LATE QDIA/FEE DISCLOSURE NOTICES

[Karoline Curran]

Another question! I can't find documentation that there are penalties for late QDIA/Fee disclosure notices.  I have a 09/30 plan who should have gotten both notices by today-- Nationwide is running late so they will not be received timely.  The client is worried about a penalty from the DOL...

 

Thank you!!!

[ERISTOCRAT]

Hi Karoline, 

Did you ever receive an answer to this question? I am looking into a similar issue and based on what I have read it appears that the failure to timely provide a QDIA notice results in the loss of 404(c) fiduciary protection for the default investment. However, it is unclear whether the protection is lost for the entire Plan year if the QDIA notice is not sent at least 30 days prior to the first day of the Plan year or whether protection is provided beginning 30 days after the QDIA notices are sent. 

If you additional information that is helpful and could provide that to me I would appreciate it. 

Thanks!

[Karoline Curran]

Hi Eristocrat - no I didn't  I researched on my own and didn't find anything definitive either, other than what you mentioned!  If I find anything else I will certainly let you know.

[Bird]

Agreed, I don't think there are any specific penalties other than loss of fiduciary protection.  Which means the risk is from a participant lawsuit, which is generally not going to be worthwhile.