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Final DOL Fiduciary Rule – Q&As for Employers and Plan Sponsors on Investment Education

May 3, 2016

Tuesday, May 3, 2016 | National Law Review

On April 6, 2015, the U.S. Department of Labor (Department) issued its final rule defining who is a fiduciary of an employee benefit plan under the Employee Retirement Income Security Act of 1974 (ERISA) as a result of giving investment advice to a plan or its participants and beneficiaries. The final rule (available here) offers a definition of fiduciary investment advice that expands the group of people who would be considered fiduciaries.

In our April 19, 2016 client alert (available here), we provided a summary of the final rule. In this client alert, we address many of the questions employers/plan sponsors have about the new rule and whether they or their employees may be deemed to be investment advice fiduciaries in connection with providing investment information to plan participants and beneficiaries.

As discussed below, employers and plan sponsors should consider reviewing their policies and procedures for providing investment information to make sure they have not crossed the line into providing investment advice, thus becoming “investment advice” fiduciaries under ERISA.

Q1.   What is investment advice?

A1.   The rule emphasizes that investment advice must be in the form of a recommendation. Investment advice is a recommendation:…

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Matthew C. Strife
Blue Vault Services
April 11, 2016

Blue Vault's services are without question great resources for the review of the nontraded products offered.