Trust Updates Archive
(Sept. 20, 2012 --Chicago, IL) -- The U.S. Department of Labor has launched two new websites intended to assist with fee disclosure: one for plan fiduciaries, the other for participants.
Plan sponsors seeking fiduciary relief for a service provider's failure to comply with the DOL's plan-level fee disclosure rule can now file notices online at www.dol.gov/ebsa/regs/feedisclosurefailurenotice.html. This new system replaces the option of filing notices via e-mail. Regulators say the advantage of the new system is that it will ensure all required information is filed. The system will provide a filing confirmation.
Effective July 1, 2012, new regulations protect plan sponsors and other plan fiduciaries from liability for a breach of their fiduciary duties under ERISA when, without the plan sponsor's knowledge, a service provider fails to comply with fee disclosure requirements. If a plan sponsor discovers that required information has not been furnished and efforts to obtain the information are not successful, the sponsor must notify the DOL by regular mail or electronically.
In addition to the new website, plan sponsors still have the option of mailing information to U.S. Department of Labor, Employee Benefits Security Administration, Office of Enforcement, P.O. Box 75296, Washington, D.C. 20013. However, the agency is encouraging use of the website.
Participants seeking information on disclosures can now go to www.dol.gov/ebsa/publications/understandingretirementfees.html. The new website is intended to assist those with 401(k)-type retirement plans to better understand the impact of plan costs on their accounts. It also includes new tips and tools on making "smart" retirement investment decisions, say regulators.
According to DOL Assistant Secretary of Labor for Employee Benefits Security Phyllis C. Borzi, "Fees can eat away at retirement savings. Access to good information can lead to an increase of tens -- even hundreds-of-thousands -- of dollars in retirement savings over the course of a career.".
Regulators note that research has shown that paying just 1 percent more in fees can lead to a 28 percent decrease in a 401(k) account balance over the course of a career.
For more on this topic, see Trust Regulatory News.
No statement in this issue is offered as or should be construed as legal opinion or advice or as an indicator of future performance.
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