Skip to main content
MENU
Subscribe
  • Subscribe
  • Account
  • LOGIN
  • Topics
    • Alternatives
    • Consultants
    • Coronavirus
    • Courts
    • Defined Contribution
    • ESG
    • ETFs
    • Hedge Funds
    • Industry Voices
    • Investing
    • Money Management
    • Opinion
    • Partner Content
    • Pension Funds
    • Private Equity
    • Real Estate
    • Russia-Ukraine War
    • SECURE Act 2.0
    • Special Reports
    • White Papers
  • Rankings & Awards
    • 1,000 Largest Retirement Plans
    • Top-Performing Managers
    • Largest Money Managers
    • DC Money Managers
    • DC Record Keepers
    • Largest Hedge Fund Managers
    • World's Largest Retirement Funds
    • Best Places to Work in Money Management
    • Excellence & Innovation Awards
    • Eddy Awards
  • ETFs
    • Latest ETF News
    • Fund Screener
    • Education Center
    • Equities
    • Fixed Income
    • Commodities
    • Actively Managed
    • Alternatives
    • ESG Rated
  • ESG
    • Latest ESG News
    • The Institutional Investor’s Guide to ESG Investing
    • Climate Change: The Inescapable Opportunity
    • Impact Investing
    • 2022 ESG Investing Conference
    • ESG Rated ETFs
  • Defined Contribution
    • Latest DC News
    • DC Money Manager Rankings
    • DC Record Keeper Rankings
    • Innovations in DC
    • Trends in DC: Focus on Retirement Income
    • 2022 Defined Contribution East Conference
    • 2022 DC Investment Lineup Conference
  • Searches & Hires
    • Latest Searches & Hires News
    • Searches & Hires Database
    • RFPs
  • Performance Data
    • P&I Research Center
    • Earnings Tracker
    • Endowment Returns Tracker
    • Corporate Pension Contribution Tracker
    • Pension Fund Returns Tracker
    • Pension Risk Transfer Database
    • Future of Investments Research Series
    • Charts & Infographics
    • Polls
  • Careers
  • Events
    • View All Conferences
    • View All Webinars
    • 2022 Innovation Investing Conference
    • 2022 Defined Contribution East Conference
    • 2022 ESG Investing Conference
    • 2022 DC Investment Lineup Conference
    • 2022 Alternatives Investing Conference
Breadcrumb
  1. Home
  2. COURTS
December 23, 2015 12:00 AM

Insperity 401(k) plan sued for excessive fees, imprudent investments

Robert Steyer
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    Insperity Inc. has been sued by participants in an Insperity 401(k) plan sold to small- and midsized employers that alleged the company and its subsidiaries charged “excessive” record-keeping fees and made other fiduciary breaches of ERISA. The complaint, filed Tuesday, also alleges that Reliance Trust Co., the discretionary trustee for the plan, breached its fiduciary duties by allegedly making “imprudent” investment decisions.

    The lawsuit, Pledger et al. vs. Reliance Trust Co. et al., was filed in U.S. District Court in Atlanta. The suit seeks class-action status for more than 50,000 participants in the Insperity 401(k) Plan.

    The suit cites only the $2.05 billion 401(k) plan sold to employers by Insperity, a company that provides outsourced human resources services. The 401(k) plan sponsor and fiduciary is an Insperity subsidiary called Insperity Holdings Inc.

    The plaintiffs are four participants in this plan for Insperity clients, but the clients aren't identified in the complaint. The lawsuit does not affect Insperity's $208.6 million plan for its own employees, the Insperity Corporate 401(k) plan.

    The participants claim one example of a fiduciary breach was Insperity's October 2003 decision to hire an Insperity subsidiary — Insperity Retirement Services — as record keeper for the 401(k) plan, “rather than obtaining bids,” according to the complaint by participants, whose lead counsel is Jerome Schlichter, the founding and managing partner of Schlichter, Bogard & Denton.

    “The amount paid by plan participants for record-keeping services was, and is, excessive for the services provided,” the complaint said. “Defendants failed to rebate to plan participants excessive payments (through a revenue-sharing arrangement) that exceeded a reasonable flat per participant record-keeping fee.”

    This effort, the complaint said, meant that the defendants acted in their own interests “at the expenses of the participants.”

