First Allied Securities is ramping up its presence in the defined contribution plan space, said Guy Hocker, the newly hired senior managing director of the firm’s pension services division, in an interview Wednesday with AdvisorOne.
“First Allied has a vision of upgrading its presence in the 401(k) space,” Hocker said. “It’s recognition of the evolution that has occurred with defined contribution plans. I don’t have to tell you that it’s very timely to be asserting oneself in the retirement sector of the business.”
Hocker said he’s concentrating on advisor and client knowledge of 401(k)s and what they have to offer, but as a practical matter, a major priority is helping to ensure the individual advisors and affiliated RIA firms with which the broker-dealer partners are 408(b)(2) compliant.
According to the Department of Labor, in order to be 408(b)(2) compliant, plan fiduciaries are obligated to “act prudently” in selecting service providers and ensure that no more than reasonable compensation is paid for services provided to plans, taking into account the direct and indirect compensation received by the service provider.
“Thus, a plan fiduciary must have sufficient information regarding fees and compensation that the service provider receives and whether there are relationships or interests on the part of the service provider that may call into question the objectivity of the service provider in providing services to the plan,” according to DOL.