Officials at the U.S. Department of Labor intend to expand ERISA’s definition of a plan fiduciary to include pension consultants and other investment advisers.
Under the current rules, which have been in effect since 1975, consultants and providers of investment advice are generally not considered fiduciaries unless they exercise discretionary authority or control over a plan’s investment transactions or meet a five-part standard.
According to a fact sheet posted on the DOL’s Web site, this definition “limits ERISA’s ability to protect employee benefit plans from advisers and financial asset appraisers that act imprudently, or subordinate their clients’ interests to the interests of others,” and should be expanded to provide greater protection.
The DOL plans to propose a regulation expanding the definition in June, according to the fact sheet.
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