    The complaint cited Reliance Trust in its role as discretionary trustee for its responsibility “for selecting, retaining and monitoring of investment options.” Reliance Trust “selected and retained its own high-cost and poorly performing” investments that paid asset-based revenue sharing to the Insperity record-keeping subsidiary, the complaint said.

    In an interview, Mr. Schlichter pointed out that Reliance Trust selected its own target-date fund series for the plan, two days after the series was made available to clients. The various alleged fiduciary breaches by Reliance Trust and Insperity caused participants to lose money from their retirement accounts, he said.

    Representatives from Insperity and Reliance Trust could not be reached for comment.

    Related Articles
    Appeals court affirms dismissal of lawsuit against State Street on management o…
    Principal 401(k) participants settle with company on excessive fees claim
    Fidelity targeted in another ERISA class-action suit
    Anthem 401(k) plan participants sue company over higher fees
    Recommended for You
    ONLINE_180709926_AR_0_SPVGDZVTUNPE.jpg
    Barnabas Health settles ERISA complaint for $1.75 million
    The Goldman Sachs & Co. logo is displayed at the company's booth on the floor of the New York Stock Exchange on July 19, 2013
    Goldman Sachs agrees to $79.5 million settlement on 1MDB lawsuit
    ONLINE_180539987_AR_0_AJVEYGQPKZAX.jpg
    Nextep, former participants reach deal to settle ERISA lawsuit
    Alternatives: Investing Across the Spectrum
    Sponsored Content: Alternatives: Investing Across the Spectrum

    Reader Poll

    May 9, 2022
    SEE MORE POLLS >
    Sponsored
    White Papers
    Are Factors a Thing of the Past?
    Q2 2022 Credit Outlook: Carry On
    Leverage does not equal risk
    Is there a mid-cap gap in your DC plan?
    Out of the Shadows: The Revolution in Shadow Accounting
    The pivotal role of fixed income markets in the ESG revolution
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today
    May 9, 2022 page one

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    130 E. Randolph St.
    Suite 3200
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Content Solutions
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2022. Crain Communications, Inc. All Rights Reserved.
    • Topics
      • Alternatives
      • Consultants
      • Coronavirus
      • Courts
      • Defined Contribution
      • ESG
      • ETFs
      • Hedge Funds
      • Industry Voices
      • Investing
      • Money Management
      • Opinion
      • Partner Content
      • Pension Funds
      • Private Equity
      • Real Estate
      • Russia-Ukraine War
      • SECURE Act 2.0
      • Special Reports
      • White Papers
    • Rankings & Awards
      • 1,000 Largest Retirement Plans
      • Top-Performing Managers
      • Largest Money Managers
      • DC Money Managers
      • DC Record Keepers
      • Largest Hedge Fund Managers
      • World's Largest Retirement Funds
      • Best Places to Work in Money Management
      • Excellence & Innovation Awards
      • Eddy Awards
    • ETFs
      • Latest ETF News
      • Fund Screener
      • Education Center
      • Equities
      • Fixed Income
      • Commodities
      • Actively Managed
      • Alternatives
      • ESG Rated
    • ESG
      • Latest ESG News
      • The Institutional Investor’s Guide to ESG Investing
      • Climate Change: The Inescapable Opportunity
      • Impact Investing
      • 2022 ESG Investing Conference
      • ESG Rated ETFs
    • Defined Contribution
      • Latest DC News
      • DC Money Manager Rankings
      • DC Record Keeper Rankings
      • Innovations in DC
      • Trends in DC: Focus on Retirement Income
      • 2022 Defined Contribution East Conference
      • 2022 DC Investment Lineup Conference
    • Searches & Hires
      • Latest Searches & Hires News
      • Searches & Hires Database
      • RFPs
    • Performance Data
      • P&I Research Center
      • Earnings Tracker
      • Endowment Returns Tracker
      • Corporate Pension Contribution Tracker
      • Pension Fund Returns Tracker
      • Pension Risk Transfer Database
      • Future of Investments Research Series
      • Charts & Infographics
      • Polls
    • Careers
    • Events
      • View All Conferences
      • View All Webinars
      • 2022 Innovation Investing Conference
      • 2022 Defined Contribution East Conference
      • 2022 ESG Investing Conference
      • 2022 DC Investment Lineup Conference
      • 2022 Alternatives Investing Conference