Witnesses at a hearing on proposed Department of Labor regulations designed to enhance the transparency of employee benefit plans said the new rules do not fit with the reality of broker compensation and could undermine existing protections for brokers.
The proposed regulations would require that contracts between certain service providers and plans provide for specific and detailed information to be disclosed to plan sponsors.
Additionally, all services furnished to a plan and all compensation, direct and indirect, to be received by the service provider would have to be disclosed in writing. The proposed rules also require the disclosure of possible conflicts of interest of the service provider that may affect the performance of plan services.
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