Navigating ERISA Rules When Investing Plan Assets: Key ERISA Terms, Fiduciary Issues, Prohibited Transactions, Exemptions

ERISA plan fiduciaries must provide the care and prudence required under ERISA. Company officers, directors, and key personnel are responsible for appointing and monitoring an investment manager that provides services to the company's plan. Counsel must understand key components of ERISA, the fiduciary responsibility rules, the impact of engaging in prohibited transactions, and other provisions to assist plan sponsors, administrators, and investment managers.

The lack of knowledge of ERISA rules, proper procedures, and oversight of the actions of an investment manager can result in significant liability and potential litigation. A fiduciary of an individual account plan may, consistent with ERISA requirements, offer as an investment option under the plan a professionally managed asset allocation fund with a private equity component. However, due to the complexity, limited transparency, and liquidity of private equity investments, including a private equity component in an investment option can increase the potential liability for fiduciaries, who have a legal duty to select prudent investment options. ERISA also requires fiduciaries to monitor designated investment alternatives under the plan. Fiduciaries are liable for any losses resulting from the failure to monitor these investments prudently.

Counsel must be knowledgeable and able to properly advise plan fiduciaries on the rules and requirements of ERISA, the duty of care and prudence in appointing investment managers, and effective methods for developing and implementing monitoring procedures to provide oversight over the investment manager's activities.

Listen as our panel discusses critical aspects of regulations under ERISA, the fiduciary rules, prohibited transactions and exemptions, as well as provides insight into the proper methods of developing and implementing monitoring procedures for retirement plan sponsors to avoid potential liability.

1. Key ERISA terms and definitions
2. ERISA fiduciary responsibility rules
3. Prohibited transactions and exemptions
4. Fiduciary governance and evaluating plan investment options
5. Key issues for hedge funds and private equity fund investing

The panel will discuss these and other key issues:

• Key ERISA terms and definitions
• ERISA plans and asset manager fiduciary standards and compliance
• Prohibited transactions and certain exemptions
• Fiduciary governance and evaluating plan investment options
• Regulatory considerations for ERISA plans that allocate assets to hedge funds and private equity funds