Compliance News | March 14, 2022
The DOL has taken an extremely strong position against plan fiduciaries including cryptocurrencies as investment options in self-directed 401(k) plans. The DOL cautions plan fiduciaries to exercise extreme care before including such investments in a plan’s portfolio, including in brokerage accounts.
The DOL also indicates that it will create an investigative program targeted at plans that include cryptocurrency investment options.
On March 10, 2022, DOL issued Compliance Assistance Release No. 2022-01. The guidance points out that:
In the Compliance Release, the DOL specifies some of the facts and circumstances that it expects plan fiduciaries to consider and warns fiduciaries to be extremely cautious. The DOL also states its belief that, at least with respect to cryptocurrencies, a fiduciary has a duty to look at whether what is being offered under a brokerage window is prudent.
The DOL warns plan fiduciaries who do not follow the Compliance Release and decide to include cryptocurrencies in their plan’s portfolio can expect a DOL investigation.
This page is for informational purposes only and does not constitute legal, tax or investment advice. You are encouraged to discuss the issues raised here with your legal, tax and other advisors before determining how the issues apply to your specific situations.
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