Old Slip Capital Announces New Miami Office, Issues Advisory for ERISA by James Lukezic, Managing Director
New York, NY
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July 19, 2024 08:41 AM Eastern Daylight Time
Old Slip Capital has announced the opening of its new office in Miami, FL. The company has also issued an important advisory to plan sponsors, pointing to the advantages of trusting ERISA Fiduciary Advisors.
Old Slip Capital's new office in Miami will further add a growth potential to its prospects. It has also shared insights for Plan Sponsors to help them derive the best from ERISA. The advisory focuses on explaining the difference between an ERISA Fiduciary Advisor and a Standard Broker or Advisor, and helps in understanding that selecting a Standard Broker or Advisor is simply not good enough.
According to James Lukezic, Managing Director at Old Slip Capital, there are some obvious dangers of not hiring an ERISA Fiduciary Advisor under section 3(38) or 3(21) or both: "Plan Sponsors think that simply having an Advisor at the table is enough until they (Plan Sponsor) realize that a Standard or Retail Advisor is giving them arm’s length advice and not truly taking on liability or responsibility for that advice. With a sanctioned ERISA Fiduciary Advisor, Plan Sponsors can shift that liability to the ERISA Advisor and his or her firm; that includes personal liability on the part of the investment committee members".
The advisory goes on to point out that plaintiffs’ class action lawyers in fiduciary breach lawsuits, the Department of Labor in ERISA plan audits, courts, and insurers have focused increased attention on how well ERISA plan fiduciaries follow procedural due process. Actions (or inactions) of committees and individual investment committee fiduciaries are scrutinized and judged in increasing detail, causing fiduciaries to wonder if they are up to date on all of the best practices for plan governance.
According to Old Slip Capital, understanding the roles of Fiduciaries and the types of Fiduciaries generally causes confusion. There are Trust Fiduciaries, Administrative Fiduciaries and ERISA Fiduciaries; the latter being the most important. The role of the ERISA Fiduciary is critical, as this advisor is the glue that holds the Retirement Plan together, his or her advice to the Investment Committee steers the success of the plan in a big way.
The advisory further explains that competence to act as a fiduciary on the investment committee means more than just having subject matter expertise. It also means having the time needed to devote to the fiduciary role. Putting aside the potential conflicts of interest that a director would face in switching hats from corporate director to plan fiduciary, even a director with the requisite expertise to act as a fiduciary, typically lacks the time (and probably the inclination) to perform more than an oversight role. Furthermore, the Board of Directors should never be left in the position of acting as the Investment Committee. Unfortunately, this is precisely the form of fiduciary governance structure that is in place with the overwhelming majority of employer sponsored plans.
Disclaimer: This press release may contain forward-looking statements. Forward-looking statements describe future expectations, plans, results, or strategies (including product offerings, regulatory plans and business plans) and may change without notice. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements.
Contact Details
Old Slip Capital Partners
James Lukezic
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