Deals and People August 27, 2021

Retirement Industry People Moves

Rebalance hires retirement services director; Cuna Mutual Group selects new leadership; and TRA adds regional sales consultant. 

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Art by Subin Yang
Art by Subin Yang
Art by Subin Yang

Rebalance Hires Retirement Services Director

Wealth management firm Rebalance has added Nicole Cervi-McKeever as director of retirement services.

In the role, Cervi-McKeever works directly with Rebalance’s Better K small business 401(k) clients and is responsible for the entire 401(k) client lifecycle, serving as the daily  point of contact for all Better K clients.

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“Over the past year, our Better K business has grown exponentially, requiring us to increase the size of the team serving our small business 401(k) clients,” says Scott Puritz, managing director of Rebalance. “Given  her extensive experience both in the retirement services industry and as a customer service professional, we know that Nicole will be a great addition to the team. We look forward to introducing her to all of our Better K clients and know that their day-to-day needs will be taken care of in her capable hands.”

Before joining Rebalance, Cervi-McKeever worked for five years at CBIZ, where she served as a plan administrator. In  this role, she assisted in servicing close to 400 retirement plans and managed relationships with client plan sponsors, business owners, financial advisers and recordkeepers.

“I am passionate about providing a stellar customer service experience, which aligns perfectly with the mission  of Better K,” says Cervi-McKeever.

Cuna Mutual Group Selects New Leadership

Cuna Mutual Group has named Amy Cameron as the company’s new chief investment officer (CIO), effective September 13. She succeeds David Brown, who will retire in January. Cameron is currently the senior managing director for investments at the company. 

“Amy is a proven strategic thinker, investment expert and visionary leader,” says Robert Trunzo, president and chief executive officer of Cuna Mutual Group. “Her extensive expertise as an investment leader and broad investment acumen will bring even greater value to the consumers we serve.”  

Cameron will oversee $30 billion in assets under management (AUM) through the company’s investment portfolio and Members Capital Advisors, the registered investment adviser (RIA) affiliate of Cuna Mutual Group, to deliver long-term financial strength.

“Our responsibility as a mutual company and a long-term investor is to deliver financial strength and peace of mind to the many credit unions and members we serve,” Cameron says. “I’m grateful for the support I’ve had from Dave Brown and so many leaders at Cuna Mutual Group over the past 10 years, and I’m looking forward to helping our company continue to support our customers and grow for many years to come.”  

In addition to serving as managing director for investments at Cuna Mutual Group for the past decade, Cameron has held positions at Allianz of America, GE Asset Management and Metropolitan Life Insurance Co. She holds a master’s degree in business administration from the University of Connecticut and a bachelor’s degree in economics from the Villanova School of Business. Cameron is a Chartered Financial Analyst (CFA) charterholder.

The company has also named Anne Finucane as deputy chief investment officer, a new role to support the company’s growing portfolio. Finucane will support day-to-day management of the company’s investment efforts and will also begin her role September 13. 

“Anne brings a strong track record as a results-oriented leader investment leader,” Trunzo says. “Her broad based strategic and tactical acumen will be critical in moving this work forward.” 

Finucane currently serves as senior managing director and head of public asset classes at Cuna Mutual Group. Finucane graduated from the University of Chicago’s Booth School of Business, with a master’s degree in accounting and finance. She also holds a bachelor’s degree in economics from New York University. Prior to joining Cuna Mutual Group in 2016, Finucane held positions at Genworth Financial, Allianz of America, Citigroup and Schroders. 

Brown will retire after six years at Cuna Mutual Group and will continue in an advisory role through his retirement in January.  

TRA Adds Regional Sales Consultant

The Retirement Advantage Inc. (TRA) has hired Mark McCool as its latest regional sales consultant, providing sales consulting services to the southern New Jersey and Pennsylvania territory. McCool will report to Darin Erdmann, TRA’s national sales manager.

McCool is joining TRA from Lincoln Financial Group (LFG), where he operated as an internal retirement plan consultant. Before LFG, McCool held various positions with SEI Investments.

In his new role, he will be tasked with partnering with financial advisers and wholesalers to assist them in designing and implementing optimal retirement plan concepts for businesses of all sizes.

“Mark brings great energy and career experience in retirement plan solutions,” says Erdmann. “He has a great reputation for service, and we’re excited to welcome him to the TRA team. We are confident that his experience, leadership and ability to establish successful business partnerships will help TRA to increase retirement readiness for more U.S. plan sponsors and participants.”

“This is a great time to join TRA, with multiple new initiatives and a product road map in place that aligns with this continually growing market,” McCool says. “I am excited to be part of the team and honored to work for such a well-respected company in the financial services industry. I look forward to working with my business partners to help them find the best solutions that will meet the needs of their clients and help them achieve their goals.”

