When your employer offers you 401(k) and 403(b) plans, the Employee Retirement Income Security Act of 1974, or ERISA, requires both your employers and their fiduciaries to use good judgment about how to protect that money. Fiduciaries are only allowed to act in the best interests of the beneficiaries and participants of these plans, so breaching any of their duties is a serious offense.
There are a few ways that fiduciaries could breach their ERISA duties. You should make sure to talk to an attorney if one of these issues hurts your retirement fund.
What are common breaches of ERISA duties?
Some common breaches of ERISA you may run into include:
- Failing to obtain competitive bids for services, thereby costing the plan more money
- Not considering collective investment trusts instead of mutual funds
- Failing to review portfolios objectively
- Selecting and retaining certain investments when there are other less expensive options and/or those with better performance histories
- Using more than one recordkeeper, which adds unnecessary expenses to a plan
- Engaging in prohibited transactions
These are just a few of the breaches of fiduciary duties that could hurt your investments and retirement plan.
What should you do if you find out about a problem with your retirement funds?
If a breach occurred it’s important to talk to your attorney about your options for getting compensated and retrieving the funds that you deserve. There are strict limitations set by ERISA on how investments can be made and the duties that fiduciaries have. If you believe that wrongdoing took place, you can talk to your attorney about your options for correcting the situation or filing a lawsuit for fraud against plan participants.