Over the last several years, an increasing amount of litigation surrounding pension plans has originated from a plan’s fiduciaries suing other alleged fiduciaries such as investment mangers, advisors, and consultants.
This has been true for all types of pension plans sponsored by corporations, unions, not-for-profit organizations, and state and local governments. As seen in legal actions surrounding Executive Life Insurance Company and Enron, related litigation surely follows financial fiascos like the current subprime mortgage meltdown.
This newsletter reviews plans commonly offered by sponsors and identifies some of the risks for a plan’s fiduciaries, highlighted by recent pension-related subprime litigation. It also focuses on the importance of evaluating risks and assessing the performance of a plan’s fiduciaries.