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Best Practices for Plan Sponsors #5

Posted on November 7, 2018, by Fred Reish in 401(k), 403(b), best practices, DOL Activity, fiduciary. Comments Off on Best Practices for Plan Sponsors #5

Fiduciary Training: The Need for Basics

I am writing two series of articles that together are called “The Bests.” One is about Best Practices for plan sponsors, while the other is about the Best Interest Standard of Care for advisors. Each series is numbered separately to make it easier to identify the subject that is most relevant to you.

This is the fifth of the series about Best Practices for Plan Sponsors.

In three earlier posts—Best Practices for Plan Sponsors #2, #3, and #4—about the Sacerdote v. New York University decision, I discussed the good and the bad of the NYU plan committee and made several suggestions about best practices for improving committee performance. This article focuses on one of those suggestions—fiduciary education for committee members.

As a starting point, there is not a legal requirement that committee members receive fiduciary training. Instead, it’s … Read More »

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Best Interest Standard of Care for Advisors #3

Posted on October 30, 2018, by Fred Reish in 401(k), 403(b), best interest, DOL Activity, Reg BI, Registered Investment Advisers, RIA, SEC. Comments Off on Best Interest Standard of Care for Advisors #3

SEC Best Interests . . . When? And What About the DOL

I am writing two series of articles that together are called “The Bests.” One is about Best Practices for plan sponsors, while the other is about the Best Interest Standard of Care for advisors. Each series is numbered separately to make it easier to identify the subject that is most relevant to you.

This is the third of the series about the Best Interest Standard of Care.

The Regulatory Agendas for the SEC and DOL were recently issued. Both have plans for guidance by September of 2019, but the anticipated timing of the guidance has, by and large, been misinterpreted. To understand what I mean, read on.

The SEC’s Agenda said that Final Action on the Regulation Best Interest proposal for broker-dealers and the Interpretation of Standard of Conduct for investment advisers … Read More »

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Best Practices for Plan Sponsors #4

Posted on October 17, 2018, by Fred Reish in best practices, fiduciary, Plan Sponsors, prudent, Service Providers. Comments Off on Best Practices for Plan Sponsors #4

What is the Baseline for A Committee to Act in the Best Interest of its Participants? (Part 3)

I am writing two series of articles that together are called “The Bests.” One is about Best Practices for plan sponsors, while the other is about the Best Interest Standard of Care for advisors. Each series is numbered separately to make it easier to identify the subject that is most relevant to you.

This is the fourth of the series about Best Practices for Plan Sponsors.

 In my last two posts (Best Practices for Plan Sponsors #2 and Best Practices for Plan Sponsors #3), I discuss the NYU case and the “bad” and “good” behavior of committee members. I concluded my last post with the point that process matters. Of course, it was unspoken that I was referring to a good process. This article discusses … Read More »

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Best Practices for Plan Sponsors #3

Posted on October 11, 2018, by Fred Reish in 401(k), 403(b), best practices, Plan Sponsors, prudent, Service Providers. Comments Off on Best Practices for Plan Sponsors #3

What is the Baseline for A Committee to Act in the Best Interest of Its Participants? (Part 2)

I am writing two series of articles that together are called “The Bests.” One is about Best Practices for plan sponsors, while the other is about the Best Interest Standard of Care for advisors. Each series is numbered separately to make it easier to identify the subject that is most relevant to you.

This is the third of the series about Best Practices for Plan Sponsors.

This is my second article about the case of Sacerdote v. New York University. As I discussed in my last post, the Court’s opinion pointed out the deficiencies in the understandings and conduct of some committee members. However, the Court ultimately ruled in favor of the plan fiduciaries and against the plaintiffs. Why was that?

Despite the deficiencies (or “bad … Read More »

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TPAs as Fiduciaries . . . of Their Own Plans

Posted on October 8, 2018, by Fred Reish in TPA. Comments Off on TPAs as Fiduciaries . . . of Their Own Plans

Heather Abrigo and I have begun writing articles for third party administrators, TPAs.  This first article is about issues arising from a TPA’s own plan, where it is, by definition, a fiduciary.  If you are interested in receiving future TPA articles, email liz.jutila@dbr.com.

