Getting your clients, especially smaller plan sponsors, to pay attention to the litigation risks of DC plans can be hard, even in the wake of recent wins by plaintiffs. A recent article in CFO.com may help you get the attention of clients and prospects. The article features a list of seven best practices for plan sponsors:
- Act like the money in the plan is your own — in other words, take the time to understand the fees.
- Keep the focus on the participant and avoid self-dealing.
- Benchmark, benchmark, benchmark.
- Beware of bundling.
- Beware of revenue sharing.
- Don’t float.
- Don’t pay retail — negotiate.
Though plaintiff’s attorneys are most likely to focus on larger plans, DOL auditors aren’t. And class action lawsuits make even the smallest plan sponsors vulnerable. Either way, what’s wrong with doing the right thing and following best practices? Isn’t that why your clients hired an experienced plan advisor?
