Most agree there are problems in the 401(k) world. Certain typesof plans (mostly small ones) don’t have the clout to negotiate feesas favorable as their larger brethren. Certain types of investmentoptions (notably those involving annuities and collective trustfunds) do not disclose vital information as vigorously as theirmutual fund counterparts (mostly because the latter are required bylaw to report while the former are not). Certain types of mutualfunds charge certain fees (namely 12b-1 and revenue sharing fees),that have a directly negative impact on fund performance versusthose that don’t. Certain types of service providers (namelynon-fiduciaries) can legally place a plan into investments againstthat plan’s best interests.

These problems are well documented and their correspondingsolutions, while controversial, possess the key attribute of beingobvious and easy to implement. There are more problems, mostlydealing with participant’s lack of participation, naïvediversification strategies and lack of long-term thinking. We areseeing plan sponsors more successfully address these problems asbehavioral finance techniques slowly (and not so slowly) seep intoplan design.

Given this, why have Ian Ayres and Quinn Curtis – two lawprofessors and the seemingly self-proclaimed dynamic duo of 401(k)fee-dom – so botched what should have been an easy research reportthat even industry thought leaders – who are well aware of theaforementioned 401(k) problems – find it difficult to support (see“Hit,Miss or Backfire? Controversial Ayres/Curtis 401k Fee Paper ClaimsBroad-Based Fiduciary Breach,” FiduciaryNews.com,March 4, 2014).