Legislation approved by a House panel to require greater disclosure of 401(k)
plan fees won’t pass this year, the panel’s chairman and a sponsor of the
legislation said.
The bill, H.R. 3185, which was approved in April by the House Education and
Labor Committee, would require 401(k) plan administrators to disclose fees in
four distinct categories: plan administrative and record-keeping charges;
transaction-based charges; investments charges; and other charges as specified
by the Labor Department.
Additionally, plan administrators would have to disclose any financial
relationships among service providers that could lead to potential conflicts of
interest as well as information about investment options and risks.
The committee’s chairman, Rep. George Miller, D-California, acknowledges that
the bill, which his committee approved on a party-line vote, will not win
passage this year, with a spokesman blaming opposition from the Bush
administration.
Earlier, Bradford Campbell, assistant secretary for the Labor Department’s
Employee Benefits Security Administration, said the legislation would make
401(k) plan fee disclosure more “complex and expensive than it needs to be.”
Employer groups opposed the legislation, saying it would have led to more
litigation and higher administrative costs, while overwhelming participants with
too much information.
Supporters of the legislation, though, argued that participants now lack the
means to accurately compare fees.
Filed by Jerry Geisel of
Business
Insurance, a sister publication of Workforce Management. To comment,
e-mail editors@workforce.com.
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