On this special ERISA Watch episode, our host Elizabeth Hopkins examines the upcoming Supreme Court argument in the Hughes v. Northwestern University case, which will be held on Monday December 6, 2021. In Hughes, participants in a defined-contribution retirement plan allege the plan paid too much in fees for the investments offered, but the lower courts dismissed without even considering the merits of the case.
Elizabeth speaks to Former Assistant Secretary of Labor, Phyllis Borzi, about the importance the of the investment fee issue and why it matters to anyone with a pension. They discuss how paying too much in fees over the course of a career can potentially cut retirement income for an individual by over one-third, and how management companies are profiting to the tune of many millions of dollars per year by skimming from retirement plans.
Paying the vig in this instance might not implicate loan sharks and bookies, but with all of the risk on the plan participants and none of it on the employer and investment managers, the end result of the cuts being taken might not look all that different.