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[Official Guidance]

Text of PBGC Final Regs: Examination and Copying of Pension Benefit Guaranty Corporation Records
"This rule provides for an electronic reading room for records, expands the categories of records in the reading room, updates the standard for disclosure, requires additional notice to requesters about FOIA resources, extends the appeal deadline, and places restrictions on fees."
Pension Benefit Guaranty Corporation [PBGC]


Form 5500 and ERISA Workshops – Registration open

Sponsored by FIS Relius Education

Registration is open for the Form 5500 Workshop and the ERISA Workshop which covers current events, EPCRS and VCP, and plan amendments. Presented back-to-back, multi-program discount is available. View agendas, register now for early fee.

[Guidance Overview]

DOL Fiduciary Rule: June 9 and Beyond
"During the transition period, BIC Advisers ... will only have to comply with the impartial conduct standards to receive relief from the prohibited transaction rules under either the BIC Exemption or BIC Light.... The full BIC Exemption requires a written contract ... for advice provided by BIC Advisers to IRA owners. The contract requirement does not apply to advice for ERISA Plans."
Kilpatrick Townsend

Washington University Is 15th School Sued Over Retirement Plan
"The lawsuit, filed June 8 in the U.S. District Court for the Eastern District of Missouri, says the university's retirement plan overpaid for administrative and record-keeping services and offered 'historically underperforming' investment options. The lawsuit takes particular aim at the plan's reliance on two companies -- TIAA and Vanguard -- for record-keeping services. The use of multiple record keepers confuses investors and leads to higher fees, the lawsuit claims."
Bloomberg BNA

Merrill Lynch to Pay $25M in Lawsuit Over Fees in Small 401(k)s
"Merrill Lynch, Pierce, Fenner & Smith Inc. will pay $25 million to settle a lawsuit that accused the broker-dealer firm of profiting from excessive fees charged to small 401(k) plans... The deal features a 'corrective remediation payment' totaling at least $8.8 million and a 'disgorgement payment' of $16.2 million, the motion said. Class counsel will request attorneys' fees equal to 35 percent of the settlement payment, or $8.75 million, the motion said."
Bloomberg BNA

The Lawyer on a Quest to Lower Your 401(k) Fees
"When Jerome Schlichter started filing 401(k)-fee lawsuits against big companies a decade ago, the personal-injury lawyer from St. Louis wasn't taken seriously.... Companies now are so worried about suits alleging mismanagement of these retirement plans that 401(k) industry consultants have coined a term for the threat: 'getting Schlichterized.' ... Last year, law firms filed more than 25 fee cases against 401(k)-type plans ... That includes 14 from Mr. Schlichter's firm against employers including elite universities.... Consumer advocates say the litigation has saved 401(k) participants nationwide billions of dollars by helping to push down 401(k) fees, which declined 17% from 2009 to 2014[.]"
The Wall Street Journal; subscription may be required


Online Learning Course: Fiduciary Responsibilities for ERISA Plans

Sponsored by International Foundation of Employee Benefit Plans [IFEBP]

Get the information you need to understand the requirements of ERISA, including penalties, vesting requirements, fiduciary responsibilities, plans covered by the PBGC, and the roles of the various enforcement agencies.

The 401(k) Plan Investment Policy Statement
"Seven things to consider including in your investment policy statement: [1] Plan purpose ... [2] Investment objectives/capabilities ... [3] Guidance on monitoring investments ... [4] What assets classes will be included ... [5] Instructions on how to select investments/Approach to performance and measurement ... [6] Establishment of default fund ... [7] Participant education."

Supreme Court Ruling Ends the Battle But Not the War: What Church-Affiliated Church Plan Sponsors Need to Know and Do Now
"To prepare for the next wave of such church plan exemption challenges, non-church organizations that sponsor church plans should thoroughly review the legal structure and operation of the entity that maintains the plan to ensure it is a 'principal-purpose organization'.... [T]he Third and Seventh Circuit Courts of Appeals [had] expressed serious doubt as to whether the defendant hospitals' principal purpose of providing healthcare satisfied the principal purpose test." [Advocate Health Care Network v. Stapleton, No. 16-74 (U.S. June 3, 2017)]
Bradley Arant Boult Cummings LLP

Means and Markets Have Aligned: Why You Should Consider De-Risking Now (PDF)
12 pages. "Building a strong defense now may position companies, particularly those in cyclical industries, to better endure the next downturn, allowing them to pursue growth initiatives at a time when their competitors may be cutting back. This environment could be fleeting, however, and [the authors] believe now is the time to prepare for a lower-risk future."

