Did you know you are a fiduciary?

Plan sponsors like you are, by definition, a fiduciary of your plan because you exercise control over, and act on behalf of, your plan.

When it comes to the topic of fiduciary responsibilities for qualified retirement plans, there are three things we know really well:

  • Plan sponsors like you are, by definition, a fiduciary of your plan because you exercise control over, and act on behalf of, your plan.
  • Some plan sponsors don't know this even though we try to do our best to make this clear.
  • There are real and serious consequences for you as the plan sponsor if you're not aware and fail to execute your fiduciary role properly.

There are some pretty reasonable explanations about why this happens. One is that despite our effort to share important information about what a fiduciary is and what responsibilities the role carries, experience tells us that there's frequently a gap between what we try to communicate and what our busy clients actually hear and understand. Another explanation is that sometimes people mistakenly think their service providers are fiduciaries and they are not. A third explanation is they may think that because they've elected to outsource some of their responsibilities to professionals, that they are no longer fiduciaries or liable for the performance of the plan.

This is clearly a case of what you don't know can hurt you. Our mutual goal, of course, is to keep your plan compliant and on track. So, in advance of our next meeting, it might be helpful to give this topic some thought. We suggest reviewing the fiduciary status of all service providers to whom you've outsourced some or all of your plan oversight tasks. This may reveal issues to be addressed and will certainly provide more clarity in your understanding of your fiduciary role and responsibilities.

Questions?

Contact Brad Bechtel using the information below about how we can work together to help you meet your obligations, avoid problems, and keep your plan compliant and on track for long-term success.

Brad Bechtel

Senior Vice President
Employee Benefit Services

Brad Bechtel leads AGH’s employee benefit services (EBS) division, which serves clients nationwide. EBS is one of the region's largest providers of retirement plan recordkeeping services for daily valuation plans. The division provides consulting services to clients on employee benefit plans, including plan design, implementation, operation, fiduciary due diligence, compliance, and through affiliate AGH Wealth Management, discretionary and non-discretionary investment fiduciary services, investment advisory services and employee education.

Bechtel is experienced in executive compensation, including non-qualified, phantom stock, top hat and excess benefit plans, as well as other deferred compensation approaches. He has consulted for numerous Fortune 500 corporations on investment management and fiduciary due diligence. He also provides search and selection due diligence consulting services for companies seeking new investment and recordkeeping providers for their qualified plans. Bechtel is a registered investment advisor who holds Series 7, 24 and 66 FINRA registrations, and he is a member of the American Society of Pension Professionals & Actuaries.

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