Compliance July 29, 2008

DoL, SEC Ink Information Sharing Pact

The U.S. Department of Labor (DoL) and the U.S. Securities and Exchange Commission (SEC) signed a memorandum of understanding pledging to continue sharing information about retirement plan investments.
Reported by

A joint announcement released today said the agreement between the agencies sets out an information-sharing process between the DoL’s Employee Benefits Security Administration (EBSA) and SEC staff to meet regularly to discuss areas relating to retirement plan investing that fall under each agency’s jurisdiction. The DoL has oversight over 401(k) and other retirement plans as well as plan participants, while the SEC oversees, among other areas, brokerages, investment advisers, and mutual funds.

According to the announcement, the joint DoL-SEC conferences will touch on:

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  • examination findings and trends,
  • enforcement cases,
  • regulatory requirements that impact the missions of both agencies.

Both agencies will designate points of contact in their regional offices to facilitate communications. The agreement will expedite the sharing of non-public information regarding investment advisers and other subjects of mutual interest between the two agencies.

The DoL and SEC said they will cross-train staff with the goal of enhancing each agency’s understanding of the other’s mission and investigative jurisdiction.

The memorandum of understanding is available here.

Compliance July 29, 2008

UBS Now Faces 401(k) Plan Investigation

Holzer Holzer&Fistel, LLC, is investigating possible violations of the Employee Retirement Income Security Act (ERISA) related to UBS AG's 401(k) plan.
Reported by

According to a release, the investigation centers on whether UBS and plan administrators breached their fiduciary duties to plan participants by, among other things, making imprudent investments in company stock and otherwise failing to prudently and loyally manage the plan’s investments.

The bank also faces lawsuits by three states claiming it committed fraud by misleading investors in its marketing of auction-rate securities as liquid instruments that were easy to buy and sell (see NY Next to Target UBS). On Monday, reports surfaced that the bank suspended its head of fixed income in the U.S. and global head of municipal securities, David Shulman (see UBS Benches Fixed Income Head Amid Auction-Rate Probes).

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