"Under the proposed rules , in addition to disclosure and operational requirements, [auto-portability providers (APPs)] would need to acknowledge their fiduciary status in writing and would be subject to fiduciary duties. Unlike the existing rules for safe harbor IRAs, the proposed rules provide no fiduciary safe harbor for rollovers to a new employer's plan by an APP.... Moreover, according to the DOL, the decision of an employer to participate in an APP program would constitute a fiduciary act."   MORE >>

"[W]ith this new package DOL believes it has addressed the concerns articulated by the Fifth Circuit in a way that advances the DOL’s concerns about the harm suffered by those who receive conflicted advice. If the DOL’s rule stands, going forward, a new somewhat nuanced paradigm will prevail and, in many instances, financial salespeople and insurance agents will be held to a relationship of trust and confidence with their retirement investor customers[.]"   MORE >>

"Legal experts with varying perspectives on the rule agree that the DOL likely does not have authority to apply fiduciary duties under Title I of [ERISA] to individual retirement accounts [IRAs].... Kendra Isaacson ... former Senate pension policy director for Senator Patty Murray ... says, 'the IRA is a creature of the [Internal Revenue] Code,' and under the authority of the Treasury Department. She adds, 'If DOL wanted to cover these rollovers, it should have been a joint rulemaking.' "   MORE >>

"Employers who have adopted a pre-approved Pension Plan -- either traditional Defined Benefit or Cash Balance -- must restate their plans by March 31, 2025 ... It is the responsibility of the Plan fiduciary to ensure that the Plan is updated and signed by the March 31, 2025 deadline. Because the Restatement process can be time consuming, it is important to begin Planning to ensure the Restatement deadline is met. And as mentioned above, it's now a compliance question on Form 5500."   MORE >>

"The decision is notable for articulating the level of detail that may be sufficient in the Fifth Circuit for these kinds of claims to survive a motion to dismiss.... With respect to the recordkeeping fee claim, the Fifth Circuit's requirement that plaintiffs plead that similarly-sized plans received similar services for lower fees is consistent with the standard set in other jurisdictions. " [ Perkins v. United Surgical Partners International, Inc. , No. 23-10375 (5th Cir. Apr. 11, 2024; unpub.)]   MORE >>

"Low-cost index funds hit Fidelity's revenue, prompting a focus on more profitable products like managed money, the advisor's suit claims. The suit says advisors were pressured to sell higher-revenue products even when they were not in clients' best interest." [Maeker v. Fidelity Investments, No. 24-1078 (N.D. Tex. complaint filed May 6, 2024)]   MORE >>

"International Pension Plans (IPPs) and International Savings Plans (ISPs) are used by multinational employers to provide retirement or savings benefits.... 142 IPPs and ISPs were established over the last five years, with the highest concentration in banking and finance accounting for some 15% of these plans. Other sectors attracting significant interest include oil and gas (12%), non-profit organizations (11%) and engineering and power (11%). Most are described as global (Figure 1), accommodating members from diverse geographies and nationalities"   MORE >>

"Did you just set your plan up last year? Sorry, you still gotta jump through the hoop; see if you can catch a break from your TPA to get it restated on the cheap if you don't change anything. Were you going to terminate your plan, anyway, and are thinking 'now's the time' since you're tired of the administrative expense? Sorry again; every ERISA attorney ... will recommend you restate your plan before you terminate it."   MORE >>

"[A]lmost two-thirds (65.1%) of states have vesting requirements that would violate the minimum vesting rules of ERISA for private sector plans.... Longer vesting means nearly half of workers who choose to work for public-sector employees will only be paid about 87% of their total compensation package. They will forfeit the rest.... Individual account plan designs, including defined contribution and cash balance plans, avoid the fundamental problems of traditional DB plans by allowing full portability of benefits, protection against inflation, and more uniform benefit accruals."   MORE >>

"The problem with [the Sellers reasoning] is that it treats fiduciary prudence as infinite, as something that can always be challenged in court as having been insufficient no matter how much was done ... At some point, a fiduciary has engaged in more than enough prudence to satisfy the statutory obligation ... [T]here is always more that could be done, but that alone shouldn't preclude finding that a fiduciary did, in fact, enough." [ Sellers v. Trustees of Boston College , No. 22-10912 (D. Mass Apr. 11, 2024)]   MORE >>

"Though the FTC argues [that] the agency charged with regulating 'competition' can regulate 'non-competition' agreements, the legal challenge will be more complicated. The Commission will be pressed to defend the lack of specific delegation of authority under Section 5 of the FTC Act by Congress to regulate contracts historically governed by state law. Indeed, two of the commissioners voted against adopting the final rule for this reason."   MORE >>