The Encore Fiduciary Large-Plan Recordkeeping Benchmark Study

What Large Defined Contribution Plans Pay for Recordkeeping Services

The Encore Fiduciary Large-Plan Recordkeeping Benchmark Survey – What Large Defined Contribution Plans Pay for Recordkeeping Services is designed to provide a reliable benchmark for plan fiduciaries to defend against imprudence lawsuits that are based on false and misleading comparisons.

There have been hundreds of fiduciary imprudence lawsuits been filed in the last eight years alleging that large plan sponsor fiduciaries are “asleep at the wheel” by allowing recordkeepers to charge excessive fees to plan participants. But while the initial lawsuits against universities and other corporate plans might have alleged legitimate claims of high asset-based plan administration fees and uncapped revenue sharing, many of the current purported excessive fee cases are based on misleading facts, pure conjecture, and improper benchmarks. In some cases, the recordkeeping fees alleged in these fiduciary malpractice lawsuits are just plain false. But even when the fees at issue are properly alleged in the complaint, which is very rare, the purported recordkeeping benchmarks proposed in these lawsuits have no support in reality.

As one of the leading providers of fiduciary insurance to large plans across America for plan sponsors that sponsor plans with assets over $100m, Encore Fiduciary annually reviews thousands of rule 408(b)2 and 404(a)5 fee disclosures. We have a unique perspective to analyze what large plans actually pay for recordkeeping fees. We tracked over 2,500 plans with $100m or more in plan assets in 2020, 2021, and 2022.

(1) the type of misleading benchmarks that are being used in excess fee imprudence cases; (2) the results of the Encore Fiduciary recordkeeping benchmark survey; and (3) how the more reliable Encore benchmark survey statistics can be applied to debunk pending excess recordkeeping fee imprudence cases.

Disclaimer: This whitepaper is intended to provide fiduciary thought leadership and advocacy for the plan sponsor community in areas of complex fiduciary litigation. It is not affiliated with any other company and is not intended to represent the views or positions of any policyholder of Encore Fiduciary, or any insurance company to which Encore Fiduciary is affiliated. Quotations from this site should credit Encore Fiduciary.

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