Quarterly Update for Benefit Plan Sponsors - 2nd Quarter 2006

The Department of Labor has expanded and simplified its Voluntary Fiduciary Correction Program (VFCP), which enables employers and their financial advisors to voluntarily correct violations of the Employee Retirement Income Security Act of 1974 (ERISA). Under the program, plan sponsors can receive a “no action” letter for violations if they fully correct all violations, restore to the plan any losses or profits with interest and distribute supplemental benefits owed to eligible participants and beneficiaries. The VFCP updates expand coverage of violations relating to participant loans, expenses improperly paid from the plan and illiquid assets.