ASPPA

Senior Advisory Consulting Analyst
for Mercer in FL

Benefits Plan Manager/Account Executive (Taft-Hartley TPA)
for BeneSys Administrators in CA

Daily Valuation Specialist
for Benetech, Inc. in CA

Retirement Plan Administrator
for Tri-State Plan Administration, Inc. in OH

Plan Administrator
for Capital Retirement Plan Services in FL

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The Impact of HITECH on HIPAA Privacy and Security Compliance
Nationwide on December 17, 2012 presented by Thompson Interactive

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[Guidance Overview]

MAP-21: Oh, What a Relief It Is! ...Isn't It?
"If plans didn't opt out of the relief for pension administration purposes, their newly improved funded status could bring with it some administrative headaches. The key measurement of a plan's funded status is the adjusted funding target attainment percentage (AFTAP), and when the AFTAP goes below certain levels, different restrictions may kick in ... As plan funding has become worse over the last few years, many plans found themselves moving down the chart and implementing restrictions. Now, thanks to MAP-21, they may see themselves moving back up the chart and having to undo what they've done." (Retirement Town Hall)

[Advert.]

New! Plan Document Software Module

Wolters Kluwer Law & Business - ftwilliam.com has implemented lots of feedback and our own innovative ideas into a newly designed plan document software module. Join our webinar on December 6th for a sneak peek at our enhancements and what's coming.

[Guidance Overview]

Agencies Help Retirement Plans Respond to Hurricane Sandy
"Plan sponsors might wish to check the agency web pages devoted to Hurricane Sandy relief on a regular basis because the agencies have indicated that they will expand existing relief provisions and add additional relief as necessary. Also, all three agencies have invited those affected by Hurricane Sandy but not covered by any of the existing guidance to contact them directly to discuss individual relief on a case-by-case basis." (The Segal Group, Inc.)

December 11 IRS Phone Forum on Relief for Hurricane Sandy Victims
"Announcement 2012-44 and the relief it provides for those affected by Hurricane Sandy will be addressed by Eric Slack, Acting Manager of Employee Plans Technical Guidance. The forum will focus on the announcement and the options available to employees, their families and plan sponsors. Mr. Slack will be answering a number of common questions resulting from the issued announcement. If you have a specific matter that you would like to be addressed, please let [the IRS] know via email at ep.phoneforum@irs.gov on or before December 7, 2012." (Internal Revenue Service)

American Airlines Seeks Court Approval to Ground Lump-Sum Benefit Option
"Under one scenario outlined by AMR, a 50-year-old pilot, for example, 'may conclude that he or she can have the best of both worlds by retiring from American with a substantial lump sum while continuing to fly the most prestigious aircraft at a top salary for a foreign airline.' A surge in retirements 'would create a pilot shortage which, in turn, would result in an operational crisis involving the wholesale cancellation of flights and the grounding of airplanes, with a corresponding devastating reduction in revenue and profitability,' AMR said in its filing." (Pensions & Investments)

All or Nothing? An Expanded Perspective on Retirement Readiness (PDF)
"Approximately 44 percent of the Baby Boomer and Gen-Xer households are simulated to be at-risk of running short of money in retirement assuming they retire at age 65 and retain any net housing equity in retirement until other financial resources are depleted.... Nearly one-half (49.1 percent) of Gen Xers have at least 20 percent more than is simulated to be needed; approximately one-third (31.4 percent) have between 80-120 percent of the financial resources necessary to cover the retirement expenses and uninsured health care costs; and about 1 in 5 (19.4 percent) are projected to have less than 80 percent of what is needed." (EBRI)

[Advert.]

Increase the Profitability and Potential of Your Investment-Only Business

DCIO industry innovators, retirement platforms, advisors, and consultants provide insights and strategies to survive and thrive in the Defined Contribution Investment-Only market. Mention FMP164 during registration to receive a 10% discount.

