On November 3, 2020, the U.S. Department of Labor’s Office of the Solicitor of Labor (the “DOL”) issued an opinion letter (the “2020 Letter”) to the Securities Industry and Financial Markets Association (“SIFMA”) stating that it would not view a conviction under foreign law as a disqualifying event under Prohibited Transaction Class Exemption 84-14 (the
Prohibited Transactions
Record-Keeper Defeats Second Round of Robo-Adviser Fee Litigation
By Lindsey Chopin on
As we reported here, record-keepers for large 401(k) plans have thus far been successful in defending ERISA fiduciary-breach litigation over investment advice powered by Financial Engines. These lawsuits generally claim that fees collected by record-keepers for investment advice were unreasonably high because the fees exceeded the amount actually paid to Financial Engines. Plaintiffs in…
First Round of Robo-Advisor Fee Litigation Goes to Record-Keepers
By Lindsey Chopin on
Since 2016, record keepers for large 401(k) plans have been defending litigation over investment advice provided by the Financial Engines investment advice algorithm. (This kind of arrangement is commonly referred to as “robo-advice.”) The lawsuits claim, in essence, that fees collected by record keepers for investment advice were unreasonably high, because the fees exceeded the…
Department of Labor’s New Fiduciary Rule Will Go Into Effect June 9th
By Benjamin Saper, Russell Hirschhorn & Seth Safra on
The Department of Labor has announced that the new fiduciary conflict of interest rule and related exemptions will begin taking effect on June 9, 2017, ending speculation of further delay. At the same time, the Department announced a relaxed enforcement standard for the rest of 2017. See our blog post on the delayed effective date…
DOL Fiduciary Rule Delayed, But At Least Parts Might Be Here to Stay
By Russell Hirschhorn & Seth Safra on
On April 4, 2017, the U.S. Department of Labor issued a final rule postponing applicability of the conflict of interest rule and related exemptions for sixty days, until June 9, 2017. The stated purpose of the extension is to allow more time to: (i) complete the examination required by President Trump’s February 3, 2017 memorandum,…
IRS Issues Temporary Enforcement Policy In Line with DOL FAB 2017-01
By Benjamin Saper & Russell Hirschhorn on
On the heels of the Department of Labor’s temporary enforcement policy concerning the DOL conflict of interest rule and related exemptions (see our blog post here), the IRS announced that it is providing relief from excise taxes under Code § 4975 that conforms to the DOL’s temporary enforcement policy described in FAB 2017-01. The…
Ameriprise Agrees to Pay $27.5 Million to Settle Fiduciary Breach and Prohibited Transaction Claims
By Joseph Clark on
Defendants Ameriprise Financial, Inc., the fiduciary committees of the Ameriprise 401(k) plan, and individual committee members agreed to settle a lawsuit brought by a class of participants in the Ameriprise 401(k) plan for $27.5 million.