DOL Warns the ERISA Fiduciary Debate Is Far From Over
|
Click Here for Our Resource Page on Retirement Plans and the Coronavirus Pandemic In This Issue
Items of Special Interest to Service Providers DOL Warns the ERISA Fiduciary Debate Is Far From Over In a troubling development, the DOL has announced its expectation that it will proceed to propose yet another iteration of investment advice guidance under ERISA -- which would become Rule 4.0 -- possibly on even more radical terms than its 2016 Rule 2.0 that was vacated by the Fifth Circuit Court of Appeals. Source: Eversheds-Sutherland.com Tougher DOL Fiduciary Rule Is on the Way. But When? Attorneys warned this week that Labor is setting up "regulatory whiplash" and huge compliance costs by requiring retirement advisors to comply with a new fiduciary prohibited transaction exemption that it plans to eventually amend. Source: Thinkadvisor.com Marketing Tips for 401k Plan Professionals A webinar this week featured OneAmerica's Sandy McCarthy, the firm's president of retirement services, in conversation with Rebecca Hourihan, founder of 401k Marketing in San Diego. The pair discussed the many marketing challenges facing advisory industry practitioners, with a particular focus on the added complexities of marketing as a woman in a field in which older white men are significantly overrepresented. The pair agreed that marketing is a challenge for all advisers and one which is unfortunately all too often complicated by issues related to discrimination and stereotyping. However, with the right framework and strategies in hand, all advisers can use proven marketing tactics to grow and strengthen their business and their brand. Source: Planadviser.com The Inside Take: Ascensus CEO on GIC, Stone Point Acquisition Ascensus CEO David Musto says the goal of the deal is not for his firm to radically shift its strategy or change its approach to doing business; instead, the transaction is about scale, resources and knowledge-sharing. Source: Planadviser.com Ascensus Sells for $3 Billion After Failing to Draw Buyers for One-Third Less in 2018 Genstar and Aquiline just sold Ascensus at a reported $3 billion valuation after a $2 billion asking price failed to draw buyers three years ago. Stone Point Capital LLC and GIC, Singapore's sovereign wealth fund, rewarded the two private equity investors for their faith and patience with a $1 billion or 50% premium for the Dresher, PA, recordkeeper. Source: Riabiz.com
Fiduciary and Plan Governance Participant Data: Plan Asset or Fair Game for Recordkeepers to Use to Market Non-Plan Products? In an emerging theory of liability, plan fiduciaries' treatment of participants' data is coming under scrutiny. Over the last five years, we have seen how the collection of many individuals' data can become a valuable asset in the right hands, whether it's used to influence an election, design a marketing plan that targets individuals based on their specific preferences and needs, or just to compile large troves of information to analyze trends. Source: Truckerhuss.com »» Click here for more Fiduciary and Plan Governance Material Insight: Studies, Research, and White Papers COVID-19 Retirement Plan Loan Recipients Took More Than Needed Nearly half of individuals who took a loan or withdrawal from their retirement plan during the COVID-19 pandemic agree or strongly agree they withdrew more than they needed. However, a significant amount (68%) of individuals agree or strongly agree they are now in a better place financially because they took a loan or withdrawal, according to new research from Voya Financial. Source: 401kspecialistmag.com The Holy Grail of DC: Income in Retirement While retirement savings plans have undergone significant evolutions over the last four decades, they still fall short in providing workers with lifetime retirement security. A significant gap given DC plans are a primary source of most participant's retirement income. To better understand the current retirement-income landscape within the DC space, PGIM recently completed a survey of more than 130 plan sponsors that have at least one 401k plan and a minimum of $100 million in 401k assets. Source: Pgim.com 401k Fee Study: 75% of Small Business Plans Pay Hidden Fees Employers have a fiduciary responsibility to ensure the fees paid by their 401k plan are "reasonable" so excessive fees do not reduce the investment returns of plan participants needlessly. To do that job, employers should benchmark their 401k fees periodically by comparing them to industry averages and/or the fees charged by competing 401k providers. Sounds straightforward, but this information is hard to find and often harder to compare on an apples-to-apples basis. Source: Employeefiduciary.com »» Click here for More Studies, Research, and White Papers Court and Legal WakeMed Quickly Settles 403b Fee Lawsuit A settlement has been