McCool will be replacing Bryan Foard, who will be taking on a national business development consultant role with TRA. McCool acquired his bachelor’s degree in civil engineering from Penn State University and holds the Financial Industry Regulatory Authority (FINRA) Series 7, Series 63, Series 65 PA Life and Health licenses, and the Fundamentals of Engineering (FE) certification. He resides in Pennsylvania.

Compliance August 27, 2021

Chamber of Commerce Says Cookie-Cutter Excessive Fee Suits Harm Participants

After pointing out the flaws in excessive fee allegations and what it says is the real motivation for the lawsuits, the agency asked the court in a case against the Red Cross to use careful scrutiny.

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The U.S. Chamber of Commerce has submitted a brief of amicus curiae (i.e., a friend of the court brief) to the U.S. District Court for the District of Columbia in an excessive fee case against the American National Red Cross. The Chamber of Commerce says the goal of its brief is to “aid the court’s consideration of the defendants’ motion to dismiss by providing context on recent trends in ERISA [Employee Retirement Income Security Act] litigation and how this case is situated in the broader litigation landscape.”

The chamber says the rapid increase in excessive fee litigation is not “a warning that retirees’ savings are in jeopardy,” but proof that converting “subpar allegations” into settlements has proven to be a lucrative endeavor for attorneys bringing the lawsuits.

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The amicus brief notes that the number of excessive fee suits “has exploded in the past 18 months,” culminating in more than 100 such suits filed in 2020 and many more filed this year. The chamber says the claims are not generally based on the details of a particular plan, but that, many times, lawyers “advertise for current or former employees willing to serve as plaintiffs and pursue the litigation, often with minimal communication with their clients during the process.” The brief also points out that the excessive fee cases originally focused on large corporate 401(k) plans, but have moved to include cases against smaller plans and nonprofits, such as the Red Cross.

The chamber also notes that the majority of cases have cookie-cutter complaints. Citing a motion to dismiss a lawsuit against the University of Miami, it says the complaint was “a literal copy and paste,” with its “allegations, right down to the typos … lifted directly from complaints in other cases about other plans offered by other universities, without regard for how (or even if) they relate” to the University of Miami’s plan.

The brief says attorneys’ incentives to file these lawsuits can be attributed in large part to two factors: First, they have become adept at using ERISA’s perceived complexity to evade dismissal, regardless of the quality of the allegations; and, second, given the cost of discovery and the inflated damages figures advanced by plaintiffs’ experts, there is often substantial pressure to settle if a case survives dismissal—again, regardless of the merits. “As a result, plaintiffs’ attorneys have been able to turn cookie-cutter allegations into lucrative paydays with plans of all shapes and sizes,” the brief says.

The chamber contends that plaintiffs’ attorneys often manufacture factual disputes to avoid dismissal and use the benefit of hindsight to second-guess the decisions of plan fiduciaries. The complaints often point to occasional periods of underperformance of certain funds or note that alternative, lower-fee options were available, but typically do not allege that the plan fiduciaries used a flawed process in making their decisions. Instead, the Chamber says, the lawsuits ask courts to infer that plan sponsors must have breached their fiduciary duties because they did not choose these alternative investments for their plan lineups.

“The attorneys then exploit the perceived complexity of ERISA’s statutory scheme to barrel past the motion-to-dismiss stage, resisting dismissal by claiming a dispute of fact even where their conclusory allegations are belied by publicly available data regarding performance and fees, or even by their own allegations in other lawsuits,” the brief says.

When a case survives dismissal, the chamber says plan sponsors have to choose between expensive and intrusive discovery or settling a case with large damage requests but minimal merit.

The chamber’s brief also says the surge of litigation has significant negative consequences for plan participants. Plan fiduciaries are being pressured to limit their investments to a narrow range of options at the expense of providing a diversity of choices with a range of fees, fee structures, risk levels and potential performance upsides, which ERISA expressly encourages, the chamber contends. In addition, the brief argues, given the lawsuits’ single-minded emphasis on cost, fiduciaries may forgo recordkeeping packages that include financial education, since that type of benefit could come with an additional cost.

The chamber points out that the increase in litigation has led to an increase in the cost of fiduciary liability insurance and made it more difficult to procure such insurance. This increased cost could lead large plan sponsors to make less generous employer contributions to their plans, and it could make employer contributions cost-prohibitive for small employers, the chamber says, adding that this goes against ERISA’s intent to encourage the offering of retirement plans to employees.

The chamber cites the Supreme Court’s influential 2014 ruling in Fifth Third v. Dudenhoeffer, which instructed courts to apply “careful, context-sensitive scrutiny” in order to “divide the plausible sheep from the meritless goats,” and the chamber says anything less than this careful scrutiny “would create precisely the types of negative consequences that Congress intended to avoid in crafting ERISA.”

“Amicus urges the court to adopt and apply that level of scrutiny to this case,” the brief concludes.

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