I always believe that appearances are extremely important and if things just don’t look right, they should be avoided at all costs. I take issue with my school district where the children of the board of education members have been given full-time employment. Sure, the board member abstains when their child or children are hired, but when the other board members are long-time associates in multiple civic organizations and one the board, does it really matter? Things that look fishy give off the appearance of impropriety, even if it’s not.
When it comes to hiring a plan provider or even selecting investment options, any appearance of impropriety or conflict of interest is going to warrant attention and the last thing you want is attention from the Department of Labor (DOL). The DOL on audit has been targeting any conflicts of interests in plan investment options and selecting investment advisors. So using too many proprietary funds of your plan provider or selecting your sister as the financial advisor are some things you should avoid.