The U.S. Department of Labor and the Securities and Exchange Commission have published tips to assist fiduciaries of employee benefit plans in reviewing conflicts of interest of pension consultants.
The tips intend to help plan fiduciaries evaluate the objectivity of advice and recommendations furnished by their pension consultants, according to Ann L. Combs, assistant secretary of labor for employee benefits security.
"Fiduciaries must be provided the information necessary to ensure that advice is objective and not influenced by revenue-sharing and other arrangements pension consultants may have with other service providers," said Combs.
The guidance, "Selecting and Monitoring Pension Consultants -- Tips for Plan Fiduciaries," addresses questions raised by an SEC staff report on potential conflict of interest disclosures by pension consultants. The report by the SEC Office of Compliance Inspections and Examinations indicates that those potential conflicts may affect the objectivity of the advice that they are providing to their pension plan clients.
The tips provide relevant questions that plan fiduciaries should ask to encourage better disclosure and information relating to potential areas of conflicts of interest by pension consultants.
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