ABG Calls on DOL to Clarify Requirements of New Disclosure Regulations
PEORIA, Ill., May 1, 2012 /PRNewswire/ -- Alliance Benefit Group (ABG), one of the largest independent, full-service retirement plan providers in the country, is calling on the Department of Labor to clarify certain aspects of the new fee and expense disclosure regulations slated to go into effect this summer. Of particular concern is a provision of the 404(a)5 Disclosure Regulation that appears to require advisors to provide fee and benchmarking information for each Designated Investment Alternative (DIA) in a retirement plan.
According to this requirement, advisors would have to provide historical performance data, expense information, performance benchmarks, as well as a "sufficiently specific" URL containing pertinent information for every model portfolio in a plan. Generating this information would not only be onerous, but unfeasible for some model portfolios. For example, risk-based models, which allow investors to choose whether they want conservative, moderate, or aggressive asset allocations, often blend mutual funds together, making them extremely difficult to benchmark.
"We do not believe that the Department of Labor had any idea of the effective use many advisors and plan participants make of model portfolios in their plans," said John G. Hopkins, IV, CPC, and Executive Director of Alliance Benefit Group. "We have asked that the DOL provide specific clarification on whether DIAs will cover investment education services, investment services that implement education services, asset allocation models, and managed account services."
Given the complexity of the new regulations, including 404(a)5 and 408(b)(2), ABG, a national network of independent recordkeepers, has taken on the role of spokesperson for our advisor partners and plan sponsor clients. We are committed to partnering with financial advisors and providing participants with open architecture solutions. Our aim is to make compliance with the regulations as easy as possible.
About Alliance Benefit Group, LLC
Alliance Benefit Group, LLC is a national network of independently owned retirement plan consulting; investment advisory; health and welfare consulting; and benefits administration firms that operate as "Licensees" of Alliance Benefit Group, LLC. Collectively, Alliance Benefit Group is one of the largest retirement plan administrators in the country, providing administration services to over 13,000 plans representing more than $38 billion in assets and over one million participants. For more information, please visit www.abgnational.com.
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