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Plan Sponsor Considerations When A Recordkeeper Is Sold

2021 
By Fred Reish

When the plan sponsor’s 401(k) recordkeeper is sold, the plan’s fiduciaries have a duty to evaluate the impact this change may have on the plan and its participants.


Fred Reish is an ERISA attorney whose practice focuses on fiduciary responsibility, retirement income, and plan operational issues. He has been recognized as one of the “legends” of the retirement industry by both PLANADVISER magazine and PLANSPONSOR magazine.


It is well-known that 401(k) fiduciaries have to prudently select and monitor service providers, including recordkeepers, for their plans. As the Department of Labor (DOL) explained in its brochure, “Meeting Your Fiduciary Responsibilities”:

An employer should establish and follow a formal review process at reasonable intervals to decide if it wants to continue using the current service providers or look for replacements. When monitoring service providers, actions to ensure they are performing the agreed-upon services include:



The views expressed here are those of Fred Reish. They should not be construed as investment advice or as the views of Hartford Funds or the employees of Hartford Funds. They are based on available information and are subject to change without notice. The information above is intended as general information and is not intended to provide, nor may it be construed as providing, tax, accounting or legal advice. As with all matters of a tax or legal nature, please consult with your tax or legal counsel for advice. This material and/or its contents are current at the time of writing and may not be reproduced or distributed in whole or in part, for any purpose, without the express written consent of Fred Reish.

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