401(k) Providers To Disclose Fees to Companies

The Bush Administration is trying to push through a proposal in which 401(k) plan providers would have to fully disclose their fee structure to companies prior to being taken on as a provider of 401(k) services.

Companies selling 401(k) services should be forced to disclose all the fees and expenses that can drain money from workers’ retirement plans in writing before businesses trust them with their employees’ money, the Bush administration proposed Wednesday. … Under the proposed regulation, companies offering 401(k) and other employee benefit plans would have to submit in writing all services their plan offers and all direct and indirect compensation they get from the plan. Plan providers would also have to disclose any possible conflicts of interest that could affect the plan’s performance. The proposed regulation would also give protection to employers when plan providers don’t complete disclose required information.

I’m actually surprised this isn’t currently required, I would imagine that this level of information would be necessary for a company to make a decision on who would be providing services. To not have this means that company HR departments have been asleep at the wheel, right?