October 26, 1990
TO: INVESTMENT ADVISERS COMMITTEE NO. 36-90
RE: ERISA FIDUCIARY GUIDELINES FOR INVESTMENT ADVISERS
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As you recall, the Institute is concerned with recent
federal litigation against investment advisers to ERISA plans
(See Institute Memorandum to Investment Advisers Committee No.
18-90, dated June 5, 1990). In addition, the Department of Labor
Task Force on Enforcement recently stated that investment
management companies (excluding mutual funds) were among the
financial institutions which the Department would target for
purposes of enforcing ERISA rules and regulations.
In response to these developments, attached for your
comments are draft fiduciary contractual and procedural
guidelines for investment advisers who are ERISA plan
fiduciaries. The guidelines focus on ERISA's prudence and
diversification requirements, investments in mutual funds, proxy
voting and client directed brokerage. They generally do not
address the adviser's responsibility to ensure against entering
into prohibited transactions or ERISA bonding requirements.
Please give me any comments you have on the attached
guidelines by November 15, 1990. Since the Department of Labor's
Enforcement Task Force Report specifically identifies soft dollar
arrangements as an area of significant concern, I would
particularly appreciate any suggestions you have on this topic.
I look forward to hearing from you.
W. Richard Mason
Assistant General Counsel
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