The Real Reason Unions Are Targeting Wal-Mart: Pensions
"[T]he United Food and Commercial Workers International Union, which organized Black Friday's 'strikes' outside [Wal-Mart] stores, has a serious problem. Its pension funds are failing. Most are in critical status (defined as less than 65 percent funded) or in endangered status (less than 80 percent funded), according to the union's own reports to the U.S. Labor Department. Without an infusion of new cash, they will not be able to pay all their obligations to future retirees. That's why the UFCW seeks to sign up 1.4 million Wal-Mart employees -- to inject fresh money into its failing plans." (The Examiner)

Many National Pension Systems Will Be Stressed As Working Age Populations Shrink by 2020
"The economically vital 15-64 age group is set to drop by as much as 6% as a percentage of total population in some nations in the next eight years, highlighting the pressure on unfunded national pension systems ... Hong Kong faces the biggest decline in this age group from 76% of total population today to 70% in 2020. Canada, Japan and Russia are major economies in which the working age population as a percent of total population is expected to decline by 4%. China, the United Kingdom and the United States are expected to see a 2% decline." (Mercer)

How Plan Sponsors Select Advisers
"When asked what criteria they used to initially screen potential advisers, plan sponsors most often cited personal fit/sales process (60%), followed by pricing (53%) and experience/expertise (44%), with prior relationship (5%) least frequently cited. When selecting an adviser from among those considered as finalists, plan sponsors continued to most frequently cite personal fit/sales process (55%) as an attribute leading to their decision." (PLANSPONSOR.com)

Asia's Pension Plans Face Black Hole
"Governments in Asia have been caught ill-prepared by their rapidly aging populations as they struggle to provide adequate pension cover for the elderly. There is a yawning gap between what's currently in state pension coffers in Asia and what's needed to cover the elderly in retirement. And experts say if governments don't step up pension reforms, they risk a massive funding shortfall." (CNBC)

What Is the Efficient Frontier and Why Does It Matter for 401(k) Investors?
"For individual investors planning for retirement, the importance of this theory is not in the fancy words and charts, but rather the simple ideas behind them. Understanding your tolerance for risk and outlining your investment goals will help you to create the best possible diversified portfolio, which, in the long-run may lead you toward the most optimal gains, with hopefully, the least amount of pain." (Smart401k.com)

DrinkerBiddle ERISA Litigation Newsletter, November 2012 (PDF)
Articles in this issue include: (1) Ninth Circuit Holds That Equitable Defenses May Be Asserted by Participants to Rewrite and Defeat Plan Reimbursement Provisions; (2) Why It Is Necessary To Watch Over Your Service Providers; and (3) Undisclosed Fees in the Health Plan Setting, and the Potential Danger to Health Plan Sponsors. (Drinker Biddle)

Target-Date Funds and the Dispersion of Participant Portfolios
"[I]n the 2006-2011 period ... the typical participant earned a small but positive investment return ... However, returns were highly dispersed, with the difference between the 5th and 95th percentiles spanning some nine percentage points per year.... [R]isk and return outcomes for participants in professionally managed allocations were substantially less dispersed than for participants making their own choices.... [T]his reduction in dispersion of outcomes is attractive from the perspective of plan fiduciaries, as it demonstrates improved investment discipline in participant portfolios." (The Vanguard Group, Inc.)

CalPERS Statement About Suit to Enforce City of San Bernardino Pension Contributions
"Since commencing its bankruptcy case, the City of San Bernardino has failed to make payments of approximately $6.9 million to CalPERS. San Bernardino's payments to CalPERS are required by California law. A city may not operate under the protection of the bankruptcy court without paying its post-petition bills and without complying with State laws, including those governing employee compensation and the State retirement system. Under the provisions of chapter 9 of the bankruptcy code, the bankruptcy court does not have the ability to directly order the City to pay its bills. Such an order may only be issued by a state court." (California Public Employees' Retirement System)

Private Equity Fund Is Not a 'Trade or Business' Under ERISA
"In a significant ruling that directly refutes a controversial 2007 opinion by the Pension Benefit Guaranty Corporation (PBGC) Appeals Board, the U.S. District Court for the District of Massachusetts held ... that a private equity fund is not a 'trade or business' under [ERISA] and therefore is not jointly and severally liable for millions of dollars in pension withdrawal liability incurred by a portfolio company in which the private equity fund had a substantial investment. This ruling, if followed by other courts, will provide considerable clarity and relief to private equity funds that carefully structure their portfolios." [Sun Capital Partners III, LP v. New England Teamsters & Trucking Indus. Pension Fund, No. 10-10921-DPW, 2012 WL 5197117 (D. Mass. Oct. 18, 2012)] (Bender's California Labor and Employment Bulletin)

Public Sector Retirement Plans Helped by IRS Relief for Hurricane Sandy Victims
"It is important to note that Announcement 2012-44 does not change the maximum amount available for a hardship distribution under the plan under the IRC or related regulations or the statutory limits for loans, nor does it change the tax consequences of a hardship distribution or loan." (The Segal Group, Inc.)

