Deals and People May 6, 2016

Retirement Industry People Moves

Wells Fargo Announces Leader of Participant Services; Ascensus Appoints Retirement COO; UBS Hires Head of Institutional Client Relationship Management.
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Jon Graff has joined Wells Fargo Institutional Retirement and Trust to lead its Participant Services team.

As director of Participant Services, he will provide leadership for participant communications, education, and advice for more than 3.4 million defined contribution participants to help them prepare for a better retirement.

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Graff comes to Wells Fargo with 22 years of industry experience having served in several retirement industry leadership positions including marketing, relationship management, and operations. He most recently served as managing director at Charles Schwab, where he led a team of marketing professionals focused on client retention and organic growth through active engagement of plan sponsors and participants. Previously, Graff spent 19 years at Fidelity Investments where he held numerous leadership positions.

He has a B.S. in Economics from Holy Cross College in Worcester, Massachusetts, and an MBA from the University of Connecticut.

“Jon has a proven track record of success that has been achieved through a focus on cross-functional partnership and a thorough mastery of this complex industry,” says Joe Ready, director of Wells Fargo Institutional Retirement and Trust. “This background will enable him to propel our work to help drive better outcomes for participants.”

NEXT: Ascensus Appoints Retirement COO

Ascensus has appointed Rick Irace as chief operating officer (COO) of the company's retirement division.

In this newly created role, Irace will be responsible for Ascensus' retirement service and operations teams.

Prior to joining Ascensus, Irace served as managing director and head of institutional retirement and benefit plan relationship management and communications consulting for Bank of America Merrill Lynch. He was responsible for delivering integrated benefits and investment solutions to mega- and large-market companies, including proprietary 401(k), non-qualified deferred compensation, and defined benefit plan administration. His team was also responsible for providing strategic expertise, thought leadership, and best practice communication solutions to enable plan sponsors to promote the value of their plans and help plan participants achieve financial wellness.

Previously, Irace served as head of integrated benefit solutions, where he first developed a relationship with Ascensus. Rick connected with members of Ascensus' adviser network first-hand and was introduced to the company's sales and service model.

Irace earned a bachelor's degree from Monmouth University in Long Branch, New Jersey, and holds FINRA Series 7 and Series 24 certifications.

NEXT: UBS Hires Head of Institutional Client Relationship Management

John Krieg has joined UBS Asset Management as managing director, head of Institutional Client Relationship Management, Americas.

Krieg will lead UBS Asset Management's institutional client relationship teams across the United States and Canada and will also work directly with selected clients. He will report to Susan Small, managing director and head of Institutional, Americas.

Krieg joined UBS Asset Management from Northern Trust Asset Management in Chicago. There he was most recently managing director, Global Head of Institutional Distribution and Consultant Relations, and before that he led Northern's EMEA business from London. Krieg joined Northern Trust as senior vice president and director of Global Product Management and Development. He also previously held roles in New York with TimesSquare Capital Management and Credit Suisse Asset Management. He holds the CFA and CAIA designations.

Administration May 6, 2016

Rethinking Mandatory Cash-Outs

Automatic roll-ins can supplement automatic enrollment, according to Spencer Williams with Retirement Clearinghouse.
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Retirement Clearinghouse last year introduced a service that will match participants automatically rolled out of their 401(k) plans with new plans in which they can roll over those balances.

Spencer Williams, president and CEO of Retirement Clearinghouse, says automatic roll-ins should complement automatic enrollment. “I understand why plan sponsors want to get rid of small balances, but putting assets into a safe harbor IRA is like putting them into a landfill,” he said. “Many accounts get eaten up by fees, and many participants cash out these IRAs.”

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Williams told attendees of the Plan Sponsor Council of America’s (PSCA’s) 69th Annual Conference that about half of participants cash out and the average balance of these cash outs is $1,700. By not rolling these assets into new plans, participants are losing the benefit of compounding.  Also, an automatic roll-in would provide participants with all the fiduciary and group purchase protections of Employee Retirement Income Security Act (ERISA) plans.

Williams said 98% of plans accept rollovers from other plans, and he pointed to Retirement Clearinghouse research that found the majority of Millennials and Generation X want all their retirement savings in employer plans. However, participants claim the process is cumbersome and takes a long time.

Williams said there is a need for a service that will take employee information from the safe harbor IRA and send out to recordkeepers to see if they have an active 401(k) account that matches that participant. If they do, assets in the safe harbor IRA will be rolled into that 401(k) account into the default investment alternative.

Retirement Clearinghouse has seen this process reduce participant withdrawals of the automatic rollovers by 50% or more.

He noted that some recordkeepers fear this will violate ERISA rules because participants are not giving consent to this transfer of money, but Retirement Clearinghouse is awaiting an advisory opinion from the Department of Labor (DOL) that says this process using negative consent is OK.

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