Offshore Outsourcing of Qualified Plan Admin

[mming]

We've been periodically contacted by overseas firms who offer qualified plan admin on U.S. plans and are considering talking to them. As it's been several years since this was last discussed, I'm curious as to what experiences other employee bfts administrators on this board have had with offshoring and whether the general opinion on this topic has moved one way or the other over the last five years.

[ETA Consulting LLC]

It depends on what is being outsourced. If it's a pure button pushing operation, then there may be some advantages. It will quickly become your nightmare when the skill requirement is higher.

Good Luck!

[Guest Offender]

On behalf of anyone whose current job is in the area of qualified plan administration, dear God, in this day and age please don't consider offshoring. I would hate to look back in 10 years and see this post as the beginning of the end for yet another American job set, as the work gets sent overseas.

Are you pro-America, or are you just another one of those business owners who are supposedly responsible for creating jobs in the U.S., but really just create jobs overseas, so that you can maintain your own income? :angry:

[John Feldt ERPA CPC QPA]

What legal recourse would you have if you find someone in [not the U.S.] has been stealing confidential data regarding the participants of your clients?

What court do you go to?

[masteff]

Basic rule of thumb: the more complex the topic, the less successful the offshoring.

What types of licensing and professional certifications do these providers hold? Able and competent are two different things.

Do they provide plan document services? If not, then how do you keep your plan document current and what will that cost?

Are they really retirement plan experts or merely paper shufflers? What types of questions does your current TPA answer that you'd instead have to pay an ERISA atty to answer?

And if you're merely chasing price, then you have a duty to compare prices from other US providers as well. Be sure you're comparing apples to apples in terms of what services each will provide. Between posters on this board and this website's vendor directory, you can find plenty of firms that would be willing to talk to you: http://benefitslink.com/vendors/Administrators/

[shERPA]

All good comments. But unfortunately many of our clients view our work as "paper shuffling". We know the complexity and the consequences of getting it wrong, but they don't, and in many cases it doesn't matter. IRS can audit only so many plans. The challenge to us is (1) how to present our services in a way that differentiates them from paper shuffling, and (2) how to convince prospective clients that they would be ill-served by a low cost paper shuffler?

I met and discussed offshoring with a representative of one of the offshore operations several years ago. No matter what question I asked, such as "do you have XXX's software?", "can you do trust accounting?", "can you generate electricity from nuclear cold fusion?" was answered with "no problem, we can do everything". Not very confidence inspiring.

[ETA Consulting LLC]

Not very confidence inspiring.

Benefitslink could really use a "like" button.