Trustee risks for an ESOP with Privately Held Stock?

[Guest Rob Walter]

Do you know what liability/risk is involved for a trustee of an ESOP that holds privately held stock?

[RLL]

If the trustee violates it's fiduciary responsibilities under ERISA, he, she or it is liable for any resulting loss to the ESOP.

There are thousands of ESOPs which hold stock of closely-held companies. A trustee that is experienced in serving as an ESOP fiduciary, or that relies on the advice of competent, experienced legal and financial advisers, should not be incurring unmanageable risks if it follows appropriate procedures and complies with ERISA.

Do you have a particular situation which has raised concerns?