A recent flurry of lawsuits has "targeted" holders of the BlackRock LifePath target-date funds and their decision(s) to select, and hold, on their investment menu.  Ironically, the plan fiduciaries have been charged with "chasing low fees" with a disregard for the funds' performance - which the plaintiffs say was tracked against an inappropriate benchmark.  In this episode, Nevin & Fred look at the issues raised by - and the issues involved in - this new round of ERISA litigation.

Episode Resources

Home Depot Hammers Back Excessive Fee Suit https://www.napa-net.org/news-info/daily-news/home-depot-hammers-back-excessive-fee-suit

ARA Joins Amicus Brief Rebuffing BlackRock TDF Suit  https://www.napa-net.org/news-info/daily-news/ara-joins-amicus-brief-rebuffing-blackrock-tdf-suit

‘Damned’ (Even) If You Do https://www.napa-net.org/news-info/daily-news/damned-even-if-you-do

Shah Miller Targets (Yet) Another 401(k) with BlackRock TDF  https://www.napa-net.org/news-info/daily-news/shah-miller-targets-yet-another-401k-blackrock-tdf

There’s an old saying that when you assume… well, that applies double (and then some) to ERISA plan fiduciaries.  In this episode, Nevin (Adams) and Fred (Reish) discuss five – with reminders about how to avoid winding up in trouble.

Episode Resources

https://www.napa-net.org/news-info/daily-news/5-dangerous-fiduciary-assumptions

https://www.napa-net.org/news-info/daily-news/5-things-your-plan-committee-members-need-know

https://www.napa-net.org/news-info/daily-news/5-plan-committee-missteps

With the written best interest documentation requirement now in place (as of July 1), and with some evidence that some advisors might not have focused on that deadline (or a series of others that took effect in February), in this episode Nevin (Adams) & Fred (Reish) look at some new ways to “fix” non-compliance issues.

Episode Resources

Best Interest Standard of Care for Advisors #93: Correction of Failures to Satisfy PTE 2020-02  https://fredreish.com/best-interest-standard-of-care-for-advisors-93/

IRS Pilots Pre-examination Retirement Plan Compliance Program  https://www.asppa-net.org/news/irs-pilots-pre-examination-retirement-plan-compliance-program

Morningstar Urges DOL to Revisit TDF Guidance  https://www.napa-net.org/news-info/daily-news/morningstar-urges-dol-revisit-tdf-guidance

There’s a lot going on in Washington – big movements in the Senate and in the House – and bipartisan.  So, what’s in those bills?  Nevin (Adams) and Fred (Reish) take a look.

Episode Resources

The Path(s) of Least Resistance  https://www.napa-net.org/news-info/daily-news/paths-least-resistance

Bipartisan Bill Backs Auto-Portability  https://www.napa-net.org/news-info/daily-news/bipartisan-bill-backs-auto-portability

It’s Unanimous! EARN Passed by Senate Committee 28-0  https://www.napa-net.org/news-info/daily-news/its-unanimous-earn-passed-senate-committee-28-0

Senate HELP Committee Approves RISE & SHINE Act  https://www.napa-net.org/news-info/daily-news/senate-help-committee-approves-rise-shine-act

House Advances SECURE 2.0 in Nearly Unanimous Vote  https://www.napa-net.org/news-info/daily-news/house-advances-secure-20-nearly-unanimous-vote

The Labor Department’s expanded definition of fiduciary advice is described in the preamble to PTE 2020-02. The PTE then provides relief for conflicted non-discretionary recommendations (for example, rollover recommendations), IF its conditions are satisfied.

In this episode Nevin & Fred discuss the new parameters, how they’re applied, the conditions that might (and might not) be sufficient to warrant rolling money out of a qualified plan and into an IRA – and the “new” requirement that the justification as to why that move is in the interests of the plan participant – and be in writing, effective July 1.

Episode Resources

Best Interest Standard of Care for Advisors #92: Consideration of Costs in the Evaluation of Rollovers: https://fredreish.com/best-interest-standard-of-care-for-advisors-92/

Best Interest Standard of Care for Advisors #89: Rollovers and the Information That Is Needed About the Participant: https://fredreish.com/best-interest-standard-of-care-for-advisors-89/

Best Interest Standard of Care for Advisors #84: Compliance with PTE 2020-02: Special Issues: Monitoring: https://fredreish.com/best-interest-standard-of-care-for-advisors-84/

DOL Official Sheds Light on Rollover Recommendations: https://www.napa-net.org/news-info/daily-news/dol-official-sheds-light-rollover-recommendations

Rollovers, Regular Basis Focus of DOL Guidance: https://www.napa-net.org/news-info/daily-news/rollovers-regular-basis-focus-dol-guidance

DOL Delays Enforcement of Fiduciary Investment Advice Exemption: https://www.napa-net.org/news-info/daily-news/dol-delays-enforcement-fiduciary-investment-advice-exemption-0

When it comes to workplace retirement plans, there are three kinds of people: people who are ERISA fiduciaries and know it, people who aren’t ERISA fiduciaries and know it, and people who are ERISA fiduciaries and don’t know it.

