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Showing results for tags 'erisa 404(c)'.
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A § 401(k) retirement plan provides participant-directed investment (with daily instructions). The plan’s menu is filled with a broad range of diversified SEC-registered mutual funds. (Assume these are prudently selected, prudently disclosed, and meet all ERISA § 404(c) conditions.) Beyond those diversified investment alternatives, the menu for participant-directed investment includes an account that invests in the publicly-traded stock of an operating business. The account is 1% “cash” (to facilitate transactions) and 99% the stock. The stock is NOT employer securities. Assume the plan’s administrator furnishes to participants every securities-law report and other disclosure the stock’s issuer has filed. (The administrator sends these to participants’ work e-mail addresses and the plan’s website a few minutes after the document is filed with the SEC or the stock exchange.) Is it enough that a participant can decide for himself or herself to invest in (or avoid) this stock? Or must a fiduciary evaluate whether this stock account should remain an investment alternative? If there is such a duty, under what facts and circumstances would a fiduciary find that a participant no longer should have the choice?