The compliance date for the final service provider fee disclosure regulations under ERISA Section 408(b)(2) is July 1, 2012. That is when registered investment advisers (RIAs) and broker dealers (BDs) must disclose certain information to the responsible plan fiduciary, including services provided to the covered plan, fiduciary status and direct and indirect compensation.
We suggest RIAs and BDs take these seven steps right now:
1. Identify affected accounts
2. Determine identity of responsible plan fiduciary to ensure delivery to appropriate person
3. Determine the types of services being provided and the applicable disclosure requirements
4. Determine where and how to obtain disclosure data.
5. Develop an approach for meeting compliance deadline
6. Establish procedures for communicating any changes to disclosures – an amended Form ADV may be sufficient
7. Reconcile services provided with errors and omissions coverage
Click here to read an article with additional information about the requirements and the steps that must be taken to remain in compliance. Failure to comply can result in a 15% excise tax.
If you have questions about the disclosure regulations or need help with compliance, please contact Lisa Zimmer (email@example.com or 248.784.5191) or any other member of the Broker Dealer/Investment Adviser Law and Regulation Group at the law firm of Warner Norcross & Judd.