Understanding Excessive Fee Litigation Risk in Retirement Plans
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In This Issue
Fiduciary and Plan Governance Understanding Excessive Fee Litigation Risk in Retirement Plans Plaintiff firms continue to be creative in bringing forth fiduciary claims against organizations and those who oversee their retirement programs. It's not enough to just have the right insurance coverage. Organizations need to institute the right internal governance processes to manage their fiduciary liabilities and risks. Source: Newfront.com Successful Acquisitions Include Thorough Retirement Plan Due Diligence For an acquiring organization, due diligence of a target company's retirement plan may not be at the top of the list of acquisition activities. However, a focused review of the retirement plan can help achieve a successful purchase. A thorough due diligence team can identify potential risks and liabilities, compliance issues, and other retirement plan concerns. Source: Usi.com »» Click here for more Fiduciary and Plan Governance Material Insight: Studies, Research, and White Papers Help or Hype: AI's Impact on the Retirement Plan Space Global adoption of artificial intelligence in all industries is happening at a breakneck pace, the retirement plan space included. It's not a question of if, but how, it will affect plan advisors, sponsors, and participants. The author spoke with top advisors and experts about what to expect. Source: Napa-net.org Inflation Is Reshaping Retirement Outlooks, MFS Reports Persistent inflation is taking a toll beyond the shopping cart, according to a new report by MFS Investment Management. After two years of larger-than-average inflation, cost concerns are driving workers to be more conservative in decisions such as how long they plan to work, as well as their investment choices, according to a survey the firm conducted among 1,000 plan participants. Source: Planadviser.com Almost Half of Americans Not Confident in Their Retirement Plans A survey from Western & Southern Financial Group is the latest to highlight a lack of professional planning -- and therefore confidence -- in retirement plans with inflation having added a new layer of concern. The upward trend in life expectancy has been evident for many years and yet still millions of Americans do little to plan for the large chunk of their lives that will live in retirement. Source: Investmentnews.com Navigating the Number Jumble: A 403b, 401k, and 457b Comparison Over the years, through regulation changes and plan design mandates, the three predominant types of defined contribution retirement plans have grown more similar. Still, understanding the nuances of employer-sponsored retirement plans can be daunting. This article explores the most significant distinctions of 403b, 401k, and 457b plans and their impact on the availability, benefits, and limitations of these plan types. Source: Benefitslawadvisor.com »» Click here for More Studies, Research, and White Papers Items of Special Interest to Service Providers DOL Fiduciary Proposal Expected by End of October The Office of Management and Budget held its final meetings on the DOL's new fiduciary rule proposal, and a full proposal is likely to be released by the end of October, retirement industry sources speaking on background confirmed this week. The OMB is currently considering a draft proposal submitted by the DOL which the budget office must first approve before it is sent out for comment. Source: Planadviser.com The Game is Changing for Target-Date Funds In Target-Date fund providers struggle to compete, Pensions & Investments reports: "More fund closings, fewer launches as five giant firms maintain grip on market. The target-date fund market is becoming saturated, causing providers to liquidate... in an industry dominated by five companies with nearly 80% of the market share." Source: 401kspecialistmag.com Legislative and Washington DC Controversial "Retirement Savings for Americans Act" Reintroduced in Congress A bipartisan, bicameral bill that would make saving for retirement attainable for all American workers is once again on the Congress floor, and now backed by mega-corporations and industry leaders. If passed, the RSAA would allow the federal government to match contributions for low- and middle-income workers, with the match beginning to phase out at median income. Source: 401kspecialistmag.com »» Click here for more on Legislative and Washington Actions Cyber and Plan Security How to Stay Safe From Evolving Cybersecurity Threats To minimize the impact of potential cyberattacks, organizations should work with investment managers on complying with the Securities and Exchange Commission's new cybersecurity rules, should adopt prevention measures against threats, and should be prepared to respond if an attack happens, experts say. Source: Planadviser.com »» Click here for more on Cybersecurity Issues Compliance and Regulatory IRS Updates Regulations for Use and Timing of Forfeitures Over the years, the IRS had an item on its annual guidance plan to update the existing regulations on forfeitures. Well, that guidance is finally here in the form of proposed regulations and it comes with very welcomed transition relief for plan sponsors that have not been as diligent with timely forfeiting and using forfeitures. The proposed regulations impact both defined contribution and defined benefit plans and are described in the article, in question-and-answer format. Source: Groom.com 404(a)(5) Participant Fee Disclosures: Rules and Requirements The DOL requires 401k providers to send fee disclosures to employees and plan administrators. This helps both parties make informed decisions about the plan. This discusses the 404(a)(5) fee disclosure and key disclosure rules and requirements. Source: Forusall.com Earlier this year, the Department of Labor, Internal Revenue Service, and the Pension Benefit Guaranty Corporation released two Federal Register Notices announcing changes to Form 5500 effective for plan years beginning on or after January 1, 2023. Here is a review of the five key changes. Source: Fidelity.com Information on IRS's Compliance Program Priorities and VCP Two recent IRS releases are of interest to retirement plan sponsors. The first updates information about its Voluntary Correction Program. The second provides information about alignment of the compliance program and priorities of the IRS's Tax Exempt & Government Entities Division, which includes employee plans, with the agency's broader Strategic Operating Plan that encompasses increased audits. Source: Segalco.com The Time for Long-Term Part-Time Employee Eligibility Compliance Has Nearly Arrived When the original SECURE Act was passed in 2019, compliance with its new long-term part-time employee rule seemed far in the future, way out to January 1, 2024. Well, that time is nearly upon us, so sponsors of 401k plans should be ready to let these long-term part-time employees start participating in their plans with the start of the New Year. Source: Benefitslawadvisor.com DOL: Brokerage Windows Not Subject of Increased Investigative Efforts The DOL has denied that it planned to increase investigative efforts targeted at brokerage windows following the release last year of a compliance assistance bulletin implying that investigations would extend to plans that offer cryptocurrency through a brokerage window. Source: Napa-net.org »» Click here for more Compliance and Regulatory Material Marketplace News 2024 Retirement Plan Adviser of the Year Nominations Open BlackRock Launches Suite of Target-Date ETFs NAPA Announces the 2023 Top Women Advisors intellicents Taps The Standard to Roll Out the intelli(k) PEP
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