On October 21, the dynamic podcasting duo of Nevin (Adams) & Fred (Reish) brought their engaging, informative, and occasionally alliterative discussion to ASPPA Annual.

As one might expect from a crowd composed of the nation's leading recordkeepers and third party administrators (and a bunch of experts that help them succeed), the discussion was, as always, wide-ranging, including constantly compelling topics like:

Latest Lessons from the Litigation Landscape – fending off fiduciary forfeiture suits

Fiduciary Faux Pas, Pitfalls and Best Practices

Scary stuff from SECURE 2.0 – implications of auto-enrollment for all plans, LTPT employee tracking, etc.

Things I Worry About: Automatic Enrollment (1) https://fredreish.com/things-i-worry-about-automatic-enrollment-1/

Nevin & Fred: Forfeiture Litigation, Meeting Minutes and More https://www.napa-net.org/news/2024/10/nevin--fred-forfeitures-meeting-minutes-and-more/

What Expenses Can Be Paid from Plan Assets?

7 Steps to Reduce Fiduciary Exposure

DOL Successfully Sues Employer for Misuse of Forfeitures

Limiting Fiduciary Liability (Costs)

IRS Proposes Regs to Clarify Timing and Use of Forfeitures

Expert Opinions

The Forfeiture Suits to Date

In a “live” version of the Nevin & Fred podcast at the Strategic Retirement Partners (SRP) annual conference, Nevin & Fred (& Bonnie Treichel & Tom Clark) covered recent litigation trends—and more!

In recent months, the plaintiffs’ bar has “discovered” a new litigation target: the use of forfeitures to offset employer contributions, rather than to offset plan fees or to reallocate them to the remaining participants in the plan. The expanded expert podcast panel reviews the current status, the trend(s), and what plan fiduciaries can/should do about it.

And—on a related topic—what should/shouldn’t be included in committee meeting minutes!

Episode Resources

What Expenses Can Be Paid from Plan Assets? https://www.asppa-net.org/news/2018/10/what-expenses-can-be-paid-plan-assets/ 7 Steps To Reduce Fiduciary Exposure https://www.napa-net.org/news/2019/2/7-steps-reduce-fiduciary-exposure/ New Fiduciary Suits, TDF Demographics and a Prudent Process Primer https://www.napa-net.org/news/2024/4/new-fiduciary-suits-tdf-demographics-and-prudent-process-primer/ Litigation Landscape Some 'Wins,' Some Losses and a New Litigation Target https://www.napa-net.org/news/2023/11/litigation-landscapesome-wins-some-losses-and-new-litigation-target/ DOL Successfully Sues Employer for Misuse of Forfeitures https://www.napa-net.org/news/2024/1/dol-successfully-sues-employer-misuse-forfeitures/ Limiting Fiduciary Liability (Costs) https://www.napa-net.org/news/2021/8/limiting-fiduciary-liability-costs/

IRS Proposes Regs to Clarify Timing and Use of Forfeitures https://www.napa-net.org/news/2023/2/irs-proposes-regs-clarify-timing-and-use-forfeitures/

Expert Opinions https://www.napa-net.org/news/2019/2/expert-opinions/

The forfeiture suits to date. https://www.napa-net.org/header/search/?q=forfeitures

ERISA Advisory Council testimony by:

Bonnie Treichel - https://www.dol.gov/sites/dolgov/files/ebsa/about-ebsa/about-us/erisa-advisory-council/2024-qdia-treichel-written-statement-07-10.pdf

Tom Clark: https://www.dol.gov/sites/dolgov/files/ebsa/about-ebsa/about-us/erisa-advisory-council/2024-qdia-clark-written-statement-07-10.pdf

The so-called fiduciary rule has been stayed—and legal challenges regarding forfeiture reallocation are picking up. Nevin & Fred discuss what you should be doing…now.

About a month ago two separate federal judges put a hold on the effective date (09/23) of the Labor Department’s new fiduciary rule—indefinitely. n ordering the stay, United States District Judge Jeremy D. Kernodle explained that “the 2024 Fiduciary Rule suffers from many of the same problems” that were found in the version vacated by the Fifth Circuit back in 2018.

On the other (unrelated) hand, the number of suits alleging a fiduciary breach in the use of forfeitures to offset employer contributions is increasing—and most recently those charges have been appended to the more “traditional” excessive fee suits. That, and a couple of the original group have now gotten past the motion to dismiss.

In light of those trends, what should plan fiduciaries do? In this podcast episode, Nevin & Fred will discuss the trends, the issues, the implications, and some next steps.

Episode Resources:

Staff Bulletin: Standards of Conduct for Broker-Dealers and Investment Advisers Account Recommendations for Retail Investors https://www.sec.gov/tm/iabd-staff-bulletin

Fiduciary Rule

Federal Judge Slams Brakes on Fiduciary Rule https://www.napa-net.org/news-info/daily-news/breaking-news-federal-judge-slams-brakes-fiduciary-rule

Another Federal Court Slams Fiduciary Rule https://www.napa-net.org/news-info/daily-news/another-federal-court-slams-fiduciary-rule

Department of Labor Releases Final Investment Advice Fiduciary Rule https://www.napa-net.org/news-info/daily-news/breaking-department-labor-releases-final-investment-advice-fiduciary-rule

Forfeiture Reallocation Litigation

Major Forfeiture Fiduciary Breach Suit Gets Green Light https://www.napa-net.org/news-info/daily-news/major-forfeiture-fiduciary-breach-suit-gets-green-light

Another Excessive Fee Suit (Also) Claims Forfeiture Use a Fiduciary Breach https://www.napa-net.org/news-info/daily-news/another-excessive-fee-suit-also-claims-forfeiture-use-fiduciary-breach

Nordstrom Nailed With Massive Allegations in 401(k) Fiduciary Breach Suit https://www.napa-net.org/news-info/daily-news/nordstrom-nailed-massive-allegations-401k-fiduciary-breach-suit

Future Live Appearances:

Strategic Retirement Partners: https://www.srpretire.com/ ASPPA Annual: https://asppaannual.org/

NAPA 401(k) Summit: https://napasummit.org