A great article appeared today in BenefitsLink called Retirement Plans Often Rife with Conflicts of Interest. In it, the author, Johnathan Broadbent, expresses consternation about the increasingly complex responsibilities of the retirement plan sponsor amidst the murky waters of conflicted arrangements. This issue is under constant consideration at Roland|Criss and it resonated deeply with us.
The retirement plan industry has long controlled the conversation. Service providers have dazzled plan sponsors with thick colorful binders with Velcro covers and pockets overstuffed with information, information, and information. They’ve hired teams of marketers to expertly craft every checklist, brochure, booklet, video, tutorial, website and report imaginable, but every one of us who works in the industry will admit, little if any of these costly resources have helped to increase the number of informed plan sponsor or participant consumers – at least not to the degree we may have expected – or hoped. Litigation continues to speak that truth to us. All of these marketing efforts may have served to increase revenue – but not preparedness – nor compliance. Forty one years since ERISA was enacted and the plan sponsors we serve are still struggling to make sense of it all. How can that be? I’ve been in this industry almost 20 years. Service providers have spent a fortune making life preservers and are tossing them into the water as fast as they can. So what gives? Well, the truth is, a life preserver still leaves plan sponsors and participants exposed – to the elements – to danger. Plan sponsors need a solid vessel and safe harbor!
Fee compression in the retirement plan industry is likely the culprit driving many service providers to what Johnathan is concerned about – “adding more and more services — such as payroll, mutual funds, trading, performance reporting, rollover IRAs, investment guidance and legal documents — all under one roof.” It’s getting more and more difficult for service providers to differentiate – to stand out. They are forced to expand…and contract. But the resulting conflicted models turn already muddy waters into quicksand. Before a plan sponsor even realizes it, they are neck deep into a conflicted model when they were only seeking simplicity and ease of administration.
Johnathan mentions “Let’s start by figuring out where all the hidden fees and conflicts of interest reside, and weed them out.” Roland|Criss pioneered the Vendor Value IndexTM (“VVITM“) – the first viable metric in the industry to measure the value that employees receive for the fees they pay their retirement plans’ service providers. The Vendor Value Index empowers Roland|Criss as an indispensable compliance resource, guiding plan sponsors to a vital safe harbor.
But for those who seek even greater protections, Roland|Criss’ Fiduciary GRC™ is the rescue vehicle of choice for plan sponsors who struggle with overall day-to-day plan administration – and all of the compliance requirements beyond the monitoring and examination of fees and service. Roland|Criss actually serves as an unconflicted 3(16) Plan Administrator and 402(a) Named Fiduciary.
Non-conflicted partners DO exist to help plan sponsors navigate their fiduciary duties and the complexities of the retirement plan industry. Roland|Criss is proud to be that partner to the plans and executives we serve. If you need help weeding out hidden fees and conflicts of interest in your plan – contact us today!
Kristi Arthur
