SAS 70

[Guest ceholder]

We have a case involving a 401k plan asset "custodian" demanding documentation

that I feel only the plan "Trustee" is responsible for verifying.

The situation is that the Trustee submitted a request for payment to be made to the

spouse of a deceased plan participant. This request was submitted on the custodian's

distribution request form. This spouse was previously paid out the major portion of

the account by a prior custodian when this was a Money Purchase Account with no

trouble. The balance is some residual earnings.

The new custodian is taking the position that they cannot make the distribution

without being provided the deceased participant's beneficiary designation and death

certificate. They say they must have this documentation for their SAS 70 audit.

Please advise I can further argue this with the new custodian and how .

[E as in ERISA]

Making decisions about distributions of plan assets is a fiduciary function. Performing ministerial functions in regard to distributions is not. If they are going to start questioning the Trustee's directions and making decisions on their own, then they may now be a plan fiduciary with all the attendant liabilities (for both their own acts and those of co-fiduciaries). Are they trustee for other plans? So the procedures they are citing apply to those plans? Or do they have a SAS 70 auditor who doesn't know the difference between a trustee and custodian?