Fraud in a 401k Plan?

Some people think that 401k plans have little exposure to fraudulent activity.  The truth is, whenever there is an incentive, the opportunity, and the rationalization to commit fraud, then fraud should definitely be considered by your Company. The following risks, and mitigating recommendations, will be helpful to the following persons (but not limited to1): • Director …

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Planned Changes to the Regulatory Definition of Fiduciary

The Employee Benefits Security Administration (EBSA) plans to amend the regulatory definition of “fiduciary.” A large number of plan sponsors rely on the services of pension consultants and financial asset appraisers. As such, in June 2010, EBSA will propose to amend the current definition to include these service providers, essentially making them subject to the …

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Importance of Plan Amendments

With the ever changing regulatory landscape surrounding employee benefit plans, it’s important that the plan sponsor consider the impact of regulatory changes.  As discussed in previous blogs, there are a significant number of fiduciary responsibilities bestowed upon a plan sponsor.  One of these responsibilities is to keep the plan in compliance with all current laws …

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Establishing an Investment Committee for 401(k) Plans

Plan sponsors have a fiduciary responsibility to manage the investment options offered to participants. ERISA requires that these investments be monitored on an ongoing basis for appropriate use and continued prudence. In order to ensure this happens, plan sponsors should establish an investment committee to oversee and manage all investment processes for the plan. The …

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What is Compensation?

Compensation is key for 401(k)’s and other employee benefit plans. In many plans employees make contributions based on a percentage of their compensation. Other times, employer matching or profit sharing uses compensation as the basis for allocating employer contributions to employees. Compensation is generally defined as gross wages, which are subject to income tax withholding. …

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Basics About the Voluntary Fiduciary Correction Program

The Voluntary Fiduciary Correction Program (VFCP) is a voluntary enforcement program that encourages the correction of possible violations of Title I of the Employee Retirement Income Security Act (ERISA). Anyone who may be liable for fiduciary violations under ERISA, including employee benefit plan sponsors, officials, and parties in interest, may voluntarily apply for relief from …

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