Managed account providers may be leaving plan sponsors vulnerable to fiduciary claims and often disclose too little about their fees and performance to help participants, the Government Accountability Office said in a report released today.
401(k) plan sponsors have increasingly offered their participants managed accounts. Such accounts provide participants with a team of investment professionals who actively manage their retirement savings account.
The GAO reviewed eight managed account providers that represented most of the industry in 2013. It found they all varied in how they structured managed accounts, including the services they offered and their reported fiduciary roles. One of the eight providers defined their fiduciary role in a way that was different from the rest, according to the GAO's findings.
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