What is a Directed Trustee of a Health & Welfare or Qualified Retirement Plan?

A person or organization that holds the assets of a Health & Welfare Plan or Qualified Retirement Plan is considered a “Trustee” under ERISA. The Directed Trustee is named by the 402(a) Named Fiduciary of your plan and holds a fiduciary responsibility to:

  1. Determine contributions owed to the plan, and ensure they are collected in a timely manner.
  2. Monitor the accuracy of contributions collected – and pursue the recovery of contributions from delinquent employer members.
  3. Provide delinquent employer members with a notice of legal action – and oversee the payment of interest, court costs and other legal fees should a lawsuit be filed.

Why Do You Need A Directed Trustee For Your ERISA Plan?

Directed Trustees are becoming an increasingly popular position in the management of ERISA Plans. Appointing a prudent expert in Health & Welfare and Retirement Benefits, as well as ERISA legal compliance, as your Directed Trustee is a smart way to diversify fiduciary liability in your organization.

Similar to Plan Administrators, Investment Managers, and other Plan Fiduciaries – appointing an independent fiduciary to manage your Trust Fund is a great way to ensure your Plan is operated in a way that best serves Participants & Beneficiaries. Also, this signals to the Department of Labor that you are taking every action necessary to remain in compliance with ERISA.

Our Sole Trustee Services:

  • Act as Directed Trustee to the trust fund for the plan – following directions under the Named Fiduciary, Plan Administrator, Investment Manager, Investment Advisor, and other Designated Representatives
  • Determine and Receive Contributions – receive and hold any and all contributions made to the plan, while ensuring that amounts contributed are accurate according to plan documents
  • Oversee Distributions – make payments from the trust to or for the benefit of participants and beneficiaries, under the direction of plan fiduciaries
  • Record Keeping of all receipts, investments, disbursements, and other transactions
  • Accounting of the Trust Fund – will file a written account of the administration of the Trust Fund, showing all transactions effected by the Trustee, the Investment Fiduciary, and the Investment Manager for the Plan Year
  • Provide Notice of Legal Actions to the Named Fiduciary and Plan Administrator detailing any claim against the Plan or Trust
  • Provide Notice of Legal Action to delinquent employer members detailing legal actions that may be taken to collect required contributions or other interests to the Plan

Hire A Prudent Expert To Be Your Directed Trustee

While many companies appoint an in-house employee to serve as the Directed Trustee of their Health & Welfare or Qualified Retirement Plan, more employers are hiring a prudent expert to take on this role.

In a world where regulatory enforcement is becoming more aggressive, having an independent expert to serve as your Directed Trustee is a smart way to lower your risk of being audited by the DOL.

Contact ERISA Advisory Group Today

Are you considering hiring an ERISA Independent Fiduciary to serve as your plan’s Directed Trustee?

The ERISA Advisory Group has been serving organizations that offer Health & Welfare and Qualified Retirement Plans to employees for over 25 years.

We’d be happy to see if we’re a good fit to serve as Directed Trustee for your plan, just contact ERISA Advisory Group today!