ERISA Benefit Plan Investment Management Agreements: Selecting 3(38) Investment Managers, Structuring the IMA

Documenting the Relationship to Minimize Risks for Plan Sponsors and Investment Advisers

Recording of a 90-minute CLE webinar with Q&A


Conducted on Tuesday, April 18, 2017

Recorded event now available

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Program Materials

This CLE webinar will review how best to negotiate and draft investment management agreements (IMAs) with ERISA retirement plan sponsors. The panel will explain best practices for selecting a 3(38) investment manager to reduce personal fiduciary risk and outline key steps in structuring and documenting the investment manager relationship.

Description

ERISA law requires plan fiduciaries to exercise the knowledge and experience of a prudent expert when making investment decisions. Breach of fiduciary duties under ERISA are subject to personal liability. ERISA Section 3(38) defines the investment manager to which the trustees can delegate their duties. An ERISA plan sponsor can delegate investment decisions to an ERISA 3(38) investment manager to mitigate liability and risk for investment decisions. Plan sponsors remain responsible for hiring and monitoring a 3(38) fiduciary and must exercise due diligence to ensure they meet their own fiduciary duty.

ERISA also imposes fiduciary obligations on ERISA investment managers, including the duty to avoid prohibited transactions with “parties in interest” to the ERISA plan, unless an exemption, such as QPAM, exists. However, the exemptions are nuanced, and fund managers must proceed carefully when taking advantage of the exceptions.

Listen as our authoritative panel of attorneys discusses ERISA 3(38) investment managers and offers guidelines for selecting investment managers, negotiating and drafting IMAs, and documenting the investment manager partnership from perspectives of both the plan sponsor and the investment manager.

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Outline

  1. Negotiating investment management agreements
  2. Drafting investment management agreements
  3. Documenting the investment management partnership

Benefits

The panel will discuss these and other key issues:

  • What standard of care should plans expect from an investment manager?
  • What representations and warranties should an IMA include?
  • What protections can side letters offer to plans?
  • What types of investments may warrant the use of a QPAM agreement?

Faculty

Sharon M. Goodman
Sharon M. Goodman

Principal
Slevin & Hart

Ms. Goodman focuses her practice on employee benefits law and has extensive experience in matters relating to...  |  Read More

David A. Russell, CFA
David A. Russell, CFA

Senior Investment Strategist, Senior Consultant
Investment Performance Services

Mr. Russell has over 35 years of investment and consulting experience. He works on all aspects of client funds...  |  Read More

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