| Benefit Briefs | Decades-Old DB Benefit Payments Being Questioned | Law firms say they are seeing a growing number
of claims for pension benefits that were paid or rolled over decades ago by
former employees who either do not recall receiving or rolling over their
benefits or who are questioning the amount of benefits they received. Pat
DiCarlo, counsel with Alston & Bird’s Employee Retirement Income Security
Act (ERISA) Litigation group in Atlanta, explains that the claims his firm is
seeing are brought through defined benefit (DB) plans’ formal administration
process and have not yet reached litigation. He tells PLANSPONSOR the trend is
new but is becoming more prevalent. “There are at least three different
iterations of the claims,” he says. | Shift from DB to DC Stabilizing | A new analysis of retirement plan offerings at
Fortune 500 companies suggests the shift from defined benefit (DB) plans to
defined contribution (DC) plans may be slowly stabilizing. Towers Watson says
fewer companies today are actively moving away from DB plans and establishing
DC plans for new salaried employees than at any other point over the past
decade. The analysis also suggests a few industry sectors—notably the insurance
and utilities sectors—are bucking the general trend of moving from DB to DC
retirement plans. More than half of the companies operating in the insurance
and utilities sectors still offer DB and DC retirement plans to new salaried
employees. | | Buyer's Market | Eugene Oppo has joined Sibson Consulting’s New
York corporate benefits team as a senior vice president. He reports to Dan
Fries, senior vice president and leader of the New York corporate benefits team
at Sibson. Sibson Consulting, a member of The Segal Group, provides strategic
human resources solutions to corporate and non-profit employers and
professional service firms. | Guardian Adds Investment Options to Retirement Platforms | The Guardian Insurance & Annuity Company,
Inc. (GIAC) added 21 investment options to The Guardian Choice and The Guardian
Advantage group retirement plan products. The additions include offerings from
new fund families, such as American Funds, Morgan Stanley Investment
Management, Natixis Funds, OppenheimerFunds and Putnam Investments. New funds
are also being added from existing fund families. | | Economic Events | In the week
ending August 30, the advance figure for seasonally adjusted initial claims for
unemployment insurance was 302,000, an increase of 4,000 from the previous
week’s unrevised level of 298,000, the Labor Department reported. The four-week
moving average was 302,750, an increase of 3,000 from the previous week’s
unrevised average of 299,750.
The average interest rate for a 30-year fixed-rate
mortgage is 4.10%, unchanged from one week ago, according to Freddie Mac. The
average interest rate for a 15-year fixed-rate mortgage is 3.24%, down from
3.25% one week ago.
| | Market Mirror | Thursday, the Dow slipped 8.70 points
(0.05%) to 17,069.58, the NASDAQ fell 10.28 points (0.22%) to 4,562.29, and the
S&P 500 was down 3.07 points (0.15%) at 1,997.65. The Russell 2000 lost
4.99 points (0.43%) to finish at 1,167.21, and the Wilshire 5000 closed 43.20
points (0.20%) lower at 21,169.98.
On the NYSE, 3.2 billion shares traded,
with decliners outnumbering advancers 2 to 1. On the NASDAQ, 2.8 billion shares
changed hands, with 1.5 declining issues for every advancing issue.
The price of the 10-year Treasury note decreased
16/32, increasing its yield to 2.456%. The price of the 30-year Treasury bond
climbed 1 12/32, with its yield down to 3.215%.
