Labor Department, SEC coordinate on participant 401(k) fee disclosures

Labor Department, SEC coordinate on participant 401(k) fee disclosures
The Labor Department and the SEC agree on fee disclosures.
DEC 20, 2011
The Labor Department and the SEC have agreed that if fee disclosures to employees on their retirement plan investment options meet the DOL's requirements, then they also satisfy the SEC's advertising rules. The Securities and Exchange Commission yesterday sent a no-action letter to the Labor Department indicating as much. The agencies' agreement centers on a fee disclosure mandate from the DOL that would require plan sponsors to give employees a breakdown of the returns, benchmarks and fees of the investments in their 401(k)s. Plans will be required to provide the first set of disclosures tied to this regulation by May 31, 2012. Though the rule was written to apply to plan sponsors and service providers, record keepers and fund managers are more likely to be the ones who disseminate that information to employees. Those providers already have to reckon with the SEC's regulations on advertising as applicable to 401(k) plan investments, including an amendment that would call for extra details on target-date funds. The agreement recognizes that disclosures that already meet the Labor Department's requirements are also in compliance with the SEC's advertising rules. “This ultimately will reduce the cost of regulatory compliance for these plans,” said Assistant Labor Phyllis Borzi, who heads the Employee Benefits Security Administration.

Latest News

Maryland bars advisor over charging excessive fees to clients
Maryland bars advisor over charging excessive fees to clients

Blue Anchor Capital Management and Pickett also purchased “highly aggressive and volatile” securities, according to the order.

Wave of SEC appointments signals regulatory shift with implications for financial advisors
Wave of SEC appointments signals regulatory shift with implications for financial advisors

Reshuffle provides strong indication of where the regulator's priorities now lie.

US insurers want to take a larger slice of the retirement market through the RIA channel
US insurers want to take a larger slice of the retirement market through the RIA channel

Goldman Sachs Asset Management report reveals sharpened focus on annuities.

Why DA Davidson's wealth vice chairman still follows his dad's investment advice
Why DA Davidson's wealth vice chairman still follows his dad's investment advice

Ahead of Father's Day, InvestmentNews speaks with Andrew Crowell.

401(k) participants seek advice, but few turn to financial advisors
401(k) participants seek advice, but few turn to financial advisors

Cerulli research finds nearly two-thirds of active retirement plan participants are unadvised, opening a potential engagement opportunity.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today’s choppy market waters, says Myles Lambert, Brighthouse Financial.

SPONSORED Beyond the dashboard: Making wealth tech human

How intelliflo aims to solve advisors' top tech headaches—without sacrificing the personal touch clients crave