BidMoni Small Market Solution Webinar Replay
BidMoni has partnered with five national Recordkeeping firms and one national TPA firm to create the first ever fully digital 401K marketplace. We have worked with advisors across the country to remove the friction points in selling smaller plans, including:
- Identifying opportunities
- Generating proposals
- Running plan comparisons
- Plan onboarding
What is a 3(16)? Why should advisors be partnering with independent 3(16)'s to grow their practice? View our webinar replay with guests Jim Sharp and Russell McNorton to learn more!
Advisors should take care of their own plans and advise clients about this growing problem.
By Alison L. Martin | June 25, 2020 at 09:30 AM
Almost every employer sponsoring a retirement plan should to be mindful of potential fiduciary liability under the Employee Retirement Income Security Act of 1974 (ERISA).
According to an article published by the America Bar Association, between increased regulatory scrutiny by the Department of Labor and private litigation brought by the ever-expanding plaintiff’s bar, ERISA lawsuits are at an all-time high.
One of the most significant ERISA litigation trends is “excessive fee claims.” In a nutshell, these allege that a retirement plan’s fiduciaries allowed the plan to overpay for recordkeeping and use expensive and underperforming investments. These claims can cost millions of dollars to defend, and settlements can reach tens of millions of dollars.
A financial services company that sponsors a retirement plan may be sued, along with its executives, for excessive fee claims even when they don’t provide any professional services to the plan.
This is because, as plan fiduciaries, they have a duty to ensure that plan fees and investments provided by third parties are reasonable. Moreover, pursuant to ERISA, plan fiduciaries may be personally liable for these losses and the plans do not provide indemnification for them.
What About Smaller Plans?
Although these claims were historically filed against fiduciaries of large plans, the last few years have seen an uptick in lawsuits against fiduciaries of smaller plans, including plans well under $100 million in assets.
It’s apparent that fiduciaries of smaller plans should no longer consider themselves immune from litigation risk.
With a surge in litigation, it’s important that all advisors, regardless of their or their client’s plan size, understand the recent trends pertaining to excessive fee claims and the characteristics that may make them more susceptible to litigation.
What can they do to protect themselves? Of course, plan fiduciaries should always act with care andundivided loyalty to the plan and its participants. And while there’s no foolproof way to avoid an excessive fee claim, there are a few steps that may help reduce exposure:
Click here to view the entire article via ThinkAdvisor.
March 25, 2020
Coronavirus (COVID-19) Regulatory Resources for Employee Benefit Plans
The past week has brought an onslaught of changes for the world, including changes in U.S. federal legislation to address the COVID-19 pandemic.
ComplianceDashboard has compiled a list of resources we feel may aid your everyday. The resources provide access to the following:
- COVID-19 information for advisers and employers.
- A summary of the Families First Coronavirus Response Act (FFCRA).
- A list of state websites where businesses and individuals may access state-specific guidance regarding legislation and government actions.
- Links to federal agency sites including CMS, DOL, and IRS.
- A listing (by most recent date of release) of articles from reputable sources re: employer considerations for benefit plans.
Click here to continue reading the full ComplianceDashboard Resource List.
ABB, Workers Get Early Approval for $55M 401(k) Settlement
Posted April 3, 2019, 1:08 PM
Landmark settlement in the longest running Erisa lawsuit, what were the conclusions:
- Recordkeeping fees were excessive causing losses to participants (failure to bid and monitor service providers).
- The plan replaced funds with proprietary, underperforming funds offered by the recordkeeper.
- Indirect revenue received from funds must be paid back to plan participants.
This creates a foundation for breaches and penalties moving forward. Advisors and firms are going to be forced to change their way of doing business.
Click here to read the full story.
The following article was featured on Financial Advisor Magazine.
AUGUST 19, 2019
1. How did you personally become involved in fintech and what do you do on any given day?
Like many entrepreneurs, I found myself facing a challenge in my business. There are so many opportunities to grow a successful financial advisory practice today. Advisors are inundated with product offerings, and with growing regulatory scrutiny it is increasingly difficult to operate efficiently. I wanted to create something that would improve both the workflows of fiduciary advisors and the outcomes of retirement plan participants.
As co-CEO I wear many hats and am very fortunate to have a strong experienced team surrounding me. We are constantly improving our technology—setting that agenda and vision is critical. I manage all of the recordkeeper relationships on our platform and my co-CEO and partner, Michael Steffan, has been focused on growing our footprint with advisors.
2. What does your firm do/offer within the fintech sector?
Fiduciary Shield by BidMoni is an end-to-end fiduciary technology serving 401(k) advisors. 401(k) Prospector is a feature that identifies fiduciary risk factors on more than 800,000 plans. Advisors can geolocate plans, search by employer, search for service providers and even identify plan decision makers and connect with them via LinkedIn.
Advisors can request proposals from more than 20 recordkeepers through BidMoni's Fiduciary Shield platform. Advisors are able to download and analyze proposals with a simple and transparent interface. Automated plan monitoring reports are issued quarterly to help advisors and plan sponsors meet their ongoing requirement to monitor plan fees. All proposals, reports, forms and important documents are stored securely to help plan fiduciaries meet their obligations under ERISA.
3. How do you feel consumers (or if more relevant for your firm – businesses) are adapting to the facet of fintech that your company operates within?
A recent survey by the National Association of Retirement Plan Participants revealed that only 16% of participants trust financial advisors. The top driver of trust is fee transparency. Pairing transparency with a process that drives better fee results is a no brainer. Employers and advisors utilizing BidMoni's Fiduciary Shield platform are very pleased with the simplicity in which critical fiduciary data is presented and how easy it is to make an informed decision.