| | Rules & Regulators | More Retirement Plans May Invest in CITs | More retirement plans may get the benefits of
collective investment trusts (CITs) under a new Internal Revenue Service (IRS)
ruling. Revenue Ruling 2014-24 modifies the rules regarding 81-100 group trusts
by clarifying that assets held by insurance company separate accounts may be
invested in 81-100 group trusts under some circumstances. Louis Mazawey, an
attorney with Groom Law Group in Washington, D.C., explains that “81-100 group
trusts” is the IRS’ name for CITs. He tells PLANSPONSOR the ruling has
implications for 401(a) and governmental 457 plans, including governmental
403(b)s, as well as plans that invest in stable value funds. | Lessons from Spiewacki v. Ford Motor Company | How binding are the calculations of pension
benefits in a retirement benefit statement, and what measures can guard a plan
from culpability over errors? | | Financial Sense | Falling interest rates precipitated by
geopolitical tensions led to higher liabilities and a lower funded status for
the typical U.S. corporate pension plan in August, according to the BNY Mellon
Investment Strategy and Solutions Group (ISSG). Yet, rising asset values
benefited public plans, foundations and endowments. The funded status of the
typical U.S. corporate pension plan in August fell 0.7 percentage points to
90.1%, as liabilities rose 3.3%, outpacing the 2.6% return for assets,
according to the BNY Mellon Institutional Scorecard. | | Small Talk | ON
THIS DATE: In
1774, in response to the British
Parliament’s enactment of the Coercive Acts in the American colonies, the first
session of the Continental Congress convened at Carpenter’s Hall in
Philadelphia. Fifty-six delegates from all of the colonies except Georgia
drafted a declaration of rights and grievances and elected Virginian Peyton Randolph
as the first president of Congress. In 1877,
Oglala Sioux chief Crazy Horse was fatally bayoneted by a U.S. soldier after
resisting confinement in a guardhouse at Fort Robinson, Nebraska. A year
earlier, Crazy Horse was among the Sioux leaders who defeated George Armstrong
Custer’s Seventh Cavalry at the Battle of Little Bighorn in Montana Territory. In
1958, Boris Pasternak’s romantic
novel “Dr. Zhivago” was published in the United States. The book was banned in
the Soviet Union, but still won the Nobel Prize for Literature in 1958. In 1964, “House of the Rising
Sun” by the Animals topped the U.S. pop charts. In 1972, during the Summer Olympics at Munich, in the early morning, a
group of Palestinian terrorists stormed the Olympic Village apartment of the
Israeli athletes, killing two and taking nine others hostage, and demanding
that Israel release more than 230 Arab prisoners being held in Israeli jails as
well as two German terrorists. In 1975,
in Sacramento, California, an assassination attempt against President Gerald
Ford was foiled when a Secret Service agent wrested a semi-automatic
.45-caliber pistol from Lynette “Squeaky” Fromme, a follower of
incarcerated cult leader Charles Manson. In 1986, Merv Griffin aired his final program for Metromedia
Television after 23 years on various talk shows. In 2005, Katie Couric made headlines and TV history with her debut as
the first female solo anchor of a weekday network evening news broadcast, “CBS
Evening News with Katie Couric.”
And now it’s time for FRIDAY FILES!
| I like this promotion from IKEA for the
“bookbook.” | Did these people really just steal a cow by
stuffing it in the back seat of their car? | In Fayetteville,
Arkansas, a woman was arrested for suspicion of stealing $144 worth of eye
shadow. Not funny until you see the mug shot. | In London, England, sewer
officials found the cause of a flooding problem in a residential neighborhood.
They said it was a “fatberg” the size of a 747 plane. According to UPI, Dave
Dennis, Thames Water sewer operations manager, said the blockage was comprised
of cooking fats that had been poured down the city’s drains and hardened along
with debris including wet wipes, tennis balls and pieces of wood. “Fat
goes down the drain easily enough, but when it hits the cold sewers, it hardens
into disgusting fatbergs that block pipes,” he said. Workers used
high-powered jets to break up the fat and clear the blockage beneath the
neighborhood.
In Austin, Texas, a man
stormed into his neighbor’s yard while the neighbor was using his radio to talk
to his father and, without saying a word, started to use ‘aggressive’ hand
gestures indicating he wanted to fight. The neighbor said the man
broke his radio’s antenna and then head-butted him, without speaking, according
to the local ABC news station. The neighbor went inside, fearing for his
safety. After the neighbor went inside, the man dumped his radio over the
fence. An arrest affidavit says the man felt his neighbor was trying to “get
into his head.”
| Somewhere in Russia, Mickey Mouse, SpongeBob and two other “loveable” characters
fought a motorist. | In Jharkhand, India, an
18-year-old girl from a remote village has been forced to marry—a dog.
According to the New York Post, a local guru convinced the teenager’s parents
she was under an evil spell and that marrying a man would only bring
destruction to the family and the community. The village elders believe the
evil spell will be passed on to the dog. “After that is done, the man I will
marry will have a long life,” the girl said, according to the news report. A traditional Hindu ceremony was performed. Around 70 members of the
village and the girl’s family attended the ceremony. Munda will now have to
live with the dog and raise him for the next few months, but village customs
say she is free to marry again without having to go through a divorce. The girl said many weddings like this have taken place in her village
and neighboring villages.
In Portland,
Oregon, a family’s three-year-old Great Dane was vomi.ting and ga.gging all
day one day recently, so they took it to a veterinary hospital. Vets looked at
abdominal radiographs and found “a large quantity of foreign
material” in the dog’s stomach, the local CBS news station reported. The
vets performed an exploratory surgery, and removed 43 and 1/2 socks from the
dog’s stomach. The dog is fine and went home one day after the surgery.
Have a great weekend,
everyone! | Share the good news with a friend! Pass the Dash along – and tell your
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