Fiduciary Issues

The Department of Labor (DOL) has responded to fiduciary responsibility questions from Citigroup Inc. (Citi) related to their Racial Equity Asset Manager Program.

The House Education and Workforce Committee held a mark-up of several proposals, including four bills (previously announced), which would amend ERISA related to proxy voting, fiduciary duties, and notice requirements for brokerage windows.

Several bills have been introduced in the House of Representatives that would make amendments to the Employee Retirement Income Security Act of 1974 (ERISA).

The Securities and Exchange Commission (SEC) has issued a proposed rule to address cybersecurity risks.

A resolution for congressional disapproval of the Department of Labor’s rule “Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights” passed the House in a 216-204 vote.

The Securities and Exchange Commission (SEC) has issued a final rule “Shortening the Securities Transaction Settlement Cycle.”

The Securities and Exchange Commission (SEC) has issued a proposed rule “Safeguarding Advisory Client Assets.”

Effective February 1, 2022, the federal prime interest rate increased from 7.50 percent to 7.75 percent. The prime interest rate is largely determined by the federal funds rate, as set by the Federal Reserve’s Federal Open Market Committee (FOMC).

Retirement plan assets should be invested prudently to obtain the best possible financial returns, of course. But what if your plan invests in a company that conducts business in a way that violates your ethical values? For example, is it okay for a plan administrator to buy stock in a company with a record of environmental violations and polluting with impunity? Should that behavior affect whether a company qualifies as a suitable retirement plan investment? Is it possible, or even likely, that a company that responsibly produces a similar product may actually be a better choice, measured both by investment returns and by other factors?

The Securities and Exchange Commission (SEC) proposed rule titled, Open-End Fund Liquidity Risk Management Programs and Swing Pricing; Form N-PORT Reporting, has been published in the federal register. With publication in the register, comments on the proposal are due by February 14, 2023. Highlights of the proposal were previously announced.