When you operate proprietary mutual funds and offer them in your401(k) plan, you will be a target of ERISA litigators. John Hancock agreed to a $14 million settlement in a lawsuit filed by participants in a company 401(k) plan who alleged ERISA violations in the plan’s management which had $1.85 billion in assets in 2019.
Under the agreement, the insurer will contribute $14 million to a qualified settlement fund, and participant class members’ accounts will be credited with their share of that fund.
As part of the settlement, John Hancock will hire a third-party investment consultant to provide ongoing monitoring and review of the investment options for at least five years from the settlement effective date.