What do you do when...?

[Guest ggbrock]

A client comes to you and tells you that it has a "frozen 401(a) plan" that the employer used to contribute to (for over 10 years), stopped contributing a few years ago (which is why they consider it "frozen"), that they have no documents for the Plan and want to "get rid of it". No employee contributions were ever accepted to the Plan, accd to the client. Mind you, the provider/trustee holding the money with respect to this plan claims no knowledge of any plan document of any sort, and simply confirms that is a "401(a) plan". No one is certain whether 5500s were filed, or if they were filed properly.

Now, I know we have to have further discussions with the trustee, as I cannot believe that they can dissafirm any knowledge whatsoever about this plan other than the fact they have the money and it is a "401(a) plan".

So... assuming it is in fact true that the trustee has no other information, is there ANY advice to give this client either than "You should present this to the government and beg for relief?" (Which is the only thing that immediately comes to mind as a plausible solution). It goes without saying that client will certainly not want to do that, and would like to simply do away with it as quickly as possible.

[david rigby]

Have you considered running the other way?

[Guest ggbrock]

Have you considered running the other way?

Ha-ha. YES. :-) In fact, part of me thinks that might be the only feasible "solution".

[J Simmons]

This client gives off all the signals of someone that will not pay you for taking the steps necessary to fix this situation and "get rid of it". Get a retainer up front for at least 200% of what you think your fees would be, and make sure your engagement letter disclaims any result.