New 408(b)(2) Compliant Engagement Contracts Will Expose the Industry’s Hidden Fees

By Yariel Chiong 
With the Department of Labor’s (DOL) regulation coming into effect this January 1, 2012 ACI has revisited its engagement contract to go above and beyond the requirements set by the DOL 
 

With the passing of 408(b)(2), plan sponsors will for the first time know what their third party administrator (TPA) and other vendors to their retirement plan have been keeping from them in revenue sharing or hidden fees. ACI has been an industry leader disclosing all fees and distributing revenue sharing to clients for some time now. ACI discloses indirect and direct compensation to its clients, returning 80% of revenue sharing to clients, keeping 20% only to offset the cost of the accounting required to distribute the monies.
 
As a “responsible plan fiduciary” you must ensure that you review and understand all vendors’ contracts raising any questions you may have to them. Vendors are required to send you a 408(b)(2) compliant agreement contract which among various other things must:


1. Clearly describe the services provided to you


2. State all fees charged to the plan sponsor


3. Disclose any direct and indirect fees received


Click here for a link to the Spring Issue of The ASPPA Journal for more information on what you should find in your service agreement from your Third Party Administrator.

ACI has been certified with CEFEX for the last 3 years and currently holds the Service Provider Seal mentioned in the article. As a responsible fiduciary, working with a certified TPA makes sense. You can rest assured that your agreement goes above and beyond the DOL’s requirements and that your plan will not become disqualified. Contact us to find out more information or to have an in-depth review of your plan.

ACI RENEWS ASPPA RECORDKEEPER CERTIFICATION- STILL IN A CLASS OF OUR OWN

By Yariel Chiong

The Department of Labor (DOL) defines who is considered a Fiduciary to the plan and their responsibilities to plan participants and beneficiaries. As a responsible fiduciary, one of the most important responsibilities is to select a service provider for the plan, gathering information about their business practices and quality of service.

ASPPA and CEFEX have partnered to offer third party auditing of service providers which helps plan sponsors assess the competency of their Third Party Administrators.

ACI has recently undergone the renewal of our ASPPA Recordkeeper Certification. We still maintain as being the only ASPPA Certified Recordkeeper in California. This is a testament to our dedication to our clients and advisors in offering them a firm which is:

1. financially sound
2. following fee disclosure guidelines under the DOL’s proposed 408(b)(2) regulation
3. trustworthy and ethical in its business practices
4. reducing risk for the plan sponsor and their employees
5. using secure IT systems
6. defining quality control and management systems with clear processes and procedures

The certification closely resembles the ISO 9000 certification given to manufacturing firms and is performed by an outside auditing firm. ACI has gone through extensive reviews with 17 critical practices and over 100 separate criteria all to ultimately give our clients peace-of-mind.

Contact an ACI Consultant or Administrator to learn more about why you should be working with an ASPPA Certified Third Party Administrator such as ACI. The proof is in our quality staff and their work.