Two high-profile retirement plan fiduciary experts have formed a new venture “to serve as an independent, operational fiduciary for group plan arrangements.”
Group Plan Systems (GPS) is the brainchild of the Pension Resource Institute’s (PRI) Jason Roberts and Waypoint Fiduciary’s Pete Swisher.
“I’ve always aimed at being at independent fiduciary …and therefore a pooled plan provider, a 3(16) administrator, a 402(a), as some people would call it; we give it a variety of names that probably misstate what it actually is,” Swisher said. “How do you cost-effectively add scale in a way that is sensible for the future of the market? We have some fairly clunky structures, so Jason and I have been talking and launched GPS. We registered with the DOL as a pooled plan provider.”
Claiming fortuitous timing, he added that some vendors and recordkeepers have had misgivings about MEPs and PEPs because of the compliance risks and burdens, and some were focusing instead on the “group of plans” (GoP) approach, but the DOL’s proposed regulations on GoP audits may have refocused attention on PEPs.
“If you look at the need for fiduciary oversight, the operational piece is missing,” Swisher explained. “Most employers will hire a recordkeeper or TPA, and whatever the TPA’s process might be is, therefore, the company’s process, and they have no knowledge of how to supervise that. It’s a big gap and specifically the one we’re filling.”
He described the firm as an “overlay that is highly scalable and efficient,” something with which the industry must reckon to realize the long-term potential of group plans.
Or, more simply, GPS believes that the retirement plan industry has done an excellent job of supporting employers in managing investments yet still has room to grow in terms of helping them from an operational perspective.
“We ask questions,” Swisher said. “What are the [fiduciary] requirements, how do they get done, and who’s responsible for the various pieces? When we’re done with that, we look at their contract with the recordkeeper, and invariably there are holes.”
For that reason, the firm serves in various capacities, including a pooled plan provider for PEPs, named fiduciary on group or individual plans, and consulting to help others bring their solutions to market.
“Pete knows more about the operational details of group retirement plans than anyone I’ve met in my career,” Roberts concluded. “He has helped a number of PRI member firms establish successful MEPs, and we began discussing a partnership in early 2020, shortly after SECURE Act created Pooled Employer Plans (PEPs).”
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With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
