401(k) Lawsuits: What You Need to Know As a Fiduciary


In light of recent activity surrounding 401(k) related lawsuits, we interviewed Peter Mooney of the Ancora Retirement Plans division to get his take on the current 401(k) environment.

Q. There has been a lot of press lately about 401(k) plan related lawsuits. What are the major issues or drivers surrounding this wave of litigation?
A. There has been quite a bit of press lately about plan sponsors being sued by their employees as it pertains to their 401(k) plans. The major issue is the allegation of failing to monitor underperforming and high cost funds in the plan thereby driving up participant costs. The suits also go on to discuss that retirement plans have a duty to systematically and regularly monitor the plan investments, review the fees and also the number of investments that are available to participants in the plan.

Q. What steps or best practices should plan sponsors be taking right now to protect themselves from potential litigation?
A. Two things come to mind. First, every 401(k) plan should have an Investment Policy Statement that outlines a set of objective criteria by which plan investment options are evaluated. Second, plan sponsors should insist on meeting with the service providers who support the 401(k) plan on at least an annual basis. Meetings should review the responsibilities (and associated fees) of each provider as well as a review of the investment options available in the 401(k) plan.

Q. How can Ancora help plan sponsors right now with their current plans in light of the current environment?
A. Ancora Retirement Plan Services can help by conducting a comparative analysis for plan sponsors. This comparative analysis will provide a detailed review of the current investment options and a breakdown of the service provider fees on the current 401(k) plan for the plan sponsor. Gathering and evaluating this information is a critical part of the plan sponsor’s fiduciary responsibilities to the 401(k) plan.

Q. How can they get in touch with Ancora for a 401(k) plan consultation?
A. Plan sponsors can feel free to contact me or Bill Koenig and we would be happy to discuss any aspect of your current 401(k) plan. Of course you can also reach out to your Ancora relationship manager who will coordinate the consultation. In the current environment it is a very good time to have a fresh set of eyes review your plan from a best practices standpoint.

Ancora Retirement Plans

Peter Mooney

Bill Koenig


The mention of specific securities, types of securities and/or investment strategies in this newsletter should not be considered as an offer to sell or a solicitation to purchase any specific securities or to implement an investment strategy. Please consult with an Ancora Investment Professional on how the purchase or sale of specific securities can be implemented to meet your particular investment objectives, goals, and risk tolerances. Past performance of these types of investments is not indicative of future results and does not guarantee dividends/interest will be paid or paid at the same rate in the future. The data presented has been obtained from sources that are believed to be accurate and credible. Ancora Advisors makes no guarantee to the complete accuracy of this information. The indexes discussed are market performance indices and are not available for purchase. If you were to purchase the securities that make up these indices, your returns would be lower once fees and/or commissions are deducted. Past performance of these indices is not indicative of future results of the securities contained in these indices.

Safeguard Securities, Inc. is a registered investment adviser. A more detailed description of the company, its management and practices are contained in its “Firm Brochure”, (Form ADV, Part 2A). A copy of this Brochure may be received by contacting the company at: 6060 Parkland Blvd, Suite 200, Mayfield Heights, OH, 44124, Phone (216) 593-5090.

View All >