If you’re in the first or last category — well, in this episode Nevin & Fred discuss seven things that every ERISA plan fiduciary should know.

Episode Resources

https://www.napa-net.org/news-info/daily-news/7-things-every-erisa-fiduciary-should-know

In Part 2 of their “live” podcast from the NAPA 401(k) Summit, Nevin & Fred discuss ESG (and “material risk and return factors”), tie-breakers, designated investment alternatives, “extreme caution” & cryptocurrency within self-directed brokerage accounts (and beyond) – and Fred’s favorite ERISA case…

Episode Resources

DOL Issues Big Caution on Crypto  https://www.napa-net.org/news-info/daily-news/dol-issues-big-caution-crypto

A Thumb on the Scale(s)?  https://www.napa-net.org/news-info/daily-news/thumb-scales

Cold Water Thrown on Need for New Brokerage Window Guidance  https://www.napa-net.org/news-info/daily-news/%E2%80%8Bcold-water-thrown-need-new-brokerage-window-guidance

Fred’s favorite case: https://www.napa-net.org/news-info/daily-news/nyu-excessive-fee-suit-gets-failing-grade

Fred’s fiduciary training powerpoint slides about Fred’s favorite case: https://img1.wsimg.com/blobby/go/f197dd2b-b8f0-4392-acf5-dfc33e2bd3c2/Fred%20Fiduciary%20Training.pdf 

Nevin’s column about Fred’s favorite case:  Expert Opinions https://www.napa-net.org/news-info/daily-news/expert-opinions

Nevin & Fred take their podcasting on the road for a Live session at the 2022 NAPA 401(k) Summit!

Episode Resources

SCOTUS Gives Excessive Fee Suit Plaintiffs Another Shot: https://www.napa-net.org/news-info/daily-news/scotus-gives-excessive-fee-suit-plaintiffs-another-shot

Hughes v. Northwestern University et al., case number 19-1401, in the Supreme Court of the United States: https://www.napa-net.org/sites/napa-net.org/files/19-1401_m6io.pdf

SCOTUS Ponders Excessive Fee Case: https://www.napa-net.org/news-info/daily-news/scotus-ponders-excessive-fee-case

Nevin's Column that was cited by the DOL:  https://plansponsorinstitute.blogspot.com/2009/02/winning-ways.html

Nevin's Column about being cited by the DOL (because, why not?):  https://plansponsorinstitute.blogspot.com/2009/04/second-opinion.html

Fred's article in PLANSPONSOR (edited by Nevin) cited by the Schlichter Bogard & Denton-backed plaintiffs in the original Hughes case (page 23):  https://www.napa-net.org/sites/napa-net.org/files/uploads/Divane-v.-Northwestern.pdf

A hot topic of conversation of late has been crypto currency – and just as it seemed to be making some inroads on some 401(k) platforms, the Labor Department jumped in with something called a Compliance Assistance Release that should certainly give pause to plan fiduciaries.  That follows a bit of a clarification on a stance it issued on the appropriateness of private equity in defined contribution plans in 2020 which, in turn follows a new proposal on ESG, and some commentary on self-directed brokerage accounts (SDBAs).

All that means that there is the potential for a bit of “flux” with regard to some non-traditional DC plan investments.  In this episode Nevin & Fred bat around the issues, the alternatives, and the potential consequences for plan fiduciaries!

DOL Issues Big Caution on Crypto https://www.napa-net.org/news-info/daily-news/dol-issues-big-caution-crypto

DOL Gives Green Light to Private Equity in TDFs  https://www.napa-net.org/news-info/daily-news/dol-gives-green-light-private-equity-tdfs

DOL Clarifies Guidance on Private Equity in 401(k) Plans  https://www.napa-net.org/news-info/daily-news/dol-clarifies-guidance-private-equity-401k-plans

Is There a Case for Alts in DC Plans?  https://www.napa-net.org/news-info/daily-news/there-case-alts-dc-plans

In their first episode of 2022, Nevin & Fred look at a new Supreme Court ruling likely to make it harder—perhaps much harder—to dismiss excessive fee lawsuits, the U.S. Supreme Court has remanded for further consideration a lower court decision that the law firm of Schlichter Bogard & Denton had argued had a “chilling effect” on excessive fee litigation.

What happens next?  Check it out...

Episode Resources

SCOTUS Gives Excessive Fee Suit Plaintiffs Another Shot: https://www.napa-net.org/news-info/daily-news/scotus-gives-excessive-fee-suit-plaintiffs-another-shot

Hughes v. Northwestern University et al., case number 19-1401, in the Supreme Court of the United States: https://www.napa-net.org/sites/napa-net.org/files/19-1401_m6io.pdf

SCOTUS Ponders Excessive Fee Case: https://www.napa-net.org/news-info/daily-news/scotus-ponders-excessive-fee-case

Summary of oral arguments: https://www.napa-net.org/sites/napa-net.org/files/scotus%20arguments%20summary.pdf

Transcript of oral arguments: https://www.napa-net.org/sites/napa-net.org/files/SCOTUS%20arguments.pdf