collective trusts

[fidu]

Is a fiduciary of a collective trust necessarily bound under ERISA?

[IRC401]

I'm curious as to what kind of activity the fiduciary is planning that would be inconsistent with ERISA yet acceptable under state fiduciary law.

[fidu]

not aware of any planned activity that would be relevant under either, just trying to get a handle on how collective trusts work really.

im semi familiar with qualified plans' funds, but not at all familiar with collective trusts. maybe you can give me a quick overview of what they are and how they work??

[Guest ebpcpa]

I just got back from the annual AICPA EBP conference in San Diego. In one session, "The Universe of Direct Filing Entities--Structure, Sponsorship, Reporting, Obligations and Misconceptions," speaker Stephen Sutton discussed CCTs. He defined a CCT as "...an investment vehicle, in the form of a trust, sponsored and maintanied by a bank or trust company. It is subject to federal banking law. It permits collective investment, on an undivided, unitized basis of plan assets of employee benefits sponsored by unrelated employers."

He indicated the CCT is similar in operation to a Master Trust--the only difference is a Master Trust is an investment vehicle for one or more related employers. Basically, a bank arranges for the assets of one or more unrelated plans to be pooled together for investment purposes. Banks generally only construct these arrangements for their larger plan clients.

I'm not sure about your fiduciary question. It seems to me these vehicles are regulated by applicable banking laws. If you want more info, I suggest you contact Stephen, an attorney, at Larson, Allen, Weishar & Co. LLP in Minnesota, I beleive. Unfortunately, I don't have his email address or other contact info. But he's real sharp and may have the answers you need. Good luck.