Compliance August 30, 2010

California Law Firm Probes Possible Fiduciary Breach

A Los Angeles-based law firm has launched an ERISA-based fiduciary investigation of Northern Trust.  
Reported by

Liner Grode Stein Yankelevitz Sunshine Regenstreif & Taylor LLP (“Liner”) says it has commenced an investigation relating to The Northern Trust Company Thrift-Incentive Plan, and potential violations of the Employee Retirement Income Security Act of 1974 concerning investments in the stock of Northern Trust Company, and proprietary funds selected by that plan’s fiduciaries to be included in the plan.

Investigation Focus

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According to a press release, Liner’s investigation focuses on concerns that the plan’s fiduciaries may have breached their fiduciary duties of loyalty and prudence to the Plan’s participants.  They claim that a breach may have occurred if the fiduciaries “failed to prudently manage the plan’s assets, by among other things, offering Northern Trust stock and/or proprietary funds as plan investment options, requiring participants to invest in the company stock, and investing and holding company contributions in the company stock at a time when the stock was not a suitable and appropriate investment option”.

The law firm says that a breach also may have occurred if the fiduciaries withheld or concealed material information from the plan’s participants “with respect to the company’s business, financial results, and operations, thereby encouraging participants and beneficiaries to continue to make and maintain substantial investments of company stock in the plan”.

Liner notes that its attorneys “helped pioneer this field in the Rite-Aid and McKesson ERISA breach of fiduciary duty cases, among the first large-scale ERISA 401(k) cases filed”.

More information is available at http://www.californiaclassaction.com/.

 

Deals & People August 30, 2010

The Hartford Attempts to Gain Ground in Mid-Market

With the introduction of several new initiatives and a new VP, The Hartford Financial Services Group plans to grow their middle market business for 401(k) defined contribution and defined benefit retirement plans.
Reported by

Denise Diana will be spearheading the effort, as vice president, retirement plans, mid-market. Diana has been tasked with creating a new team of middle market specialists to support financial advisers, registered investment advisers (RIA), and consultants. 

Part of this support will be conveyed in a series of forums for advisers that will unveil research on retirement plan sponsors’ and participants’ evolving needs, and new approaches in meeting them. The forums, “A Dose of Reality: Strong, No Sugar,” will consist of practice management modules and insights into The Hartford’s new techniques. The seminars will take place in Boston, Atlanta, Irving, TX, and San Francisco.

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“The Hartford has been building its considerable capabilities to serve the middle market for some time, including three strategic acquisitions that expanded our scale and core competencies,” said Sharon Ritchey, executive vice president and director of The Hartford’s Retirement Plans Group (see “Hartford Shakes Up Wealth Management Unit” ). “We’ve added new technology capabilities, new product solutions for both defined contribution and defined benefit plans, and new leadership to help us accelerate growth.”

Diana comes to The Hartford with 20 years of experience in the insurance industry, most recently from Transamerica where she was vice president of business development (see “Transamerica Bolsters B/D Channel Management Team“). She has also held key leadership positions at Prudential Retirement and CIGNA.
 

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