25.01.2020 05.01 GMT+0000
In selecting new providers and reducing plan costs, fiduciaries need to be alert to the conduct of deselected providers.
Scrutiny of plan fees may create situations where an incumbent plan provider can make more by losing a highly competitive bid for an employer-sponsored plan -- and then actively “harvesting” accounts and assets from that plan--than by retaining that plan. And, once deselected, the provider-- and individual representatives employed by that provider--may have a strong economic incentive to encourage participants to move assets out of the employer-sponsored retirement plan and into the retail products of the (deselected) provider.