TIAA 403(b) DRO Draft Had Participant/AP Reversed, Missing Plan Info, and 15 Business Days of Silence

[MacroQu]

I am the Alternate Payee/former spouse in this matter and am looking for general feedback from anyone familiar with QDROs, 403(b) retirement plans, TIAA orders, or similar experiences involving defective DRO/QDRO drafts.

After waiting approximately six months for a TIAA 403(b) DRO draft, I finally received one from counsel’s office, and it contained serious errors. This was not simply a completed TIAA template form; it appeared to be a separate/custom DRO draft prepared by counsel’s office that used some TIAA model language in places, including standard provisions addressing beneficiary/death issues.

The draft definitively reversed the Participant and Alternate Payee designations in the order. The identifying addendum also contained incorrect personal information on both parties. The office made several attempts to correct only the addendum, but the addendum still was not fully correct. The DRO draft itself has not been substantively revised or reissued after 15 business days.

The draft did not identify the specific two employer plans, plan numbers, TIAA contract numbers, CREF contract/account, or Other Investments, even though the TIAA template appears to require plan identification. The draft also did not address the participant’s separate-property baseline in one TIAA Traditional RA contract, even though counsel has been aware of that issue for well over a year. The percentage-award language was vague and did not clearly distinguish the community-property interest from the participant’s separate-property portion. It also omitted pro-rata/exclusion language for the TIAA Traditional RA contracts, including language needed to apply the percentage award correctly while excluding the separate-property baseline and preserving the applicable RA allocation/interest-crediting characteristics to the extent administered by TIAA. The draft also did not clearly state the sequence for a separate CREF-only award after the percentage division.

After I sent a detailed written list of corrections, the office partially corrected only the addendum, but no corrected DRO draft, call, status update, or substantive response has been provided after approximately fifteen business days. Staff indicated the draft had been reviewed by counsel before it was sent to me.

For those familiar with QDRO/DRO drafting, TIAA/403(b) administration, or similar experiences, is this type of delay and lack of communication after serious draft defects are reported normal in the QDRO process? What is a reasonable professional expectation for follow-up after a client identifies material errors in a draft DRO?

[Bill Presson]

If you are the alternate payee, YOUR counsel should be preparing the DRO. If not, YOUR counsel should be reviewing the DRO.