35 Million Reasons to Monitor 401(k) Plan Fees
April 12th, 2012 by JBWK
Highlighting the seriousness of ERISA’s fiduciary obligations regarding service-provider fees for retirement plans, a federal court has held an employer’s 401(k) plan fiduciaries liable for $35 million.
The fiduciaries of manufacturer ABB, Inc.’s 401(k) plans failed to monitor service providers fees, failed to properly deliberate over switching mutual funds, and failed to properly control the plan’s investment costs. All plan fiduciaries have an obligation to ensure the plan pays only reasonable fees to service providers.
As we noted here, new Department of Labor rules governing fee disclosures become effective this year, which may precipitate a new wave of similar cases.
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