More On Legal & Compliancefrom The Advisor's Professional Library
- Risk-Based Oversight of Investment Advisors Even if the SEC had a larger budget and more resources, it is doubtful that the Commission would have the resources to regularly examine all RIAs. Therefore, the SEC is likely to continue relying on risk-based oversight to fulfill its mission of protecting investors.
- RIAs and Customer Identification Just as RIAs owe a duty to diligently protect their clients privacy and guard against theft, firms also play a vital role in customer identification. Although RIAs are not subject to an anti-money laundering rule, securities regulators expect advisors to address these issues in their policies and procedures.
The Department of Labor’s (DOL) Employee Benefits Security Administration (EBSA) announced Friday that it has set up a new online filing system for plan sponsors seeking fiduciary relief for a service provider’s failure to comply with the department’s plan-level fee disclosure rule, 408(b)(2).
The new online tool, which replaces the option of e-mailing notices, “will better assist plan sponsors who file electronically by ensuring that all required information is submitted, and providing immediate confirmation that notices have been received by the department,” EBSA says.
Phyllis Borzi, Assistant Secretary of Labor for EBSA, said in a statement that the revised submission procedures “should provide plan sponsors a greater level of confidence that their requests for fiduciary relief have been received and will be efficiently processed and reviewed.” The easy-to-use online filing system “guides plan sponsors through the information that must be submitted, and allows us to more quickly process and respond to their requests,” she said. “We’ve also retained flexibility for those plan sponsors who choose to submit paper notices.”
The final service provider-to-plan sponsor fee disclosure rule, referred to as the 408(b)(2) regulation for the relevant section in the Employee Retirement Income Security Act (ERISA), became effective on July 1. It includes a provision to protect plan sponsors, or other responsible plan fiduciaries, from liability for a breach of their fiduciary duties under ERISA when, without the plan sponsor’s knowledge, a service provider fails to comply with the rule’s comprehensive disclosure requirements.
As EBSA explains, “if a plan sponsor discovers that required information has not been furnished, and efforts to obtain the information are not successful, the sponsor must notify the department, by regular mail or electronically.
Plan sponsors who want to send paper notices can now submit them to a dedicated P.O. box address, rather than to the department’s general mailing address. Notices can be addressed to: U.S. Department of Labor, Employee Benefits Security Administration, Office of Enforcement, P.O. Box 75296, Washington, D.C. 20013.