YOUR kPlan
ANBTrust
Reish, Luftman, Reicher & Cohen, Attorneys at Law
We would welcome the opportunity to provide further information, a proposal or sample documents for your review. If you have any questions please contact us at:
The American National Bank of Texas Wealth Management Group
1010 West Ralph Hall Parkway
Suite 112
Rockwall, TX 75032
Telephone: 214.863.6800
The American National Bank of Texas, Trust Division provides a unique service and opportunity to Plan Sponsors through a complete turnkey trust alternative, the ANBTrust.
Most Trustees are directed or co-trustees, providing a minimum of service, typically an annual trust statement. In contrast, we monitor the entire plan through our Trust Retirement Committee. Our Trust Retirement Committee consists of Senior Trust Officers, Legal Counsel, and Members of Executive Management including our CFO who have acknowledged their fiduciary status in writing and have been through specialized training for ERISA fiduciary governance. The Trust Retirement Advisory Committee consists of 2 ERISA Attorneys, 2 Retirement Plan Administration Specialists, an Investment Analyst, Business Planning Specialist, and Employee Benefit Trust Officers. The Trust Retirement Committee meets monthly to review and monitor plans.
No one can remove 100% of the liability from an employer, but our Trust Division accepts the role — in writing— of Trustee, Named Plan Administrator and Named Fiduciary. Where the typical trustee may be little more than a passive custodian, ANB’s Trust accepts full discretion—and therefore responsibility—for the prudent management of the plan and assets in its care.
As Full Corporate, Discretionary Trustee and named Plan Administrator, we basically assume the role of the Plan Sponsor for the day to day operation and monitoring of the plan relieving the plan sponsor of the majority of their fiduciary liability and the need for an oversight committee.
Our Retirement Trust Committee approves all new clients and monitors plans through our fiduciary process. The plan sponsor is required to
- provide accurate census;
- make timely contributions
- oversee and monitor the performance of the named Trustee and Plan Administrator, typically at the board level of the plan sponsor or by a named individual /director on an annual basis.
Not all Trustees are the same;
there are three common trustee arrangements:
- Self-Trustee.
- The Plan Sponsor names one or more employees or owners as trustee(s) and retains liability for prudent management of plan assets and plan oversight.
- Directed Corporate Trustee.
- A bank or trust company accepts the title of Trustee and serves primarily as custodian but rejects “discretion” over plan assets. The Plan Sponsor therefore retains full liability for prudent management of plan assets and plan administration oversight.
- Discretionary Corporate Trustee.
- An institutional trustee accepts full discretion and therefore liability for prudent management of plan assets.
As Trustee we are responsible for selection and monitoring of investments and service providers such as the custodian, record keeper, investment managers, Registered Investment Advisors, etc. The Trustee is also responsible for oversight of participant communications and education. We are the direct contact and coordinator for service providers. Service providers are selected through an RFP process.
Our specialists work directly with your human resources department and benefits manager providing them with information they need to perform the ministerial duties associated with the retirement plan and to help prevent them from becoming fiduciaries to the plan.
As Trustee and Fiduciary our actions must be for the exclusive purpose of providing benefits and paying reasonable expenses. ERISA states a fiduciary must act “(i) for the exclusive purpose of providing benefits to participants and their beneficiaries; and (ii) defraying reasonable expenses of administering the plan…” This is known as the Exclusive Benefit Rule. The Exclusive Benefit Rule provides that fiduciaries may not deal with the assets of the plan for their own account or for the benefit of someone whose interests are adverse to those of the plan.
As Trustee and fiduciary we must also evaluate whether the fees may be paid by the plan. In order for fees to be paid out of plan assets, the fees must be reasonable, they must be for fiduciary activities and the plan must not prohibit the payment of expenses out of plan assets. Fiduciary activities include costs for activities related to the administration of the plan, the investment of the plan assets, and services for the plan and its participants.
As a fiduciary, we must act for the sole purpose of providing benefits to participants and beneficiaries and paying reasonable expenses. We select and monitor the plan’s investments, we evaluate whether investment fees may properly be paid by the plan. That is, we must decide whether the fees are reasonable and permitted by the plan document. We utilize the Department of Labor’s fee disclosure forms.
Fiduciaries who receive compensation related to investments may not cause themselves to receive additional income as a result of the investments they select for the plan. The DOL has provided examples of two methods used by fiduciaries that do not violate ERISA’s requirements. These include the offset method and leveling. Full disclosure is the rule.
As Full Corporate Trustee, our duties include, but are not limited to:
- Sign Plan Documents as Trustee.
- Prepare an Investment Policy Statement (IPS) for each plan.
- Serve as the ERISA section 404(c) fiduciary and assure compliance with the 404(c) requirements under Department of Labor.
- (DOL) regulations for participant directed plans.
- Manage plan assets in the case of pension plans and other non-participant directed plans.
- Select and monitor investments and fund managers for each plan.
- Select and monitor Registered Investment Advisors (RIA).
As Named Plan Administrator, our duties include, but are not limited to:
- Exercise discretion to interpret the plan document.
- Review and sign Form 5500 for each plan.
- Select and monitor service providers, including third party administrators (TPA).
- Oversee participant communications.
- In conjunction with the TPA, confirm participant vesting (though in this situation, the Bank would rely exclusively on census data provided by the plan sponsor).
- Approve loans and hardship distributions and qualify domestic relations orders.
- Make sure all discrimination tests are completed and adhered to on a timely basis.
