Biden's DOL to Implement Trump Fiduciary Rule
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Items of Special Interest to Service Providers Biden's DOL to Implement Trump Fiduciary Rule The DOL announced that it will allow a Trump-era exemption for investment advice fiduciaries to move forward. The exemption, "Improving Investment Advice for Worker & Retirees," grants certain forms of compensation for fiduciary advice and will go into effect as scheduled on February 16. Source: 401kspecialistmag.com DOL Confirms Investment Advice PTE The DOL has confirmed that the Trump administration's "Improving Investment Advice for Worker & Retirees" Prohibited Transaction Exemption for investment advice fiduciaries will go into effect as scheduled on February 16, 2021. The DOL adds that "in the coming days" it will publish related guidance for retirement investors, employee benefit plans, and investment advice providers. Source: Asppa.org The Array of ERISA Compliance Solutions for Rollover Advice The DOL's new rollover position requires financial service providers that are or may be ERISA fiduciaries to consider potential compliance solutions. This article provides an overview of the compliance alternatives: Is it possible and appropriate to assist with rollovers without taking on ERISA fiduciary status? If not, is it possible and appropriate to neutralize any conflict of interest embedded in the rollover advice? If not, is there an applicable ERISA prohibited transaction exemption that provides conflict of interest relief? Source: Eversheds-Sutherland.com General Items It's the 401k Plan Sponsor's Responsibility, Just Because It Is There are many times that plan sponsors have to be told that they are responsible for "such and such a thing" and they are on the hook "just because." This article is about the stuff that a 401k plan sponsor is responsible for, whether it's fair or not. Source: Jdsupra.com Student Debt and Retirement: The Pupil-Participant Dilemma Student debt has garnered attention among recordkeepers as younger generations enter the workforce. The retirement industry has opened its doors to helping participants balance paying down student debt while still contributing to their retirement plans. Recently, multiple major recordkeepers engaged third-party firms to offer student loan management services to participants. These programs' offerings vary, but some standout features include refinancing services, repayment option education, and scholarship search tools. Source: Corporateinsight.com Insight: Studies, Research, and White Papers NEPC's 2020 Defined Contribution Plan and Fee Survey NEPC's 15th annual Defined Contribution Plan and Fee Survey focuses on measuring financial success for DC plans and participants and benchmarking industry fees. As part of the 2020 survey, it explores how plan sponsors can improve their participants' financial success by using plan features to increase savings rates, professionalize investment decisions, and facilitate the distribution of assets at retirement. Source: Nepc.com Infographic: Financial Insecurity in Retirement for Black Americans This infographic leverages the Federal Reserve's Survey of Consumer Finances to explore factors that threaten financial security for many Black Americans while highlighting opportunities from Fidelity research and insights to help close the financial wellness gap among underrepresented employees. Source: Fidelity.com »» Click here for More Studies, Research, and White Papers Court and Legal Another MEP Targeted in Excessive Fee Suit The platform may be different, but the excessive fee allegations directed toward a multiple employer plan are all too familiar. The plaintiff this time was employed by Heartland Coca-Cola Bottling Company an employer that participated in the Coca-Cola Bottlers' Association 401k Retirement Savings Plan, a multiple employer plan. The plan covers about 19,000 participants, and as of December 2019 had nearly $800 million in assets spread across 24 investment options, including a Coca-Cola Common Stock Fund. Source: Napa-net.org Abbott Lab Defense Again Succeeds in ERISA Case The U.S. District Court for the Northern District of Illinois, Eastern Division, has ruled once again in an ERISA lawsuit involving Abbott Laboratories and the Abbott Laboratories Stock Retirement Plan. Technically, the latest ruling grants Abbott Lab's motion to dismiss an amended complaint that was filed in the suit after the court soundly rejected the plaintiff's initial formulation. Source: Planadviser.com Land O'Lakes ERISA Excessive Fee Suit Receives Mixed Ruling A new ruling published by the U.S. District Court for the District of Minnesota in an ERISA fiduciary breach lawsuit targeting the Land O'Lakes dairy company grants some elements of the defense's motion to dismiss while rejecting others. Source: Planadviser.com »» Click here for more Court and Other Legal Issues Legislative and Washington DC Multiemployer Plan Bailout Caps Benefit Plan Limits Legislation before the House Ways & Means Committee plans to help pay for a multiemployer plan bailout by utilizing a budget gimmick that would freeze retirement plan contribution limits, though not for collectively bargained plans. More specifically, the Butch Lewis Emergency Pension Plan Relief Act of 2021, included as subtitle H of a nine-part package that the committee plans to mark up this week, would impose a cost-of-living freeze. Source: Asppa.org SECURE Act 2.0: Key Provisions Affecting Retirement Plans Late last year, House Ways and Means Committee Chairman Richard E. Neal and Ranking Member Kevin Brady introduced the Securing a Strong Retirement Act of 2020, a bipartisan legislative proposal that includes changes designed to encourage plan adoption, promote retirement savings, and fix certain plan administration problems. As retirement income issues gain an expanding focus, broker-dealers, RIAs, and their advisors need to understand changes that could impact their clients. This article comments on a number of the key provisions. Source: Brokerdealerlawblog.com »» Click here for more on Legislative and Washington Actions Compliance and Regulatory What Is a Soc-1 Report and Why Is It Important to Your Plan? From the Auditor Perspective Plan sponsors of 401k plans, both large audited plans, as well as smaller plans, have most likely run into a key document that remains a mystery as to what it is for and what are plan sponsors supposed to do with it. The document is the annual SOC-1 report for the key service providers to your retirement plan. Let's take a few minutes to look at this report and gain a better understanding of what it is for, as well as what plan sponsors should be doing with it. Source: Linkedin.com DOL Guidance on Illustrating DC Plan Lifetime Income The DOL requested and received many comments on its interim final rule on illustrating DC plan lifetime income in participant statements. They advised that the illustration requirements might change before the notice requirement is effective. It has also stated it will issue a revised rule before September 18, 2021, when the interim final rule takes effect. Source: Segalco.com Watch Employee Turnover Rate to Avoid Partial Termination If you have laid off more than 20% of your plan participants over your plan year -- an unfortunate necessity for many employers during the COVID-19 pandemic -- the IRS could deem that your retirement plan has undergone a partial termination. Such a partial termination would trigger the immediate vesting of all employer contributions made to the plan on behalf of the laid-off participants, even if they had not satisfied your regular vesting requirements. IRS guidance and the Consolidated Appropriations Act provide instruction and relief. Source: Orba.com Puerto Rico Treasury Announces Retirement Plan Limits for 2021 The Puerto Rico Treasury Department issued Internal Revenue Circular Letter No. 21-01 notifying the retirement plan limits that will apply to retirement plans qualified under Section 1081.01 of the Puerto Rico Internal Revenue Code for the year 2021. Source: Mcvpr.com »» Click here for more Compliance and Regulatory Material Marketplace News Transamerica Rolls Out Remote Online Notary Service TRA Announces Acquisition of R. Bruce Tanner & Associates
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