Worker 401(k) fee suits find friend in Labor Department

[Omaha Steve]

Source: Financial Week

DOL weighs in, backing right of Deere employees to sue company and Fidelity over fees, revenue sharing

By Mark Bruno

The Department of Labor has sent a quiet but strong signal that it is keeping a close watch on the growing collection of 401(k) fee lawsuits—and that it will intervene in these cases if it deems necessary.

Without much fanfare, the Labor Department recently elected to formally voice its position on a ruling over a 2006 lawsuit that workers at Deere & Co. filed against the company and Fidelity Investments (see “At Deadline,” FW, March 24).

That suit, which alleged 401(k) participants at Deere were being charged unreasonable and undisclosed fees and expenses, was dismissed by a federal judge last June, a move that was viewed as good news for the roughly dozen other corporations that have been hit with similar suits over 401(k) fees, including Exelon, Lockheed Martin and General Dynamics.

But now the Labor Department is saying not so fast. On March 19, it filed a brief in the 7th U.S. Circuit Court of Appeals requesting that the judge’s earlier ruling be reversed in appeals court, where the case has been since the end of last year.


Read more: http://www.financialweek.com/apps/pbcs.dll/article?AID=/20080331/REG/55455150

[elleng]

1. interesting

that chao's dol would do this.

[Lasher]

3. That was my first reaction.

:wtf:

There's tons of money being skimmed off the top and it's been going on for a long time. Maybe Chao is trying to change her spots on behalf of the administration, just in time for the general election campaign.

[NashVegas]

2. "Gotcha Capitalism"

Bob Sullivan calls the hidden fees of 401(k)s one of the best scams going, and says managers are skimming up to 1/3 of the profit totals. If the Fed wants to privatize SS, it can't go to 401(k)s the way they're currently operating.

[SharonAnn]

4. That's why there's a push to "privatize" Social Security. Large fees to be made!