Category Archives: Fiduciary updates

Legislative Updates: Second Quarter 2018

THE END OF THE DOL FIDUCIARY RULE

On June 21, 2018, the Court of Appeals for the Fifth Circuit officially vacated the Department of Labor’s (DOL) 2016 fiduciary rule in its entirety, including the related prohibited transaction exemptions and the Best Interest Contract (BIC) exemption. The Court held that the DOL exceeded its rulemaking authority under ERISA in enacting the rule. Read more »

Arnerich Massena Publishes New White Paper – Retirement Plan Best Practices: Participant Education

Arnerich Massena is pleased to announce the publication of a new white paper, Retirement Plan Best Practices: Participant Education. This paper is the last of a five-part series outlining retirement plan best practices; the series includes Plan Governance, Plan Design, Investment Menu Construction, and Plan Monitoring, and now concludes by covering participant education. Participant Education examines best practices for a plan sponsor in designing education and engagement programs to improve participants’ financial wellness and long-term retirement outcomes. Read more »

Why Go Discretionary?

The number of discretionary consulting arrangements used by plan sponsors has more than doubled since 2011.1 The trend, also called outsourced chief investment officer (OCIO) or a 3(38) arrangement (referring to the applicable section of Employee Retirement Income Security Act of 1974 (ERISA), has increased as plan sponsors look for ways to reduce fiduciary liability, increase decision-making efficiency, and rely on their investment consultant’s expertise. What is the difference between a traditional, or 3(21) consulting arrangement, and a 3(38) discretionary arrangement, and why would a plan sponsor choose to go discretionary?

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The DOL Reminds ERISA Fiduciaries That Economic Considerations Must Come Before ESG

In the Department of Labor’s (DOL) Interpretive Bulletin 2015-01, guidance encouraged plan sponsors to incorporate into their plans economically targeted investments (ETIs), investments that are selected, in part, for the social and/or environmental benefits they provide in addition to the investment return. Now, a new Field Assistance Bulletin, No. 2018-01, reminds fiduciaries that economic considerations must take priority over any collateral environmental or social benefits. Fiduciaries may not sacrifice investment return or take on additional investment risk in order to pursue environmental, social, and governance (ESG) factors in an investment. Read more »

The Fifth Circuit Court of Appeals Overturns the Department of Labor’s Fiduciary Rule

The Department of Labor’s (DOL) fiduciary rule passed in 2016, but has met with numerous obstacles and delays throughout its implementation. On March 15, the Fifth Circuit Court of Appeals overturned it completely, ruling that it represents overreach by the Department of Labor. The decision, which reversed an earlier district court ruling in favor of the regulation, states that the DOL exceeded its statutory authority in issuing the rule. The new ruling suggests that oversight of this issue should fall under the purview of the U.S. Securities and Exchange Commission (SEC). Read more »

Arnerich Massena Publishes New White Paper – Retirement Plan Best Practices: Plan Monitoring

Arnerich Massena is pleased to announce the publication of a new white paper, Retirement Plan Best Practices: Plan Monitoring. This paper is the fourth of a five-part series outlining retirement plan best practices; the series began with Plan Governance, Plan Design, and Investment Menu Construction, and will conclude by covering participant education. Plan Monitoring examines best practices for a retirement plan sponsor in maintaining and monitoring their plan over time. Read more »

What is Financial Wellness and Why is it Important?

The 2017 Retirement Confidence Survey found that 3 in 10 workers worry about their personal finances while at work.1 What does this mean for employers, and what can you do about it? Research into financial wellness is beginning to show just how much of a toll financial anxiety can take on workers. Financial wellness is more than just a trendy term; it points to a very real problem, but there are solutions. Read more »

Department of Labor’s Fiduciary Rule Officially Delayed for 18 Months

At Arnerich Massena, we are proud that we have always been ahead of the curve on this issue. We’ve expressly acknowledged our fiduciary status and have offered independent, unbiased advice to retirement plans since our inception. Regardless of the outcome of the rule’s delay, we will continue to embrace our fiduciary status and work in the best interest of Arnerich Massena clients and our clients’ retirement plan participants.

On Monday, the Department of Labor (DOL) announced an additional 18-month extension for several key provisions of its fiduciary rule. Full implementation of this rule has been delayed several times since it was adopted in 2016. Read more »