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Galvin’s Solution to Year-end Matches: More Disclosure

After a fruitless investigation into the practices of companies that delay match payments until the end of the year — made famous by IBM and infamous by AOL last year — Massachusetts’ chief securities regulator William Galvin called on Congress and the DOL to make what he claims are necessary changes.

Galvin called for increased disclosure that would provide DC participants notice of the practice and the potential impact the delay could have.

None of the 28 providers contacted by Galvin's staff cooperated, citing confidentiality, questioning Massachusetts' jurisdiction or noting the fact that it is not a record keeper. Numerous firms which have never offered record keeping or exited the business years ago were contacted by Galvin’s office, including BlackRock, State Street, Invesco, Legg Mason, Ameriprise and Galliard. Meanwhile, large DC record keepers like TIAA-CREF, Aon Hewitt, Great West, Wells Fargo and Xerox (formerly ACS/Mellon) were not contacted at all. Fidelity, which was contacted, commented that only a small percentage of their 20,000 plans made the switch to lump sum, end-of-year payments.

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