- Those who are "named" in plan or trust documents
- Those whose function equates to providing comprehensive and continuous investment advice
- Those who have the discretion to buy and sell investable assets
- Those who have the authority to appoint other fiduciaries
Moreover, The Pension Protection Act of 2006 expanded the roles of a fiduciary, and gave plan sponsors more options to protect themselves as fiduciaries of the their company retirement plan. These protections are called "Safe Harbors".
According to Blane Akins, a blogger for Investments News as The Fiduciary, states:
For the protection of the fiduciaries and investors alike, it is better to address this issue up front, by properly identifying the fiduciaries, documenting their status and role in the investment policy statement, and requiring the fiduciaries to acknowledge their status in writing. Not only will this help prevent misunderstandings, it ensures every step in the investment process is accounted for and that the fiduciaries are taking the proper steps to fulfill their role.
Heads of HR, small business owners, CEOs and CFO's that control the assets of their company retirement plan should not believe that the plan record keepers and custodians (i.e Fidelity, Schwab, Vanguard or The Principal, etc.) or their investment representative have taken the proper steps to protect you as a fiduciary. Any lawsuit that arises from any participants dissatisfaction with your company retirement plan puts you directly responsible and your personal assets.
Do not assume this responsibility is taken care of. Take the steps that are necessary to ensure that you are protected from potential lawsuits that might be looming. The best way to do this is to educate your investment committee or hire a professional fiduciary consultant. Resources like fi360.com is perfect place to start. Remember taking these crucial steps will only enhance the overall effectiveness of your company's retirement plan
By David A. Mascio
