Massive $10 Billion Lawsuit Targets 401(k)-Type Pension Plan
A US law firm has found a new and growing revenue source; Suing businesses with 401(k)plans stocked with hidden and “not-so-hidden” fees deducted from employees’ 401(k) assets. This is not a minor issue. Millions of dollars are being skimmed and sliced off 401(k) plans’ assets daily across the country to pay various 401(k) providers and financial advisors.
We have written about this problem of 401(k) fees extensively. Our website is dedicated to the proposition that 401(k) fees should be illegal. Employers should pay the full freight for carrying the cost of the company’s 401(k) plan. Employers who have employees’ paying these fees are the ones getting sued.
There is no reason why the participants in the 401(k) plans should shoulder the cost of these plans. The people who save more money in the company’s 401(k) are shouldering more of the cost on a percentage basis. Does that seem fair?
This lawsuit seeking $10 Billion in damages may be the largest to date, but by no means is it the last one you will be reading about. This litigation represents the tip of a massive iceberg. More 401(k) participants begin to understand how they are being ripped off by 401(k) providers who skim fees from retirement savings. The growl you hear now will become an ear-splitting roar—Mark our words.