The Inconvenient Truth of Fiduciary Loan Regulation

Inconvenient Truth

Plan sponsors have historically treated 401(k) loans as an administrative program outside the boundaries of fiduciary standards and review.  The truth, however inconvenient it may be, is that the DOL has taken the position that a participant loan is a plan investment, and requires the same fiduciary oversight as any other investment in the plan.

401(k) Loans Are Treated As Plan Investments Per The DOL
Bill Schmidt and George White
Bill Schmidt and George White


In a telling new editorial, Bill Schmidt, Of Counsel at K&L Gates, and George White, EVP, Operations for Custodia Financial, lay out the case that 401(k) loans are not excluded from the prudence requirement under ERISA. It’s a must read for anyone who works with a 401(k) plan.

Click here to read this groundbreaking editorial published by Bloomberg BNA on April 30, 2018.


Bloomberg BNA

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