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FOR IMMEDIATE RELEASE

CONTACT:
Pecanne Jennings
Chief Marketing Officer
703.516.9300
pjennings@aspa.org

ASPPA SEEKS LEVEL PLAYING FIELD IN LATE-DAY TRADING PROPOSAL

February 6, 2004 - (Arlington, Va.)- The American Society of Pension Actuaries (ASPPA) announces that it has filed comments with the Securities and Exchange Commission (SEC) on an alternative to the ‘hard 4 p.m. close’ proposal that will maintain fair competition among businesses offering retirement plan services, and thus ensure that both plan sponsors and participants continue to enjoy a broad selection of funds at reasonable cost.

The proposed SEC regulations would allow a mutual fund company (or its designated transfer agent) flexibility to offer plans that can accept participant instructions up to a cut-off time shortly before 4 p.m., provided plan investment options are restricted to the mutual fund company’s own family of funds. In contrast, other plan recordkeepers and administrators will be required to cut-off receipt of participant instructions far earlier in the business day to complete plan transaction processing and submit the orders before 4 p.m. Therefore, plan sponsors seeking more timely order processing may select a fund's designated transfer agent to perform plan administration and recordkeeping services and limit plan investments to a single mutual fund complex. Ultimately, this trend could reduce industry competition, increase administrative and investment management fees charged to participants and cause plan sponsors to imprudently limit the investment options available to participants that could adversely affect the participants' ability to save for a secure retirement.

According to ASPPA Executive Director, Brian H. Graff, “We believe that the proposed ‘hard 4 p.m. close’ will reduce industry competition and innovation. It is critically important that any SEC rule maintain a level playing field in the retirement plan industry marketplace. Plan sponsors and participants will be the real losers if SEC regulations give only a single sector of the retirement plan industry a competitive advantage.”

ASPPA has proposed to the SEC a solution that recognizes the special administrative requirements of retirement plans which leverages existing industry technology and an independent audit process. According to Bruce Ashton, Esq., ASPPA President, “We are urging the SEC to consider ASPPA’s technology solutions and implement rules following the approach of H.R. 2420 since we believe it’s a secure way to prevent late-day trading without dramatically increasing the administration costs of retirement plans. Alternatively, if the SEC chooses to adopt an alternative to the ‘hard 4 p.m. close’, such as the NSCC clearinghouse, it is vital that all mutual fund companies should be required to process their retirement plan trades through the same clearinghouse method required to be used by retirement plan administrators that are not mutual fund companies.”

ASPPA is a national organization of retirement plan professionals dedicated to the preservation and enhancement of the private pension system in the United States. ASPPA offers education and professional credentials for 401(k) administrators (QKA), actuaries (MSPA, FSPA), pension consultants (CPC), pension administrators (QPA), and other benefits professionals (APM). ASPPA’s over 5,000 members provide consulting and administrative support to over half of the private retirement plans in the country.