Compliance May 24, 2018

DOL Announces Fiduciary Responsibilities Seminar in Chicago

Its “Getting It Right – Know Your Fiduciary Responsibilities” seminar will be held in Chicago, on July 10.

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The Department of Labor (DOL) Employee Benefits Security Administration (EBSA) announced its “Getting It Right – Know Your Fiduciary Responsibilities” seminar will be held in Chicago, on July 10.

The compliance assistance program will increase awareness and understanding about basic fiduciary responsibilities when operating a retirement plan.

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Topics to be covered in the seminar include:

  • Understanding your plan and your responsibilities;
  • Carefully selecting and monitoring service providers;
  • Making contributions on time;
  • Avoiding prohibited transactions; and
  • Making appropriate disclosures to plan participants and filing annual reports to the government on time.

More information and a link to register are here.

The DOL previously announced its seminar will be held in Providence, Rhode Island, on June 28.
Compliance May 24, 2018

Settlement Preliminarily Approved in University of Chicago Excessive Fee Suit

According to the settlement agreement, the university has already made changes to the investment lineup for its 403(b) plans.

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Without admitting any wrongdoing, the University of Chicago has agreed to a $6,500,000 settlement of an Employee Retirement Income Security Act (ERISA) excessive fee case.

The original case alleged violations for both the University of Chicago Retirement Income Plan for Employees (ERIP), a plan for faculty and staff members, and the University of Chicago Contributory Retirement Plan (CRP), a plan for non-academic employees. In addition to various counts regarding excessive fees, the complaint accused the university of approving a TIAA loan program that required excessive collateral as security for repayment of the loan, charged grossly excessive fees for administration of the loan, and violated U.S. Department of Labor (DOL) rules for participant loan programs.

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Last fall, U.S. Chief District Court Judge Ruben Castillo of the U.S. District Court for the Northern District of Illinois dismissed claims related to the CRP and the TIAA loan program because the plaintiffs were not participants in the CRP plan nor did they participate in the TIAA loan program. The judge also at the time dismissed the claims for failure in the duty of loyalty under ERISA, saying the plaintiffs did not show that the defendant engaged in any self-dealing or failure to communicate material information.

The case was reinstated in January after a new motion was filed with a new named plaintiff.

According to the settlement agreement, which has already been preliminarily approved by the judge, but is awaiting final approval, the university has agreed to structural changes to its 403(b) plans. The University of Chicago agrees not to increase per-participant recordkeeping fees for three years from the date of final approval of the settlement and to use commercially reasonable best efforts to continue to attempt to reduce recordkeeping fees.

Effective April 2, 2018, the university implemented a new investment lineup for its 403(b) plans that reduced the total number of investment options and eliminated the CREF Stock Account as an investment option available to plan participants. However, the TIAA Real Estate Account will continue to be available as an investment option.

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