Fact Sheet for H.R. 2823, the Affordable Retirement Advice for Savers Act (PDF)
"The bill defines 'investment advice' more broadly than DOL's 1975 regulation, expanding the universe of activities that are subject to fiduciary liability. Under the bill, a fiduciary relationship occurs any time an advisor provides one of a broad array of recommendations relating to retirement accounts.... [H.R. 2823] [1] Ensures personalized advice about investments, distributions, or hiring other advisors triggers fiduciary obligations. [2] Requires financial professionals who advise IRAs to act in the best interests of their clients.... [3] Preserves the ability of retirement savers to receive financial education, such as examples of investment alternatives that fit within asset classes."
Committee on Education and the Workforce, U.S. House of Representatives

OregonSaves Edging Closer to Being Live
"Eleven employers were selected for the first pilot program; they successfully completed the registration process for OregonSaves. Dozens of employers are scheduled to join the second pilot program, for which registration will begin in August."
National Tax-Deferred Savings Association [NTSA]

Estimates of the Financial Effects on Social Security of H.R. 2855, the Social Security for Future Generations Act of 2017 (PDF)
"Assuming enactment of the proposal, the projected trust fund reserve depletion year for the theoretical combined OASI and DI Trust Funds would be extended to 2049. Under current law, the projected trust fund reserve depletion year for the combined trust funds is 2034. The proposal includes six provisions ... with direct effects on the OASDI program."
Office of the Chief Actuary, U.S. Social Security Administration [SSA]


Legislation Enhances Consumer Protection for Retirement Savers
"H.R. 2823, the Affordable Retirement Advice for Savers Act, [and] S. 1321, the Affordable Retirement Advice Protection Act ... address the overly burdensome and complex [DOL] fiduciary rule, and replace it with a law that strengthens protections for retirement savers by requiring financial advisors to serve their clients' best interests. IRI strongly supports both bills[.]"
Insured Retirement Institute [IRI]


People in States Represented by the Cosponsors of the Choice Act Lose $12.1 Billion Each Year Due to Conflicted Retirement Advice
"Representatives who voted for the CHOICE Act have chosen to side with unscrupulous actors in the financial industry, who have profited handsomely from loopholes that allowed them to fleece retirement savers. [A map and table] show how much retirement savers lose annually in each state as a result of receiving conflicted advice."
Economic Policy Institute


Pennsylvania Pension Reform, Part 1
"For a system that will likely run out of money by 2034 the thrust of this 'reform' is to reduce those onerous employer contributions while keeping employee contributions at similar, if not higher, levels in part by confusing those new participants impacted."

Executive Compensation
and Nonqualified Plans

ASU 2017-09 Provides Clarity to Modifications to Share-based Compensation Arrangements
"FASB issued Accounting Standards Update (ASU) 2017-09 to reduce the cost and complexity when applying Topic 718 and standardize the practice of applying Topic 718 to financial reporting. The ASU was not developed to fundamentally change the definition of a modification, but instead to provide guidance for what changes would qualify as a modification. This was done by better defining what does not constitute a modification."
Findley Davies | BPS&M

Discussions on
the BenefitsLink Message Boards

Need Aspirin for a Plan Loans Headache
"We have a plan with a few (3 or less) missed payments on loans that are otherwise in compliance with IRC 72(p). The Plan sponsor did not start up payroll deduction payments on time, or there was a short lay-off at the time that payments were to commence. We are well inside the cure period. We would like to reamortize the loans rather than doubling up payments to get them current or demanding a lump sum. Is this really a loan refinance (meaning the loan program must permit refinancing)? Or is it just a reamortization (keeping the terms otherwise the same)? And is something that is eligible for SCP, or does it require VCP?"
BenefitsLink Message Boards

Spousal Attribution as Applied to SEP Sponsorship
"I am married and have a restaurant, with a few full-time employees. My husband is self-employed; his business has no employees. I have been told that he cannot sponsor a 401(k) because we are married and hence my employees would need to be covered under the 401(k). Is that true? If he uses a SEP instead, would the result be different?"
BenefitsLink Message Boards

Press Releases

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David Rhett Baker, J.D., Editor and Publisher
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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2017, Inc. All materials contained in this newsletter are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of, Inc., or in the case of third party materials, the owner of those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.

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