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Compliance October 2, 2007
House Panel Sets Hearing on Miller 401(k) Fee Disclosure Measure
October 2, 2007 (PLANSPONSOR.com) - The U.S. House
Education and Labor Committee will hold a hearing on Thursday
to discuss a proposal requiring greater 401(k) fee disclosure
by plan sponsors and providers.
Reported by Adrien Martin
The 401(k) Fair Disclosure for Retirement Security Act of 2007 was proposed by Representative George Miller (D-California), the committee’s chairman, in July (See Representative Miller Introduces Fee Disclosure Legislation ). At a committee meeting in March, Miller said thatworkers are “simply not in a position to compare plans” and that improving “401(k) transparency is just the beginning of our efforts to ensure that all American have access to a secure retirement.”
Pension industry groups soon weighed in, most of which criticized Miller’s plan as burdensome on plan sponsors with too little real benefit to plan participants, some even arguing that too much disclosure could actually thwart retirement savings efforts (See Retirement Groups Weigh in on Miller Fee Disclosure Proposal ).
A SPARK Institute analysis most recently suggested that fee information is arguably not the most important point participants should consider when they are making investment decisions and also suggested that an over-emphasis on fees and expenses could actually lead to poor investment decisions (SeeSPARK: Fee Disclosure Proposal Too Burdensome).
Some also made arguments that fee disclosure was the job of the Department of Labor or the Securities and Exchange Commission (See DoL Asks For Advice on 401(k) Fee Disclosures , SEC Turning its Attention to 12b-1, 401(k) Disclosures).
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