Compliance May 25, 2010

Law Firm Investigates Transocean’s Handling of Company Stock

Law Offices of Howard G. Smith is investigating potential claims against Transocean Ltd. concerning whether the company’s 401(k) savings plans imprudently invested in Transocean stock.
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The law firm announced it is investigating whether the plans’ administrators breached their fiduciary duties in violation of the Employee Retirement Income Security Act (ERISA). The investigation concerns public statements issued by Transocean between August 5, 2009, and May 7. 

According to the firm’s announcement, a pending shareholder lawsuit claims that during that period Transocean and certain of its executive officers failed to disclose and/or misrepresented the effectiveness of Transocean’s safety protocols, recurring problems with blowout preventers (BOP)—including BOPs installed on the Deepwater Horizon mobile drilling platform that is currently at the center of a massive oil spill in the Gulf of Mexico—and the company’s operating and safety record.  

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The law firm said it is investigating whether Transocean and other administrators of the plan failed to prudently and loyally manage the plans’ investments in Transocean stock by continuing to offer company stock when the stock was no longer a prudent investment.  

Data & Research May 25, 2010

Study Finds HSA Balances Getting Bigger

A study by J.P. Morgan found that health savings accounts with higher cash balances are becoming more common.
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J.P. Morgan’s HSA Program Snapshot found that 45% of health savings accounts (HSAs) had balances over $1,000 at the end of 2009, compared to 35% at the end of 2008. The percentage of accounts with balances under $500 decreased from 50% at the end of 2008 to 42% in 2009. The percentage of accounts with balances over $2,000 increased from 20% at the end of 2008 to 31% in 2009.  

Nearly seven-in-10 accountholders (68%) contributed more than they spent during each month in 2009. The average account contribution in 2009 was $1,816. 

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In addition, the analysis found most transactions (70%) are sign for purchase transactions done via a card.  

The average amount distributed for benefits from HAS accounts in 2009 was $1,305, or $109 per month. According to J.P. Morgan, while purchases at drugstores resulted in the highest volume of transactions per account, hospitals and dental expenses had the highest average dollar amount per transaction ($212 and $194, respectively).  

Most HSA investment dollars were held in equity mutual funds (52%).

The Snapshot report is based on 2009 activity of more than 500,000 HSA account holders. The full report can be downloaded here.  

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