The amended claim alleged Duke used plan assets to pay for the salaries and fringe benefits of some University human resource employees, amounting to a prohibited transaction under the Employee Retirement Income Security Act.
Two lawsuits against fiduciaries of Duke University's 403(b) retirement plan will be settled for $10.65 million, pending a court approval of the agreement between the parties.
In 2016, an initial claim was filed against Duke's plan, which covered about 38,000 participants and held $4.7 billion in assets at the end of 2014.
Twenty lawsuits have been filed against university-sponsored retirement plans since 2016. As is common in the claims, plaintiffs in the Duke plan alleged it was loaded with expensive investments and paid excessive fees to plan recordkeepers for duplicative services.
4 recordkeepers, more than 400 investment offerings
Duke's plan had four recordkeepers and offered more than 400 investment offerings in its plan lineup, according to court documents. The use of multiple recordkeepers prevented the plan from most efficiently leveraging its size to reduce the cost of administering the plan, plaintiffs alleged.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
