DoL Extracts $10 Million Settlement from Investment Manager
The trust company affiliate of a large investment manager agreed to pay $10.27 Million to settle ERISA violation charges brought by the U.S. Department of Labor. The DoL asserts that the respondent failed to disclose certain money market fund support arrangements intended to ensure that that the fund did not deviate from its $1.00 NAV. Secretary of Labor for Employee Benefits Security, Phyllis C. Borzi, warned: “This settlement is another example of the department holding accountable those who do not adequately disclose to their investors information that is relevant to their investment decisions.”
OUR TAKE: Here comes the Department of Labor. Many wondered how the DoL would enforce its new fiduciary rule. Ms. Borzi answers: The DoL intends to bring lawsuits and force multi-million dollar settlements.