Directed TTEE vs. Named Fiduciary

[Guest Ephesian431]

I am working with a company that is told that their current provider (bank 1) is a named fiduciary. They are looking at another provider who is a directed trustee (bank2). Bank 1 says that they provide a much greater service than Bank2. Is this so?

Is the plan sponsor relieved of fiduciary responsibility with Bank 1? If not, what is their responsibility?

Add. Info.: plan type 401k

Participant directed

Plan sponsor picks fund choices

Currently use bank 1 funds and a

few outside funds

Fund performance is a issue

[This message has been edited by Ephesian431 (edited 02-07-2000).]

[Guest Les Revzon]

Bank 1 is a fiduciary but not the Named Fiduciary which is normally the plan administrator. Bank 1 as a trustee would have the same capacity as Bank 2, they both are non-discretionary trustees and fiduciaries. The plan sponsor has exactly the same fiduciary responsibility under both banks. It sounds to me as if Bank 1 doesn't understand their role under ERISA.