On April 4th, the Department of Labor (DOL) announced that it would be delaying the applicability date of its Conflict of
Interest Rule (also known asthe Fiduciary Rule) by 60 days. This moves the applicability date of the rule back from April 10th to June 9th.
Next, the DOL will be considering whether to leave the rule unchanged, to revise the rule, or to rescind the rule all together. It’s unclear whether this determination can be made within 60 days or whether the DOL will pursue an additional delay in the applicability date. Continue reading
After more than six years of work, much anticipation, and monumental changes in the financial industry in preparation, the Department of Labor’s Conflicts of Interest Rule (also referred to as the Fiduciary Rule) is set to become applicable on April 10th, 2017. However, it is unlikely that this fledgling rule will ever actually see the light of day.
The world seems to have changed a great deal in recent days, but at least one thing remains unchanged. Another excessive fee lawsuit has been filed, this time in the Eastern District of Michigan against Xerox HR Solutions, Inc. The plaintiffs are participants in three Ford Motor Company retirement plans, and are seeking class certification to make this suit a class action suit. The combined assets of the three plans come to nearly $14 billion.
For many people August is a time of new clothes, haircuts, and school supplies. For others, it’s a time to file excessive fee lawsuits against universities with multi-billion dollar retirement plans in quick succession.
As anyone who deals with the administration of qualified retirement plans knows, mistakes happen. This is a fact that the IRS is well aware of, and the last thing that the Service wants to do is harm participants by disqualifying their company’s retirement plan. For this reason, the IRS has established the Employee Plans Compliance Resolution System (“EPCRS”). This system allows plan administrators to make voluntary corrections without risking disqualification of their plan. Continue reading
In 2013 MassMutual was sued by a class of over 14,000 participants of its own 401(k) plan for charging the Plan excessive fees for record keeping services, among other things. The case was filed by the St. Louis based law firm Schlichter, Bogard & Denton, and was recently settled for $30.9 million. Continue reading
As the Department of Labor’s (DOL’s) new, expanded fiduciary rule continues to become clearer (see our recent blog post), it’s important to step back and keep in mind what it means to be a fiduciary to a retirement plan. The fiduciary standard of conduct is known as the highest standard of conduct under the law. A fiduciary to a retirement plan, under ERISA, must (1) act solely in the interest of plan participants, and (2) act as a prudent person would act in the same situation. Continue reading
The Department of Labor’s (DOL’s) long anticipated fiduciary rule has finally been released, and it will become effective (for the most part) on April 10th, 2017. The new rule in its final form broadens the definition of “fiduciary” in order to cast a wider fiduciary net over more financial professionals in the retirement planning industry.
A multiple employer plan (MEP) is a single plan that is adopted by several employers who are not under the same corporate ownership umbrella. Historically, in order to establish a multiple employer plan all of the employers joining the plan must share a “common nexus.” This means that they must be in some way related to each other, for example, by doing business in the same industry. Two unrelated businesses are not allowed to sponsor a multiple employer plan together. Continue reading
We’re now one month into 2016, and on pace to see more excessive fee lawsuits this year than in any previous year. Schlichter, Bogard & Denton out of St. Louis has filed yet another law suit against a retirement plan sponsor for imprudently selecting and retaining poorly performing mutual funds, allowing participants to be charged excessive record keeping fees, and prohibited transactions between the plan and a party in interest. Continue reading