Rules & Processes for Fee Disclosure Compliance

Effective July 1, 2012, the Department of Labor mandates that plan sponsors and plan participants receive disclosures on any fees paid to covered service providers including:

§ Investment advisors,

§ Third Party administrators,

§ Plan auditors

§ Investment platforms

In 2012, the U.S. Department of Labor (DOL) implemented new fee disclosure regulations for retirement plans. These regulations require plan sponsors to provide participants with notices on plan fees and expenses. These notices must be distributed to participants annually by August 30th.

If you have plan assets invested with an Investment Platform, please pay close attention to these communications from them regarding participant fee disclosures.  When applicable, Panagiotu Pension Advisors charges transactional fees to the individual participant.  The PPA Fee List must be included with the Investment Platform fee disclosure notice.  A complete "Investment Platform Annual Fee Disclosure Process Checklist" is available by clicking here.

If you have plan assets held in Individual Brokerage Accounts, your brokerage account provider(s) may generate the required annual disclosure notice(s). We recommend that you contact your brokerage account provider(s) and request a copy of their "annual participant fee disclosure notice" (also known as the 404a-5 disclosure).  If the account provider does not generate such a disclosure, request a "fee summary", "pricing guide", "expense list"or any other documentation of the fees & expenses paid from the account.When applicable, Panagiotu Pension Advisors charges transactional fees to the individual participant. The PPA Fee List must be included with the Investment Platform fee disclosure notice. A complete "Individual Brokerage Account Annual Fee Disclosure Process Checklist" is available by clicking here.

Failure to distribute the above notices annually could result in personal liability for plan fiduciaries and liability for the plan sponsor.  Please contact your PPA plan administrator if you have any questions or concerns.           

Additional information on annual fee disclosures is presented annually at PPA's Client Seminar each October.  Invitations for the event are sent out in early September. 

Regulatory Statutes

Disclosures to Plan Participants - Department of Labor Regulation 404a-5     

There are two sets of disclosures – Annual & Quarterly

Annual – Annually, by August 30th, participants must be provided with disclosures of any fee that may or will come out of the plan.  In addition, investment performance history on all plan investments must be provided. Your investment platform provides this information which can be distributed to participants personally, by mail or electronically.

Quarterly – Quarterly disclosures must be made to the participants.These disclosures will be on the quarterly participant statements provided by the investment platforms. The disclosures will break out specifically any fees paid out of the plan assets from a participant’s account.  Note:  Participant quarterly statements are provided by the investment custodian.  Plan sponsors have no responsibility for this process.


Disclosures to Plan Sponsors - Department of Labor Regulation 408b-2

Plan sponsors must be provided with fee disclosures from their service providers prior to paying fees that could be paid to the provider by the plan. Those fees include:

§ Plan administration expenses

§ Investment Platform commissions or "trail"

§ Investment expenses

§ Plan loan fees

§ Participant account fees

§ Distribution fees

Your service provider is required to provide you with such disclosures.  Panagiotu Pension Advisors does so through our annual engagement letter.

If you have any questions on implementing the disclosure process, please contact your PPA plan administrator.