401(k) disclosure regs floated

The Department of Labor proposed a new rule for fiduciaries meant to increase fee disclosure in 401(k)s.
DEC 12, 2007
The Department of Labor proposed a new rule for fiduciaries meant to increase fee disclosure in 401(k)s. The new rule is intended to help fiduciaries determine the reasonableness of the fees paid to service providers and is also intended to pinpoint if there's a conflict of interest that may affect a service provider's performance under a service contract. The proposed regulations would enhance disclosure to plan fiduciaries by requiring that contracts between certain service providers and plans provide for specific and detailed information, according to a statement from the department of labor. The proposal requires that all services furnished to a plan and all compensation, direct and indirect, to be received by the service provider be disclosed in writing. “One of the department’s top priorities is improved disclosure in order to ensure that participants and fiduciaries have the information they need to make informed decisions,” said U.S. Secretary of Labor Elaine L. Chao in a statement. “We are working quickly to implement regulations that foster fair, competitive and transparent prices for services as well as combat excessive or hidden plan fees.”

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