Late funding of participant contributions

[Nassau]

One of my clients received a letter from the DOL regarding late funding of participant contributions for 2008, 2009 and 2010. The plan is currently inactive, as all balances were distributed in the fall of 2011, including the forfeiture account. At this point, I believe the only outstanding item was for them to file the final 5500, which the recordkeeper and trustee doesn't even prepare.

What should we (recordkeeper/trustee) tell the client on how this situtaion should be handled?

[Peter Gulia]

The usual suggestion to the employer is to lawyer-up.

If there is any trustee other than the employer or its people, consider also that even a fully directed trustee should (separately) lawyer-up. Even if the trust agreement and all other plan and trust documents, taken together, state consistently a perfect allocation of the duty to collect contributions to a fiduciary other than the trustee, even a fiduciary with a very narrow scope can't entirely stay out of responsibility because ERISA 405 imposes some minimum responsibilities concerning a co-fiduciary's breach.