As a reminder to our clients and friends, the August 31 deadline for disclosing plan fees and investment-related information to participants in 401(k) and similar participant-directed plans (as required by DOL Regulation Sec. 2550.404a-5) is rapidly approaching.
The regulation mandating the disclosures is lengthy and complicated, and plan fiduciaries must prepare their disclosures in “good faith” using a “reasonable interpretation” of the Regulation. In addition, if the plan fiduciary has delivered disclosures to participants and determined that errors were made in such disclosures, the DOL has advised plan fiduciaries they may wish to develop a policy to correct the errors to lessen the possibility of enforcement actions.
Note that these participant disclosures are different from the fee and conflict-related disclosures that plan service providers were required to deliver to plan fiduciaries by July 1. However, plan fiduciaries may rely on the information provided by such service providers in preparing participant disclosures, and may also delegate preparation of some of the materials to service providers.