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Fiduciary Governance
Noting that “precedent has overtaken some of the debates in the case,” a federal appellate court has weighed in on an excessive fee case—affirming the rejection of most, but not all, of the plaintiffs’ claims.
The Case
The defendants in this case are the fiduciaries of Cincinnati-based...
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Eleanor Shellstrop has operated her fledgling business, The Good Place, for about seven years now. She established a 401(k) Profit Sharing Plan somewhere around Year 2 at the recommendation of her CPA. The CPA set up the plan for her with a bundled service provider. Whatever the CPA put on the...
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An ex-participant whose 401(k) account was drained of some $750,000 by a “fraudster” has filed suit against the plan fiduciaries, the recordkeeper and the trustee for alleged breaches of fiduciary duty in not preventing the theft.
The participant-plaintiff here is one Paula Disberry, who worked...
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Continuing their two-decade decline, the average expense ratio paid by fund investors fell again last year, Morningstar’s annual U.S. Fund Fee Study reports.
The study, which evaluates trends in the cost of U.S. open-end mutual funds and exchange-traded funds (ETFs), found that the asset-...
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A federal appellate court has backed the dismissal of an excessive fee suit, rejecting the notion that offering actively managed funds—even those with disappointing performance—by itself doesn’t support allegations of a fiduciary breach.
Interestingly enough, it’s the first such appellate court...
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Broker-dealers and advisors doing business in the Silver State will want to pay attention to newly proposed regulations defining the state’s fiduciary standard, as well as broader changes to practices and procedures.
Efforts by Nevada regulators to implement guidance defining the state’s...
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The Pension Benefit Guaranty Corporation (PBGC) and the IRS on July 7 issued fresh guidance on special financial assistance (SFA) applications.
More specifically, the PBGC issued a final rule setting forth the requirements for SFA applications and related restrictions and conditions in accordance...
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The Labor Department is pushing back against litigation challenging specific elements of its FAQs regarding the fiduciary rule.
The suit (Am. Sec. Ass’n v. U.S. Dep’t of Labor, M.D. Fla., No. 8:22-cv-00330, complaint filed 2/9/22) was one of two filed earlier this year challenging the DOL’s...
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There’s a battle brewing in Battle Creek about excessive recordkeeping and managed account fees.
Bradley H. Fleming, a former accountant at Kellogg’s, has sued his former employer, the Kellogg Co., its board of directors, its ERIA finance committee and its ERISA administrative committee claiming...
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A federal appellate court has backed the dismissal of an excessive fee suit, rejecting the notion that offering actively managed funds—even those with disappointing performance—by itself doesn’t support allegations of a fiduciary breach.
Interestingly enough, it’s the first such appellate court...
READ MORE
A federal judge has ruled that the comparisons put forth as proof of a fiduciary breach were not “meaningful.”
The suit was filed late last year by plaintiff-participants Malika Riley and Takeeya S. Reliford, by and through their attorneys—Carey & Danis, Edelson Lechtzin LLP, and, Capozzi...
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A key House Republican has released a discussion draft of financial data privacy legislation that could impact how retirement plan providers and administrators collect and share consumers’ personal information.
Rep. Patrick McHenry (R-NC), who serves as the top Republican on the House Financial...
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Based on updates to the Department of Labor’s Spring 2022 regulatory agenda, it appears that stakeholders will have to wait a little longer for the agency’s revisions to the definition of fiduciary, as well as final guidance on ESG-based factors and additional Form 5500 changes.
Fiduciary Rewrite...
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Eleanor Shellstrop has operated her fledgling business, The Good Place, for about seven years now. She established a 401(k) Profit Sharing Plan somewhere around Year 2 at the recommendation of her CPA. The CPA set up the plan for her with a bundled service provider. Whatever the CPA put on the...
READ MORE
A federal judge has dismissed an excessive fee suit involving a $7.8 billion 401(k) plan, accepting the argument that the participant-plaintiff wasn’t even invested in the funds in question.
Mind you, as we’ve noted previously, the legal standard to survive a motion by defendants to dismiss a suit...
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A federal judge has questioned the wording in a $7 million excessive fee settlement agreement.
The suit—filed way back on Valentine’s Day, 2017—involved allegations by a participant in its own plan (and funds), one David G. Feinberg, on behalf of the T. Rowe Price U.S. Retirement Program and all “...
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Retirement plans have garnered heightened scrutiny. And that, suggests a recent blog entry, highlights the importance of fulfilling fiduciary duties and not committing a fiduciary breach.
The IRS and DOL have increased the number of plans they audit, note Justin M. Pisellini, President, and Joel...
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A recent blog entry provides some insight about what plan committees are looking for and how they evaluate service providers.
Plan sponsors have “tremendous responsibility” as stewards of DC plan assets, writes Mark Olsen, Managing Director at PlanPILOT in their blog. Not only are they meeting...
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Editor’s note: This is the second in a two-part series. The first installment appeared here.
In my last column, I argued that when ERISA diversification requirements are met, the only remaining prudence issue is price and that, regarding an asset (e.g., stock in a company) that is traded in a...
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How much injury do you need to suffer in order to bring an excessive fee suit?
That issue arose in one of a half-dozen cases that had been frozen in place last fall pending the U.S. Supreme Court’s decision in Hughes v. Northwestern University, decided this past January.
The case at hand was...
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