Department of Labor Releases Fiduciary Rule for Banks
ERISA safeguards plan participants by imposing trust law standards of care and undivided loyalty on plan fiduciaries, and by holding fiduciaries accountable when they breach those obligations.
However, this final rule will extend those standards to cover an adviser who can be an individual or entity who is, among other things, a bank.
The final regulation now includes banks when 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 or beneficiaries.
Fiduciaries to plans and Individual Retirement Account(s) are not permitted to engage in “prohibited transactions,” which pose special dangers to the security of retirement, health, and other benefit plans because of fiduciaries’ conflicts of interest with respect to the transactions.
Keeping your financial institution up to date on regulatory issues and your employees educated can be a daunting task. TRC can help. To learn more and the details of ERISA, contact us at firstname.lastname@example.org or (800) 222-9909.