Sponsors must watch consultants, Labor Department says

Pension plan sponsors are responsible for selecting and monitoring pension consultants, including watching for potential conflicts of interest of service providers, the Labor Department announced today. Working with the SEC, the Labor Department "can ensure that conflicts of interest are disclosed and appropriately addressed," said Ann L. Combs, assistant labor secretary in charge of the Employee Benefits Security Administration said in a statement. Ms. Combs commended the SEC on its report, issued today, on the first "sweep" examinations of 24 pension consulting firms. There was "widespread" failure of pension consultants to keep copies of e-mail correspondence with clients and affiliates, Lori Richards, director of the SEC's office of compliance inspections and examinations, said at a news conference today. Consulting firms that failed to comply will receive deficiency letters, asking them to improve compliance or face enforcement action.