 

 

 

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Best Practices for Plan Sponsors #2

Posted on October 3, 2018, by Fred Reish in 401(k), 403(b), best practices, fiduciary. Comments Off on Best Practices for Plan Sponsors #2

What is the Baseline for A Committee to Act in the Best Interest of Its Participants? (Part 1)

I am writing two series of articles that together are called “The Bests.” One is about Best Practices for plan sponsors, while the other is about the Best Interest Standard of Care for advisors. Each series is numbered separately to make it easier to identify the subject that is most relevant to you.

This is the second of the series about Best Practices for Plan Sponsors.

The recent decision in the case of Sacerdote v. New York University is a classic story of the good and bad of plan committees. Let’s start with the bad.

Five current and former committee members testified at the trial. But not all of the testimony was helpful.

In the opinion, the Court said that the testimony of one of the co-chairs “was … Read More »

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Best Practices for Plan Sponsors #1

Posted on September 26, 2018, by Fred Reish in 401(k), 403(b), best practices, Plan Sponsors, Service Providers. Comments Off on Best Practices for Plan Sponsors #1

Best Practices for Plan Sponsors: Projection of Retirement Income

I am writing two series of articles that together are called “The Bests.” One is about Best Practices for plan sponsors, while the other is about the Best Interest Standard of Care for advisors. Each series is numbered separately to make it easier to identify the subject that is most relevant to you.

This is the first of the series about Best Practices for Plan Sponsors.

“Best Practice” is above and beyond the legal requirements. Best Practices are not mandated; they are elected.

While the most obvious Best Practices are automatic enrollment and automatic deferral increases, I want to start with the projection of retirement income for participants. That’s partially because it is in a current legislative proposal—in the Retirement Enhancement and Savings Act (RESA), and also because, in my opinion, it doesn’t receive … Read More »

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Best Interest Standard of Care for Advisors #2

Posted on September 19, 2018, by Fred Reish in best interest, DOL Activity, FINRA, prudent, Reg BI, SEC. Comments Off on Best Interest Standard of Care for Advisors #2

I am writing two series of articles that together are called “The Bests.” One is about Best Practices for plan sponsors, while the other is about the Best Interest Standard of Care for advisors. Each series is numbered separately to make it easier to identify the subject that is most relevant to you.

This is the second of the series about the Best Interest Standard of Care.

In my last post, I discuss the remarkable similarities among the SEC’s proposed Regulation Best Interest, the SEC’s proposed Interpretation for investment advisors, the DOL’s Best Interest standard of care (which is a combination of ERISA’s prudent man rule and duty of loyalty), and the New York State Best Interest standard for sales of annuities and insurance products. All of those rules require that advisors act with care, skill, prudence and diligence, and that they place … Read More »

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Best Interest Standard of Care for Advisors #1

Posted on September 12, 2018, by Fred Reish in best interest, BICE, prudent, SEC. Comments Off on Best Interest Standard of Care for Advisors #1

What is the Best Interest Standard of Care?

I am writing two series of articles that together are called “The Bests.” One is about Best Practices for plan sponsors, while the other is about the Best Interest Standard of Care for advisors. Each series is numbered separately to make it easier to identify the subject that is most relevant to you.

This is the first of the series about the Best Interest Standard of Care.

For this inaugural article, let’s talk about the meaning of “Best Interest.”

There are at least four Best Interest standards. (While “best interest” can also refer to management of conflicts of interest, this article is about the best interest standard of care.)

ERISA’s best interest standard of care for plan sponsors and fiduciary advisors for private sector retirement plans. (While ERISA doesn’t literally have a best interest standard—because the Best … Read More »

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Hearing on Retirement Income by the ERISA Advisory Council

Posted on August 22, 2018, by Fred Reish in DOL Activity. Comments Off on Hearing on Retirement Income by the ERISA Advisory Council

I recently testified before the Department of Labor’s ERISA Advisory Council on the subject of lifetime income. More specifically, it was about lifetime income products and services for retirees provided through defined contribution plans. Here are my opening comments:

Thank you for this opportunity to testify.

I am Fred Reish, a partner in the law firm of Drinker, Biddle and Reath. However, this testimony is not on behalf of the firm, but instead represents the views of my partner, Bruce Ashton, and myself.

As a starting point, it is helpful to have a foundation for development of recommendations. For example, I suggest:

The conversation about defined contribution plans needs to increasingly and emphatically include retirement income.
Plan sponsors and participants need good quality, reasonably priced retirement income products and services.
Plan sponsors need clear, objective and implementable guidance on how to do that.
Participants need information, education … Read More »

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