Fiduciary Benchmarks Offering Services to UBS Advisers

Advisers in the DC Advisory program at UBS Financial Services Inc. will receive fee benchmarking services from Fiduciary Benchmarks, in partnership with BlackRock.

Advisers in the DC Advisory program at UBS Financial Services can obtain a benchmarking report for their clients or prospects by having the plan sponsor sign a form authorizing the benchmarking study. Fiduciary Benchmarks will then work with the plan’s recordkeeper to ensure that the data used for the benchmarking service is up-to-date, accurate, and consistent.  

Once the complete benchmarking report is received, BlackRock can help advisers better understand the report and highlight key opportunities to present to plan sponsors.  

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The announcement noted that demand for fee benchmarking services has increased significantly since the release of the interim final 408(b)(2) regulation on July 16, 2010, requiring the disclosure of fees and services related to retirement plans and is slated to take effect January 1, 2012.  

“There is a clear progression from transparency to disclosure to reasonableness to value. The 408(b)(2) regulation addresses transparency and disclosure. Our strength is in helping advisers and their plan sponsors get to reasonableness and value” said Craig Rosenthal, Senior Vice President in charge of Advisor Sales and Service at Fiduciary Benchmarks. “Reasonableness cannot be a fee-only discussion. Reasonableness can only be arrived at if you examine the support, services and success measures of your service providers. This is the value add service that FBI in partnership with BlackRock will be delivering to the UBS DC Advisory group.”  

More about the Fiduciary Benchmarks Service is at http://www.fiduciarybenchmarks.com.

"Impending Collapse" not Necessary to Rebut Presumption of Prudence

In an amicus brief filed on behalf of plaintiffs in Taylor v. KeyCorp, Secretary of Labor Hilda L. Solis explains her opinion.

The brief, filed in the 6th U.S. Circuit Court of Appeals says that the presumption of prudence does not apply or is rebutted whenever a fiduciary knowingly pays an inflated price for employer stock. Solis agreed with the district court’s decision that a plaintiff rebuts the presumption of prudence by showing that a prudent fiduciary would not invest in the stock under the prevailing circumstances, and plaintiffs are not required to plead additional allegations that the sponsoring employer was on the verge of a “drastic, extreme or impending collapse.”  

In addition, Solis wrote that the presumption is an evidentiary presumption, and as such, the district court also correctly concluded that the presumption did not provide grounds for dismissal at the pleading stage.  

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Solis also agreed with the district court’s holding that because “ERISA fiduciaries are liable for making misrepresentations in plan documents, they should also be prohibited from incorporating into plan documents other documents [including SEC filings] that make material misrepresentations about the company and then disseminating those misrepresentations to plan participants.”  

The district court, however, dismissed the case last year ruling that neither of the plaintiffs who brought the suit had suffered injury from their holding of KeyCorp stock in their plan accounts and, therefore lacked standing to sue (see “KeyCorp Stock Drop Case Dismissed“).  

The Secretary filed a separate amicus brief on January 12, 2011, in support of the plaintiff-appellant with respect to those issues.  

The current amicus brief is here.

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