We understand the need to educate our clients. Through education and understanding, our clients become fully aware of their responsibilities and duties as plan sponsors of their 401k plans. More and more companies are switching from their current relationship with a Broker/Dealer or an Insurance company to an Investment Advisor.

The difference is legal, Registered Investment Advisers (RIA) are held to a different standard than Brokers. The Investment Advisers Act of 1940, which legally obligates that RIA’s act solely in the best interests of their clients.

Brokers, meanwhile, are regulated by the National Association of Securities Dealers, which imposes a "suitability standard" rather than the stricter fiduciary standard. This simply means an investment sold by a broker must be suitable for the client. Brokers by SEC rules must also put the investment needs of the firm first before the needs of their client. Source: BankRate.com

401k Plan Sponsors Fiduciary Duties and Responsibilities

“Those persons or entities that are fiduciaries are in a position of trust with respect to the participants and beneficiaries in the plan.” Source: IRS.gov

Number of ERISA lawsuits rising

Lawsuits relating to the Employee Retirement Income Security Act (ERISA) are increasing in number and complexity, according to a new study. PensionLitigationData.com released the “ERISA Litigation Study,” a statistical overview of the pension lawsuits by category, court and case disposition.

The study, based on over 2,400 ERISA cases filed between Jan. 1, 2005 and Aug. 31, 2008, found:

• ERISA lawsuits are increasing in number and complexity in terms of combinations of allegations
• Nearly every case in the PensionLitigationData.com database is categorized as including an allegation of fiduciary breach
• ERISA litigation volume was highest for the 2nd, 3rd and 6th federal circuit courts
• A majority of ERISA-related lawsuits settled out of court
• Numerous cases examined reflect an ERISA Section 502 claim (ERISA Section 502 relates to civil enforcements.)
• Some legal venues favored plaintiffs in terms of the reported outcome

Would you like to learn more? Give us 15 minutes and we can show you how to: “Minimize your fiduciary duties and responsibilities as a plan sponsor of your 401k”

Topics that will be covered are:

• How to build or rebuild a successful retirement plan
• Understanding “Full Disclosure”
• Understanding “Revenue Rebate” which you are probably not receiving.
• Understanding “Fiduciary Duties & Responsibilities”
• Eliminating fund bias
• Removal of commission based relationship
• Understanding the importance of an Investment Advisor relationship
• How to protect yourself from potential lawsuits