The Wall Street Journal today (subscription required) contains this article: “401(k) Payoffs: Are They Legit?“:
Federal securities regulators, expanding their scrutiny of the mutual-fund industry, are examining whether some funds are paying retirement plans to be included in their lineup of available funds. Officials are concerned that the payments aren’t being disclosed and may result in retirement plans offering funds that aren’t in the best interest of investors. The Securities and Exchange Commission said it wants to know why mutual funds and their investment advisers make certain payments to 401(k) plans, what the money is used for and whether it creates an incentive for retirement plans to favor certain funds over others.
Also, from the New York Times: “S.E.C. Inquiry to Encompass 401(k) Plans.”
And from The McHenry Group, this alert: “SEC Launches Sweep Examination of Mutual Fund 401(k) Payments.” The alert inclues the list of twenty-five questions sent to mutual fund companies by the SEC over the past several weeks.
(Obviously, whatever the SEC finds here would also interest the DOL since, under ERISA, fiduciaries are obligated to select plan investment options under the ERISA standard of “solely in the interest of participants amd beneficiaries.”)