SB 112-40: Retiree Income Protection Act (Passed)
Mr. Reactionary:
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RETIREE INCOME PROTECTION ACT
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1. Any financial service provider who invests and manages a 401(K) plan hereby possess a fiduciary duty to make investment decisions as a reasonably prudent investor would for the benefit of the beneficiaries of the investments. Accordingly no such officer, agent, or employee shall make investment decisions for a 401(K) plan that prioritize the proprietary funds of the financial service provider or unreasonably increases administrative costs for the fund or investment fees for the financial service provider when such decision is made for a purpose other than benefiting the beneficiaries of the investments.
2. Any 401(K) plan with assets totaling less than $5 Million shall be prohibited from incurring an expense ratio exceeding 1.05% of assets.
3. Any 401(K) plan with assets totaling more than $5 Million but less than $20 Million shall be prohibited from incurring an expense ratio exceeding 0.8% of assets.
4. Any 401(K) plan with assets exceeding $20 Million shall be prohibited from incurring an expense ratio exceeding 0.5% of assets.
5. No financial service provider shall offer a revenue sharing agreement to intermediaries for choosing a fund that exceeds 0.25% of fund management costs.
6. Any 401(K) plan shall annually disclose to all investors in such fund any fee, expense, or administrative cost incurred annually in the management of such fund. This includes but is not limited to any revenue sharing cost.
7. Any employee with an existing 401(K) plan provided by an employer who takes a job with a new employer shall be permitted to transfer the value of the existing equity in the 401(K) plan into a 401(K) plan offered by the new employer with no tax consequence. Employers shall nor charge for such transfer. If the new employer does not offer a 401(K) plan, then the employee may convert the value of the existing equity in the 401(K) plan into a fixed-payment annuity upon retirement with no tax consequence.
8. Any beneficiary shall be entitled to initiate a beneficiary derivative class action lawsuit against any officer, agent, or employee violating this act to seek damages and legal costs.
9. This act shall take effect ninety (90) days from the date of passage.
Sponsor: Spiral
Debate on this bill is now open.
Mr. Reactionary:
Id like to thank the sponsor for this bill. It looks like it helps retirees with 401K by allowing for portability from job to job, caps on greedy plan investor fees and limits on conflicts of interest, and transparency of plan fees. Sounds good for retirees.
Deep Dixieland Senator, Muad'dib (OSR MSR):
Waiting for WD and S019 to motion to table.
Mr. Reactionary:
Any other thoughts?
Mr. Reactionary:
I move for a final vote. 24 hours to object.
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