TPA as Trustee in Plan Document

[JustMe]

Do any TPAs list themselves as Trustee in their client's plan document if they provide Administrative "trustee" services, such as benchmarking fees, confirming deposit of contributions in the plan, signing off on distributions, etc.? This is not 3(16) services. If there is a service agreement in place with such services indicated, what is the benefit of putting the information in the plan document? 

[Bird]

NO

[RatherBeGolfing]

NO NO NO NO NO

[shERPA]

To answer your question, there may be some TPA somewhere doing this.  Is it a good idea?  NO!

[ESOP Guy]

Not only don't we do things like that we are told to not do anything that can be construed to turn us into some kind of fiduciary by accident. 

When a client asks me to review a QDRO I don't write back the DRO is approved or qualified.   I write back that I recommend to the Plan Administrator they approve the DRO as qualified.  This is so I or my company isn't seen as the one who decides if a DRO is in fact qualified and approved by us.  

There are all kinds of little things I have learned over the decades like that to help make the case we as a TPA aren't the PA.  

[JustMe]

Thank you all for your comments. 

[Luke Bailey]

Most or perhaps all states' financial codes prohibit legal business entities such as corporations or LLCs from acting as trustee unless they have applied for and been granted trust powers under state law, which requires meeting certain regulatory requirements including solvency and experience. I am not sure, but suspect that even an individual (who generally can act as trustee under state law), e.g. a TPA that who was a sole proprietor, might also violate state law if he or she carried on a trust business.