Delay in 401K rollover

[sbuck]

PC left employment and attempted to rollover employer sponsored 401K to private account.  Due to an administrative error, one by the employer and one by the TPA the rollover did not occur until about 70 days after it was originally scheduled.  PC alleges that due to the error he lost a significant amount of money because he was unable to pursue the investment strategy recommended by the private account manager.  I don't see any relief available under the plan document; the loss he claims is speculative and occurred outside the terms of the plan.  Is this a 502(a)3 claim, a nothing claim, or something in between?  I'm trying to get ideas because I think I'm getting a little tunnel vision on it.  Thanks for any ideas, suggestions.

[Larry Starr]

4 hours ago, sbuck said:

PC left employment and attempted to rollover employer sponsored 401K to private account.  Due to an administrative error, one by the employer and one by the TPA the rollover did not occur until about 70 days after it was originally scheduled.  PC alleges that due to the error he lost a significant amount of money because he was unable to pursue the investment strategy recommended by the private account manager.  I don't see any relief available under the plan document; the loss he claims is speculative and occurred outside the terms of the plan.  Is this a 502(a)3 claim, a nothing claim, or something in between?  I'm trying to get ideas because I think I'm getting a little tunnel vision on it.  Thanks for any ideas, suggestions.

Nonsense. Tell him to go pound sand (nicely, if you want).  If he starts talking lawyer, my answer is ALWAYS: My lawyer can beat up your lawyer!  There is no lawyer who will take this case on a contingent basis, and he won't pay for a lawyer on a cash basis.

[Below Ground]

Every plan applies some form of the phrase "administrative feasibility" toward the processing of benefit distributions.  The idea that a qualified retirement plan is like a bank saving account is not correct.  You don't come in with your withdrawal ticket and walk out with money.  Anyway, my point is intended to supplement the comments of Mr. Starr in that the application of "days after it is scheduled" does not fit "real life".    Consider the fact the most plans will have a 90 period for the administrator to issue a written denial of a claim for benefits, which suggests that there is potentially a 90 period to review the benefit (which can even be automatically extended by another 30 days).  With this provision alone, I think you are pretty safe to take Mr. Starr's suggestion to "tell him to go pound sand".  Perhaps if you were talking about a long period of time, but 70 days?  I don't see this as being anything beyond a nuisance claim.

[MPLSLAW]

You didn't say but we are assuming the account was invested during the 70 days until it was processed.  If the investment was put to cash when the original request came in and there were no earnings during a stock market run up, there may be a breach of duty claim.  Just saying. 

[sbuck]

yeah, the money did stay with the plan and continued to earn money during the delay.  There was no loss within the terms of the plan.