Kohl to Unveil Senate Version of 401(k) Fee Disclosure Legislation

October 25, 2007 (PLANSPONSOR.com) - The Chairman of the Senate Special Committee on Aging said at a hearing Wednesday that consumers have a basic right "to clearly know how much products and services are costing them," referring to the fees charged to 401(k) plan participants.

The hearing called by Chairman Senator Herb Kohl, (D-Wisconsin), this week came a day before another fee disclosure hearing scheduled by the U.S. House Ways and Means Committee to be held Thursday (See Ways and Means Committee to Hear Testimony on DC Plan Fees ).

According to the Business Times, Kohl and Senator Tom Harkin, (D-Iowa), are expected to introduce the Defined Contribution Fee Disclosure Act of 2007 this week, which would require full transparency of 401(k) fees to both employers and participants. 

The Senate bill comes behind a similar proposal introduced in July by U.S. Representative George Miller, (D-California), which also calls for full disclosure of fees to plan participants (See Representative Miller Introduces Fee Disclosure Legislation ).

Miller’s proposal triggered a great deal of criticism at a recent U.S. House Education and Labor Committee hearing, with panelists arguing that such detailed disclosure requirements would impart too heavy a burden on plan sponsors and plan providers and plan participants would be no better off to make investment decisions (See  401(k) Fee Disclosure Proposal Draws Criticism at Committee Hearing ).