Road Map to Retirement Plan Success!

January 4, 2022

We’re all aware of the numerous fiduciary breach lawsuits involving retirement plan sponsors and their investment committees. Some have settled; Some have not.

A recent pre-trial settlement of fiduciary breach charges against bank holding company BB&T Corporation* is worth noting. BB&T Corp agreed to a $24 million settlement fund (less attorney fees) to be distributed to plan participants. Yes! That’s a lot of money!

However, what plan sponsors should find noteworthy are the non-monetary terms of the settlement. They provide a “road map” to mitigate risk and avoid litigation.

Non-Monetary Terms:

In addition to the monetary settlement, the plan Sponsor fiduciaries have agreed to:

  • Engage an independent Investment Consultant to provide independent consulting services to the Plan
  • The Investment Consultant will evaluate the plan’s investment options and provide the Plan fiduciaries with an objective evaluation of the options in the plan
  • The plan fiduciaries agreed to participate in a training session regarding ERISA’s fiduciary duties
  • Following entry of the Final Order, Plan sponsor will rebate to the plan participants “any 12b-1 fees, sub-ta fees, or other monetary compensation that any mutual fund company pays or extends to the Plan’s recordkeeper based on the Plan’s investments”
  • If, following the entry of the Final Order, Plan sponsor decides to charge Plan participants a periodic fee for recordkeeping services, the plan fiduciaries / Investment Consultant will conduct a Request for Proposal for the provision of recordkeeping and administrative services.

Consider the first bullet. Engaging the right independent consultant will ensure that the remaining items are carried out, using a process driven approach, mitigating fiduciary risk and improving retirement outcomes for your employees.

Contact Centurion Group today for an independent evaluation of your retirement plan.