Los Angeles partner Fred Reish published his latest “Just out of Reish” column in the May 2013 issue of PLANSPONSOR.
Under the Employee Retirement Income Security Act (ERISA) Section 408(b)(2) regulation, covered service providers had to provide plan committees—in their role as the responsible plan fiduciary—with disclosures about services, status and compensation.
Under the Section 404(a)5 participant disclosure regulation, plan committees—serving as the ERISA plan administrator—were required to provide participants with detailed disclosures about plan features, investments and costs. But, as a practical matter, 401(k) recordkeepers handled most of the participant disclosures.
In both cases, plan sponsors and committees have the responsibility to ensure that the required disclosures were made. This column focuses on the fiduciary duty of plan sponsors to prudently evaluate disclosures from their advisers.*