ARE YOU A RETIREMENT PLAN FIDUCIARY?
A plan fiduciary is a person who is responsible for overseeing the company’s retirement plan. That person could be formally designated by the plan as a “named fiduciary” or is considered one based on the activities they perform.
THE PLAN FIDUCIARY’S RESPONSIBILITIES INCLUDE…
Under the Employee Retirement Income Security Act of 1974 or ERISA (the law that governs private workplace retirement plans), a plan fiduciary’s legal responsibilities include:
- Acting solely in the interest of plan participants and beneficiaries, with the exclusive purpose of providing benefits to them;
- Carrying out duties with skill, prudence and diligence;
- Following the plan documents (unless inconsistent with ERISA);
- Diversifying plan investments;
- Paying only reasonable expenses of administering the plan and investing its assets; and
- Avoiding conflicts of interest.
Fiduciaries must act prudently and in the best interest of the participants and beneficiaries which includes the selection and monitoring of the plan’s service providers.
Thankfully, by hiring a CEFEX certified TPA, retirement plan fiduciaries can rest assured that the TPA has already gone through a rigorous assessment, thus helping to fulfill their due diligence obligations.
HOW CAN THE CEFEX CERTIFICATION HELP PLAN FIDUCIARIES SATISFY THEIR DUE DILIGENCE OBLIGATIONS?
CEFEX CERTIFIED TPAs…
- Adhere to ethical sales practices
- Devote sufficient resources to protecting your plan’s Personal and Identifiable Information
- Disclose fees and services accurately and clearly
- Provide support for DOL and IRS audits
- Have a documented disaster plan that is annually tested for accurate data recovery
- Follow a consistent plan governance process
- Employ experienced staff to support technical retirement plan compliance questions
- Require staff to attend and pass Continuing Education courses
- Maintain sufficient errors & omissions insurance coverage
- Have a documented succession plan in place
- Ensure accuracy and compliance for your company’s retirement plan.
WHO IS CEFEX?
Founded in 2006, CEFEX, the Centre for Fiduciary Excellence, LLC, is an independent global certification organization. CEFEX works closely with qualified experts to provide comprehensive assessment programs that strive to improve the practices of investment stewards, advisors, recordkeepers, Third Party Administrators, and managers.
WHY SHOULD YOU PARTNER WITH A CEFEX CERTIFIED TPA?
CEFEX certified TPAs have voluntarily subjected their organizations to annual audits by an independent expert. They demonstrate transparency, integrity and adherence to the highest professional standards. They are capable of consistently achieving objectives and implementation procedures. Their documented processes provide assurance to fiduciaries that the industry’s best practices are being followed.
WHEN YOU PARTNER WITH A CEFEX CERTIFIED TPA FIRM, YOU ARE SELECTING AN EXPERT TO PROVIDE ADMINISTRATION SERVICES FOR YOUR PLAN, THEREBY REDUCING YOUR LIABILITY AND FULFILLING YOUR DUE DILIGENCE OBLIGATIONS.
For questions and additional information, please contact us directly and we will be happy to support.