DOL Investigators Ask for Copies of Investment Policies (Posted July 31, 2001) Technical Tip 17: The following question and answer are from the DOL Q&A Session at the 2000 ASPPA Annual Conference: I have heard that the PWBA is asking for copies of investment policy statements when it conducts investigations. Is that true? If so, what is the PWBA’s interest? If not, what is the PWBA’s view about whether retirement plans should--or are required to--have investment policies? DOL Response: As part of the investigation, investigators and auditors will ask for copies of investment policy statements. Investment guidelines are part of the documents and instruments governing the plan, such as the plan document, trust agreements, and summary plan descriptions. As a document and instrument governing the plan, it provides DOL with provisions on how a plan operates so that investigators can, as part of their investigation, determine whether the plan fiduciaries are following the terms of the plan. While ERISA does not require that the plan have an investment policy, such policies are encouraged because they help assure investments are made in a rational manner and in furtherance of the plan’s funding policy. Most plan fiduciaries are involved in the decision making process of investments by their plan. As such the investment policy provides guidance to the fiduciaries as they perform their fiduciary responsibilities. If a plan has an investment policy it is expected that the plan fiduciaries adhere to it unless to follow the policy would be contrary to ERISA. Caveat: The answer was drafted by Fred Reish and Brad Huss, the program moderators, based on their understandings of discussions with four senior officials of the Pension and Welfare Benefits Administration (PWBA) of the U.S. DOL. As a result, it does not represent a formal or binding position statement by the PWBA. View all Tips © 2012 Reish Luftman Reicher & Cohen, a Professional Corporation Important notice: Answers are provided as general guidance on the subjects covered in the question and are not provided as legal advice to the questioner's situation. Any legal issues should be reviewed by your legal counsel to apply the law to the particular facts of your situation.