WASHINGTON — Defined contribution plan fees will be the next frontier in Eliot Spitzer's war on mutual funds, sources predict.
New York Attorney General Eliot L. Spitzer has declared war on all mutual fund fees, including the notorious 12b-1 levies intended to pay for distribution and advertising, but also used to pay record keepers. Mr. Spitzer's actions could prompt the Securities and Exchange Commission and Labor Department to include investigations of fees paid by retirement plans.
"My prediction for next year is we will be revisiting 401(k) fees," said Steve Saxon, partner in the Groom Law Group, a Washington benefits boutique.
Robert Plaze, associate director in the SEC's investment management division, wouldn't confirm or deny that his agency will be investigating DC plan fees.
Already, the SEC has announced plans to review all rules and regulations governing the disclosure of fees by mutual funds. And SEC officials intend to strengthen regulations requiring mutual funds to more clearly disclose fee arrangements.