Lisa Shidler

What am I missing? Did these RIA’s not have written service agreements with each client? Did the agreement not spell out the fees, the fact they are a fiduciary, and the services for which they charge the fees? What are examples of the specific omissions or mistakes?

Hey Joe, As you see in the story, there are number of potential concerns. In some cases, the attorneys are worried that RIAs may get hit for not interpreting the disclosures in the same way as the DOL. For instance, what if an RIA includes a statement that says fees can range from 0 to 8%. ERISA attorney Fred Reish says many people wrote their documents this way, but it’s possible the DOL could say that’s not good enough because it’s too wide of a range.

Erring 401(k) plan advisors seek do-overs from DOL to ward off potentially crippling fines

Fred Reish:

ERISA

401(k)

401(k)helpcenter

Penniall & Associates

Drinker Biddle & Reath

Sheridan Road

Craig Watanabe

Rick Meigs

Jim O’Shaughnessy

Fred Reish

Jason Roberts

Brad Campbell

Bruce Ashton

The days when RIAs were the outsiders at the 401(k) party are fast coming to a close. What's new is that the mass of 401(k) assets 
is getting critical at about $3 trillion; fiduciary advisors are getting appreciated; fat fees and questionable kickbacks are getting exposed and stepping out of line is getting dicier as the Department of Labor tightens the regulatory screws.

The old reasons why the 401(k) business is attractive are still in place: there are fresh assets pouring in every month and when employees leave jobs or retire, they produce rollovers that build up IRA accounts for financial advisors. The drawbacks of getting into the 401(k) business are still in place, too. Dealing with retirement assets is really a second line of business and it remains -- unless you overcharge with hidden fees -- a low margin business with high potential fiduciary liabilities.

Still, the outsourcers, infrastructure and accumulated knowledge for RIAs to capitalize on is growing daily and a the mega-shift of assets away from brokers is making the 401(k) business riskier and riskier -- to ignore.

401(k) Stories

A proposal from leading ERISA attorneys would let RIAs say  mea culpa on misinterpretations and technical fouls in the wake of new fee disclosure rules

Erring 401(k) plan advisors seek do-overs from DOL to ward off potentially crippling fines

Joe Gordon

Lisa Shidler

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