reached in an ERISA fiduciary breach lawsuit filed against WakeMed, an emergency and urgent care operator located in North Carolina. The ERISA lawsuit suggested it failed to meet its fiduciary duties of prudence and loyalty in the operation of a staff retirement plan. Source: Planadviser.com »» Click here for more Court and Other Legal Issues Legislative and Washington DC Senate Bill Would Allow 401k Match for Student Loan Payments Student loan payments would be entitled to earn "matching" 401k retirement contributions from employers under a bill introduced by Senate Finance Chairman Ron Wyden. The proposal would enable Americans to build retirement savings while repaying their student debt even if they can't afford to make their own contributions to a 401k plan. Source: Investmentnews.com (registration may be required) »» Click here for more on Legislative and Washington Actions Cyber and Plan Security 12 Steps to Stronger Cybersecurity for ERISA Plans The DOL has spoken "officially" for the first time regarding best practices for ERISA Plan fiduciaries regarding cybersecurity. Let's set the stage for why this is important news, then review the EBSA's suggested "best practices" for ERISA Plan sponsors, fiduciaries, and service providers, as well as plan participants and beneficiaries. Source: Compliancedashboard.net Cybersecurity Security Best Practices for Retirement Plan Administration The DOL has issued guidance for plan sponsors, plan fiduciaries, plan service providers, and plan participants on best practices for maintaining cybersecurity and protecting retirement plan assets. The guidance does not focus on the cybersecurity of the plan sponsor or the plan fiduciary, but rather the duty of plan fiduciaries for the cybersecurity of plan service providers retained by the plan fiduciaries. Source: Troutman.com »» Click here for more on Cybersecurity Issues Compliance and Regulatory COVID-19: What to Expect for Your 2020 401k Plan Audit As we move into 401k plan audit season, we expect to continue to utilize secured emails and sites; Zoom and Microsoft Teams even more than we did in 2020. Your auditor may request a walk-thru of how your processes are performed by sharing your screen. Some changes may have occurred in your processes and control structure during 2020. Your auditor will ask what those changes were and may test those specific processes and controls. You may be asked for documentation that you had not provided in the past. Source: Lindquistcpa.com IRS FAQs Address COVID-19 Partial Plan Termination Issues The IRS supplemented its online FAQs on COVID-19 relief for retirement plans and IRAs with information related to relief from partial plan terminations. Source: Eforerisa.com What's Missing From Many Plans? Current Addresses for Participants So many extraordinary developments took place last year that some trends fell under the radar. One of these, the sharp uptick in migration out of large U.S. cities, can make a significant impact on sponsors and their plans. Source: Benefitnews.com »» Click here for more Compliance and Regulatory Material Marketplace News 2021 Signature Award Winners Announced Ascensus to Be Acquired by Stone Point Capital and GIC Biden Names Nominee for Labor Department Policy Director
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. 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. Hyperlinks in this document are provided as a convenience and we disclaim any responsibility for information, services, or products found on websites linked hereto. All links were tested before this eNewsletter was e-mailed to you to ensure that they are still functional, but publishers do move or delete articles. Therefore, we can't guarantee that the links provided will remain operational. 401khelpcenter.com does not endorse, approve, certify, or control this material and does not guarantee or assume responsibility for the accuracy, completeness, efficacy, or timeliness of the material. Use of any information obtained from this material is voluntary, and reliance on it should only be undertaken after an independent review of its accuracy, completeness, efficacy, and timeliness. Reference to any specific commercial product, process, or service by trade name, trademark, service mark, manufacturer, or otherwise does not constitute or imply endorsement, recommendation, or favoring by 401khelpcenter.com. Opinions expressed are those of the author of the article and do not necessarily reflect the positions of 401khelpcenter.com. THIS NEWSLETTER IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE INVESTMENT, TAX, ACCOUNTING, OR LEGAL ADVICE. Copyright © 2021 by 401khelpcenter.com, LLC. All rights reserved. No reproductions without prior authorization, but you are free to email this copy (in its entirety) along to colleagues or clients. This newsletter may not be posted on any website. 401khelpcenter.com, LLC
|