Fiduciary Liability for Diverted Employee Health and 401(k) Contributions Can't Be Erased in Personal Bankruptcy
"[T]he U.S. Bankruptcy Court for the Northern District of Illinois said the president and part-owner of several related companies whose plans he managed could not discharge, through his personal bankruptcy case, his liability in unremitted employee contributions to retirement and group health plans governed by ERISA. His liability amounted to more than $67,000." [In re John Dombek III, No. 11-40894 (Bankr. N.D. Ill. Oct. 16, 2012); In re John Dombek Jr., No. 12-00564 (Bankr. N.D. Ill. Oct. 5, 2012)] (Thompson SmartHR Manager)

Retirement Plan Not Required to Reimburse Participant for Fraudulent Withdrawal by Ex-Spouse
"[T]he 10th U.S. Circuit of Appeals [recently] upheld a [District Court] decision ... that the plaintiff's right to his plan benefits was not forfeited in violation of ERISA when his ex-wife gained access to his retirement account and withdrew all the funds. The appellate court further concluded that the plan should not reimburse [the employee's] plan account for the amount disbursed fraudulently to ... his ex-wife." [Foster v. PPG Industries Inc. (No. 10-5123, 10th Cir Sept. 5, 2012)] (Thompson SmartHR Manager)

[Opinion]

When CalPERS Meets Greece?
"[If CalPERS] manage[s] to secure pension payments ahead of unsecured bondholders, it could potentially rock the municipal bond market, making it more expensive for cities to borrow money. But if CalPERS loses this case, it opens up a Pandora's box as other municipalities will follow San Bernardino and suspend their pension payments. If that happens, CalPERS will have to make difficult choices, like drop or terminate city pensions. This isn't in anyone's best interest." (Pension Pulse)

[Opinion]

Defined Benefit Pension Plans: A Six-Point Plan to Address the Accelerated Exodus (PDF)
"[This] plan raises tens of billions of dollars of revenue, and the plan helps create jobs by preventing unnecessary diversion of critical company assets and by stimulating business expansion. (1) Funding stabilization needs to be made permanent. (2) Accounting standards need to be stabilized. (3) PBGC premiums need to be based on stable long-term assessments of need. (4) Businesses should not be prevented from engaging in helpful transactions by PBGC. (5) We need to continue working with Congress, Treasury and the IRS to present testing rules from encouraging pension plan closures. (6) Workable rules for hybrid pension plans are critical." (American Benefits Council)

[Guidance Overview]

ISS Issues Final 2013 Proxy Voting Policies
"ISS's current policy is to vote on a case-by-case basis on proposals to approve golden parachute compensation, consistent with its policies on problematic pay practices related to severance. The ISS final 2013 policy eliminates the previous 'grandfather' status of existing change-in-control arrangements with named officers.... ISS originally proposed adding hedging and pledging as an additional problematic pay practice under its pay-for-performance analysis. However, based on comments received, ISS determined that the negative vote recommendation should be directed toward election of directors rather than a company say-on-pay proposal." (Wilson Sonsini Goodrich & Rosati)

Most Consumers Lack Confidence in Ability to Pay Costs of Long-Term Care
"[M]ost consumers lack confidence in covering their long-term care costs in retirement and ... already low confidence levels appear to diminish further with age. While only 28 percent of Generation Xers are confident in meeting long-term care costs, that level of optimism declines to 24 percent among Baby Boomers. The trend of decreasing confidence with age was detected across all demographics surveyed, including gender, income and marital status." (Insured Retirement Institute)

Health Care Costs Are Largest Retirement Worry for Investors
"The top retirement concerns among investors aged 21-50 are health care costs (76%), rising taxes (67%), Social Security availability (63%), inflation (61%), long-term care (58%), living too long and running out of money (52%), and housing values (52%). Only 16% of investors expect to receive full Social Security benefits as currently promised. The remaining 84% expect to receive no Social Security benefits (36%) or some form of reduced benefits when they retire (48%)." (TD Ameritrade via InsuranceNewsNet)

New Interactive Tools Help Consumers and Businesses Assess Protection Levels
Aflac

Sean Ganoe Joins Henderson Brothers Employee Benefits Division as Assistant Vice President
Henderson Brothers, Inc.

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