Reacting to recent news about the practice of companies like AOL and IBM withholding matching contributions until after the end of the year, William F. Galvin, Massachusetts’ secretary of the commonwealth and chief securities regulator, has sent a request to the top 25 401(k) providers about the number of companies that have made the switch, Bloomberg BusinessWeek reports.
Concerned that participants are being shortchanged by the practice, Galvin is trying to determine how many people have been affected. Not only do people lose out on gains throughout the year, but they have to stay until after the end of the year to receive the match.
Though Galvin hopes that his inquiry will raise awareness, he is not optimistic that it will result in legislative change because of "dysfunction" in the federal government.
