Executives at many defined contribution plans, wary of the scandals that have rocked the mutual fund industry, are putting their providers under a microscope to ensure they are untainted.
One plan — the $1.9 billion Maryland Supplemental Retirement Agency, Baltimore — helped create a list of specific questions to ask mutual fund companies on market timing, late-day trading, redemption fees and related activities. "The first thing was to have a list of questions to open the discussion with our current investment providers," said Michael Halpin, executive director.
Mr. Halpin said the questions were "a collaborative effort" by the Maryland fund; its consultant, The Segal Co., New York; defined benefit plan officials from the $27 billion State Retirement & Pension System of Maryland, Baltimore; Ennis Knupp + Associates, Chicago, consultants to the Maryland state retirement system; and Nationwide Retirement Solutions, Columbus, Ohio, the DC plan's administrator.
"We thought it would be good to come up with key pieces of information to get from investment managers of the fund…," said John DeMairo, chief operating officer and senior vice president of Segal Advisors Inc.