.com Tax Reform's Impact on 401k Plan Loan Offset Treatment Abstract: The recent Tax Cuts and Jobs Act of 2017, enacted on Dec. 22, 2017, contains a few rules that will impact benefit administrators. This article focuses on retirement plan administrators' and HR benefits managers' obligations relating to plan loan offset amounts. Source: Hklaw.com »» Click here for more Compliance and Regulatory Material Marketplace News Fi360 Anveiled Agenda and Keynotes for 2018 Annual Conference »» Click here for More Marketplace News
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