"[E]ven after the start-up, a ROBS company continues to face unique PT pitfalls.... [T]he assets of a ROBS corporation are generally considered to be plan assets, especially during the period immediately following a ROBS funding transaction. This means that the Company's bank account and other assets are covered by the PT rules. The rule ... can easily trip up an unwary ROBS plan sponsor, because it forbids many otherwise perfectly acceptable and common business practices."  MORE >>

"Allowing Chapter 7 bankruptcy trustees to use the Abandoned Plan Program gives them a clearer path for terminating and making distributions from bankrupt entities' 401(k) plans and potentially reduces the erosion of participant accounts by administrative fees.... [The DOL] has requested additional comments ... and indicated that more changes may be made (including possibly extending the program to cover plans of entities in Chapter 11 bankruptcy or receivership under the FDIC or other applicable federal or state law)."  MORE >>

"Disagreeing with the district court, the Ninth Circuit concluded that substantially inaccurate benefit statements do not meet ERISA's plain-text requirements for such disclosures ... Further, the court found that the requests the plaintiffs made through the employee benefits website qualified as 'written' requests sufficient to trigger the Administrative Committee's duties." [Bafford v. Northrop Grumman, No. 22-55634 (9th Cir. May 9, 2024)]  MORE >>

"[The judge] seems to be focusing on the individual recovery, rather than the plan recovery that would be associated with an ERISA suit -- and the distinction that the other cited courts seemed to find. And he seems to think that as long as the plaintiff has the ability to seek his individual remedies unimpeded, that is sufficient to warrant deferring to the arbitration provisions in the plan document." [Yagy v. Tetra Tech, Inc., No. 24-1394 (C.D. Calif. May 17, 2024)]  MORE >>

"The suit argues that if applied, the new fiduciary rule would cause 'dire consequences for tens of thousands of independent insurance agents and their clientele if not stopped.' Therefore, its implementation should be delayed until the first lawsuit is settled, plaintiffs maintained." [Federation of Americans for Consumer Choice Inc. v. DOL, No. 24-0163 (E.D. Tex. complaint filed May 2, 2024; motion for stay filed May 21, 2024)]  MORE >>

"Plaintiffs claim that this effort by DOL 'to assert new regulatory jurisdiction in the IRA market' is 'beyond its statutory authority' ... Plaintiffs believe ... that there is (legally) a status-based distinction between investment advisors, who may give fiduciary advice, and brokers, who are (always) merely salespeople and (in effect, by definition) cannot be advice fiduciaries[.]" [Federation of Americans for Consumer Choice Inc. v. DOL, No. 24-0163 (E.D. Tex. complaint filed May 2, 2024)]  MORE >>

"Federal agencies can take steps to facilitate better understanding by participants of their distribution options and corresponding tax consequences, which can also assist spouses when they are informed of their spousal rights. GAO made recommendations in January 2024 to the Department of the Treasury and the [DOL] to improve the information provided to 401(k) participants, including the 402(f) Notice." [GAO-24-107167 May 22, 2024]  MORE >>

"In 2023, 401(k) assets rose about 15% year-over-year to hit $7.4 trillion, the second highest mark in history after 2021's $7.9 trillion, according to a recent update by the Investment Company Institute. Meanwhile, the average balance for 401(k) savers was up 19% to $134,128 at the end of last year due in large part to market performance, according to Vanguard's most recent data."  MORE >>

17 pages. "The RFI's most central shortcoming is its misstatement of its statutory mandate, and its treatment of hard data collection as optional.... We strongly recommend that the [DOL], or other responsible agency, write an introductory paragraph for each required notice in language understandable to the average participant.... Plans should be responsible for providing, at a minimum, Spanish translations, and preferably more language translations if they have a particular ESL (English as a second language) community in their workforce and plan."  MORE >>

10 pages. "The determinative factor in the effectiveness of reporting to the Agencies is driven by the Agencies.... ARA recommends that Agencies ensure that any reporting element is narrowly crafted to promote correct reporting and generally limit the breadth of reporting to avoid undue burden. In addition, ARA strongly recommends the agencies invest in further development of electronic filing systems."  MORE >>