Sharing findings of a recent Capital One survey, Stuart Robertson says there is opportunity to educate employees about the tax-deferred status of retirement plan contributions and retirement plan investment fees.
Tag: retirement plan fees
A lawsuit alleges that the defendants failed to take advantage of the plans' bargaining power by only offering actively managed retail mutual funds as investment options.
The lawsuit not only calls out Fidelity’s use of all proprietary funds in its 401(k) investment lineup, but also accuses it of not negotiating for revenue sharing rebates, not using the lowest-cost share classes, not investigating alternative investment vehicles and not evaluating stable value fund options when its money market funds poorly performed.
The original complaint accuses T. Rowe Price 401(k) plan trustees of breaching their fiduciary duties under ERISA by either failing to remedy their predecessors’ breaches, or, in a few cases of offering expensive retail class versions of proprietary mutual funds, waiting too long to act to shift into lower cost versions of the funds.
While the first lawsuit focused on excessive recordkeeping, administrative and investment fees, the new lawsuit focuses specifically on the university’s practices with regard to revenue sharing.
The EBSA’s Plan Investment Conflicts (PIC) project have reviewed conflicts of interest of fiduciary service providers and investment managers of plan asset vehicles that led to conflicted decision making processes, imprudent application of investment guidelines and the payment of excessive fees.
The bank has agreed to pay $21.9 million to settle charges it benefited from including proprietary funds in its 401(k) plan.
In the first university 403(b) plans case to go to trial, a federal district court found the plaintiffs have not proven that the NYU retirement plans committee acted imprudently or that the plans suffered losses as a result.
A federal judge denied dismissal of plaintiffs’ allegations that a prudent fiduciary would have chosen one—rather than two—recordkeepers; that a prudent fiduciary in like circumstances would have solicited competitive bids; and a claim regarding recordkeeping fees.
Fee-levelization and zero revenue sharing are the newest trends for retirement plan fees.
The plan to adopt a fee-leveling approach and rebate revenue sharing to participants comes as many institutions of higher learning face lawsuits challenging their 403(b) plan fees.
In addition to a monetary payment, the university has agreed to structural changes to its 403(b) plans.
The suit challenges fees paid to provider TIAA.
The bank admitted that because of “a system error,” revenue sharing payments were not credited to the retirement fund, but says the error has been fixed.
Only 49% said they had read their fee disclosure in the prior year and had understood it; 44% said they had not read it; and 7% said they had read the disclosure but did not understand it.
A federal district court judge denied dismissal of most violation of duty of prudence claims.
The university also asks that the plaintiffs not be able to attempt to use evidence that their prudent measures and conduct that occurred subsequent to the plaintiffs’ filing of the lawsuit proves that prior conduct was imprudent.
The defendants argued that a court decision in a self-dealing lawsuit against Wells Fargo supports their motion to dismiss their suit.
Plan sponsors who have already submitted an Application for Determination for Terminating Plan in 2018 will receive a refund of $700.