They still want to skimp when the plan is in so much trouble

I’ll get the referral from and advisor or third party administrator (TPA) with the plan that hasn’t been restated for 15 years and haven’t filed for a 5500 in just as long. They introduce me to the potential client, I offer them my help, and then crickets.

Even when presented with possible plan disqualification and 5500 penalties that can be thousands of dollars a day, I hear nothing. They’re looking for the one provider who suggests they can terminate the plan or merge into a new plan, to cover the “dead bodies.” Even with all their issues, they still think they can skimp.

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Are you kidding me?

The older I get, the more I’ve become Larry David in Curb Your Enthusiasm. I’m at the point where I won’t stop by withholding complaints when something annoys me.

I’ve been in my practice for 14 years, and I’ve been an ERISA attorney for 25 years. So safe to say, I knew quite a few financial advisors. Heck, I’ve run almost two dozen events around the country to meet advisors.

Yet, I’ll still get a phone call from an advisor who claims they want to know what I do and almost all the time, they want to know if I could refer them business. To be explicit here, most of my business is from referrals from advisors and third-party administrators (TPAs) mainly because my articles over the years have helped my reputation and might have helped them in business. Plan sponsor clients coming to me directly, happens, but not as often as I would like. Many have an advisor already, some don’t. Let’s be honest, if I had referrals to make to make plan sponsors for advisor referrals, am I going to refer someone I’ve known for a long time or someone I just got off the phone with?

Relationships take time, they don’t happen overnight. It requires time and trust. I met a few advisors in Texas, I’m sure it will take time for them to refer me, to clients, because they’re probably trying to see if I can be trusted with their clients. Trust and relationships are a big thing in this business and they don’t happen overnight.

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They won’t defend you, they don’t defend themselves

When I was a kid in Hebrew day school, I enjoyed going to the synagogue services for kids, that were led by kids. Then my parents attended service too. It was to the point that my father met a bunch of synagogue insiders and was invited to the special club, called the Kaddish Club, which meant you had one dead parent that you could say the Kaddish memorial prayer. What was great about it was their own special Kiddush meal after services ended.

My father quit in a huff because another member criticized his role as a membership director and was upset that none of his friends spoke in his defense. The other member never criticized my father by name and my father wasn’t the only membership director. Most importantly, he didn’t speak up in his defense if he thought the criticism was directed at him.

Years ago, I left a third-party administrator (TPA) to join a law firm. If you’ve read my books, you’ll know it was not amicable and we all took things personally. Let us just say that TPA no longer exists. None of my former co-workers spoke in my defense. I wasn’t upset by that because they never spoke up in their defense when they were mistreated by the guy running the place.

There may be people that criticize you and no one may defend you, but you should defend yourself. You can’t expect people who are. Passive to speak in your defense when they don’t speak in their own defense.

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The Federation of Americans for Consumer Choice (FACC) has filed a second lawsuit against the Department of Labor (DOL), in an effort to stop the new fiduciary rule.

The FACC, along with other independent insurance agents, filed for a preliminary injunction in the U.S. District Court for the Eastern District of Texas. The suit argues that if applied, the new fiduciary rule would cause “dire consequences for tens of thousands of independent insurance agents and their clientele if not stopped.” Therefore, its implementation should be delayed until the first lawsuit is settled, plaintiffs maintained.

The insurance advocacy group has sued the Department of Labor (DOL) in May, where they accused the DOL of violating the Fifth Circuit Court of Appeal’s previous rule that vacated the 2016 fiduciary rule. FACC’s lawsuit claims that the DOL is again attempting to regulate industries outside of retirement plan advisors through the new rule and the PTE 84-24 amendment.

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Blue Ridge buys TSC

Blue Ridge Associates (“Blue Ridge”), a third party administrator (TPA) for ESOP and qualified retirement plan benefits, announced that they have acquired Tax Sheltered Compensation, Inc. (“TSC”). TSC is a TPA, serving 3,100 plans covering over 152,000 participants across the small and middle-market business community.

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It’s dangerous to have an opinion

When it comes to business, I say that I’m not competing with any other ERISA attorney out there, I’m competing against myself.

I will say that the biggest obstacle to getting business has been my opinion. Being frank and espousing what you believe in, can certainly rankle people, especially those who think ADP and Paychex are great at plan administration.

Whether it’s producing third-party administrators, or payroll providers, or opining that an auditor had to be truly independent from other plan providers, my opinions can offend. I should say less and only nice things, but that’s not me. If something bad in the business is going on, like a lack of fee transparency before fee disclosures or punitive termination fees, I’m going to say something. That’s me. You need to realize that expressing an opinion, no matter how popular, can offend and draw away business. There is a cost for “free speech.”

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I recommend PEP-HUB

There are a lot of great 401(k) services out there that I haven’t used, so touting them isn’t going to be a big thing for me. I will tout the folks at PEP-HUB (

I came across Robb Smith and Jerry Conway a few years back when they were tabulating information on pooled employer plans (PEPs) and pooled plan providers (of which I serve as one). I understood they also conducted Requests for Proposals for those looking for PEP solutions. As an ERISA attorney for aa multiple employer plan that wanted to transition to a PEP, I couldn’t recommend my solution (conflicts of interest are a big thing for me to avoid), so I recommended PEP-HUB to conduct the RFP so that the process was on the up and up.

Robb Smith and Jerry Conway conducted a very economically reasonable and thorough RFP process. Impressed with their work and handling of the process from beginning to end. Anyone looking for PEPs should seek their guidance.

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My biggest pet peeve in business

For 14 years now, I have had an ERISA practice of my own and my favorite part of the job is meeting people across the retirement plan industry. Part of my practice is helping advisors and third-party administrators (TPAs) with free content they could use and the answering of a question or two, on the house.

So what drives me nuts is when I get contacted by a new advisor and their only concern is getting my business to be a client of theirs or that I have referrals for them. First off, I handle my assets and second, if I have clients to refer to advisors and TPAs, I’m going to refer it to advisors I have known for years, and not someone I just connected to on, LinkedIn.

The retirement plan business is relationship-driven. That means building relationships, that take time and effort, not something that can be created out of thin air, in a day.

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Make sure providers let you know about a data breach

I had a running joke about places I’d work where I felt the only way they’d tell you that the business closed was by letting you know after the doors closed. We were the last to know anything.

With the news of the Chase data breach, make sure any plan providers advise you of any data breach on their end. As someone who hired them, there is some culpability and you don’t want to be on the hook for something that you are unaware of.

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People would want a state run plan

You work for a company, you want benefits. When I worked for others, what I wanted was a retirement plan.

So it comes as no shock that people want any type of retirement coverage, even if it is state-run, according to a study from the National Institute on Retirement Security (NIRS).

According to the study, 77% agree that a state-run program is a good idea. 82 % of Americans said they would participate in state-facilitated retirement programs, a rise from 75% just four years prior in 2020. The sentiment is held across all party lines, with 86% of Democrats, 74% of Republicans, and 71% of Independents showing strong support for state-wide retirement programs.

I like state plans because they increase retirement plan coverage and that could certainly spur employers to have plans of their own if mandated to offer one, or join a pooled employer plan.

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