Quarterly statements: Electronic format only

[Mr Bagwell]

A good sized player in the 401k market sent this letter to my co-worker in July 2018.

Actual language.

"What is happening?  In an effort to add extra security to the handling of your private information, your quarterly statement will be available going forward in electronic format only.  Switching to electronic transmission of these statements allows us to become more digitally based and environmentally conscious with our paper usage, and provides quicker access to past statements.

What does this mean to you?  You will receive a notification to the email address saved in your profile whenever your new quarterly benefit statement is available online.  This notification will contain a link to the login page of your account.  Please note that if you were already receiving your statements online, there is no charge, and that electronic delivery does not automatically apply to any other plan information, which you have the right to receive in writing.  If you are interested in receiving other plan communications electronically, please follow the instructions found in the e-documents section of your account.  There, you can select all of your other paperless preferences.

What actions should you take?  We strongly encourage you to visit the plan's website at ...., where you can view, print, or download your current and past statements, utilize insightful reports and financial tools in addition to seeing your other important account information.  To ensure the statement notification goes to the correct address, please take a moment to log into your account and view the account summary to verify that your preferred email is saved to your profile.

If you have any questions or concerns, or would like a paper copy of your quarterly statements, do not hesitate to contact one of your plan's Customer Care Representatives at .....

FAB 2006-03A"

 

Electronic format only?  Anyone else doing electronic format only?  I'm aware of participants being able to request electronic format only, but a full plan level change to it?  It's like a negative election quarterly statement if you wanted paper.  FAB 2006-03A mentions that paper statements can be requested for fee of charge.  This provider is still offering paper, you just going to have to work to get it.

I'm surprised, and yet, not surprised by this action.  Figured we would end up there anyway.

Any thoughts on this?

 

[RatherBeGolfing]

30 minutes ago, Mr Bagwell said:

A good sized player in the 401k market sent this letter to my co-worker in July 2018.

Actual language.

"What is happening?  In an effort to add extra security to the handling of your private information, your quarterly statement will be available going forward in electronic format only.  Switching to electronic transmission of these statements allows us to become more digitally based and environmentally conscious with our paper usage, and provides quicker access to past statements.

What does this mean to you?  You will receive a notification to the email address saved in your profile whenever your new quarterly benefit statement is available online.  This notification will contain a link to the login page of your account.  Please note that if you were already receiving your statements online, there is no charge, and that electronic delivery does not automatically apply to any other plan information, which you have the right to receive in writing.  If you are interested in receiving other plan communications electronically, please follow the instructions found in the e-documents section of your account.  There, you can select all of your other paperless preferences.

What actions should you take?  We strongly encourage you to visit the plan's website at ...., where you can view, print, or download your current and past statements, utilize insightful reports and financial tools in addition to seeing your other important account information.  To ensure the statement notification goes to the correct address, please take a moment to log into your account and view the account summary to verify that your preferred email is saved to your profile.

If you have any questions or concerns, or would like a paper copy of your quarterly statements, do not hesitate to contact one of your plan's Customer Care Representatives at .....

FAB 2006-03A"

 

Electronic format only?  Anyone else doing electronic format only?  I'm aware of participants being able to request electronic format only, but a full plan level change to it?  It's like a negative election quarterly statement if you wanted paper.  FAB 2006-03A mentions that paper statements can be requested for fee of charge.  This provider is still offering paper, you just going to have to work to get it.

I'm surprised, and yet, not surprised by this action.  Figured we would end up there anyway.

Any thoughts on this?

 

Is this an email to a participant or to the sponsor?

Not making paper available to the participant would be contrary to regulations.  I could see electronic only to the SPONSOR, who would then be in charge of delivering to the participants per their instructions.

ASPPA GAC has been fighting hard for opt-out rather than opt-in, but the DOL is still standing firm on paper as default.

 

[Peter Gulia]

Many recordkeepers use regimes for which a failure to "opt out" and expressly request paper is an implied or deemed assent to getting statements by electronic means.

Here's the next question:

How many retirement plans allocate an incremental charge on the account of a participant who requests paper statements?

 

[RatherBeGolfing]

39 minutes ago, Fiduciary Guidance Counsel said:

Many recordkeepers use regimes for which a failure to "opt out" and expressly request paper is an implied or deemed assent to getting statements by electronic means.

But the RK probably isn't a plan fiduciary in that case right?

44 minutes ago, Fiduciary Guidance Counsel said:

Here's the next question:

How many retirement plans allocate an incremental charge on the account of a participant who requests paper statements?

Good question.  I believe they can (and do) charge for paper statements.  I am 99.9% sure they cannot charge a fee for required disclosures just because the participant expressly wants a paper disclosure.  I'll have to come back later to see if I can cite it...

[Mr Bagwell]

Letters are to participants.

[Mr Bagwell]

FAB 2006-03A has the following sentence

"In addition, the notification must apprise participants and beneficiaries of their right to request and obtain, free of charge, a paper version of the pension benefit statement information required under section 105."

 

[CuseFan]

It's just the green revolution - touted to save the environment (which it does) - but the real purpose of which is to save the RK some green(backs). Cut and dried. We certainly do all we can to have participants elect paperless as much as allowable, but it's not a negative election. They get paper unless they affirmatively elect otherwise.

[Pam Shoup]

We are going to continue defaulting to paper and let the participants opt in to estatements.  We will let the big recordkeeper hash it out with the DOL.  However, I am rooting for the recordkeeper to prevail on this one!

[Pension Dork]

If my plan sent me this notice, I'd contact them independently to find out if it's a phishing scam.  It's written like the English translation of IKEA assembly directions! 

 

 

[Patricia Neal Jensen]

Client/ fiduciary should push back on this.   Too far too fast.  They have to offer a paper statement or the fiduciary should find someone who will.   See regulations on e-transmissions of notices and other documents.   The vendor will argue that they are not a fiduciary.  The real fiduciary action here is with the plan sponsor who permits this.