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JudyS

Spark Institute, Anyone?

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Fellow Travelers...

 

On the home page there is a comment from the Spark Institute asking for a pre-approved 403(b) prototype. So I went to the SPARK homepage and poked around a little and looked at their Comments and Materials section. Perhaps I am misreading something... These guys do not appear to me to be on the same side of the fence as most of us here. Does anyone else have an idea or knowledge of these fine folks?

 

JudyS

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Tom --

 

They appear to be a lobbying group, if I understand their website fully. I have to wonder if the standard form they are asking for would benefit the industry members more than us. Just wondered if anyone read their actual recommendation.

 

After posting here, I went back to the website and while there I found a copy of the testimony they are submitting to a DOL hearing -- last week, I think. It appears most certainly NOT friendly to plan participants. They seek to dodge full disclosure in many ways, according to what I understood.

 

JudyS

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SPARK is a trade group for TPAs, historically for those working in 401(k) marketplaces. So, no, they do not represent the interests of participants or employers.

 

It is a sad fact that everybody is busily grinding their own axes. I saw this go on recently in connection with a data standards project, which showed me a bias towards individual annuity issuers as a result of which more than a few participants are going to get unpleasant surprises down the road.

 

On the other hand, somebody has to manage the monstrosities that are going to exist under the final regulations, and participants and employers will be much better off if there are new entrants into the marketplace for 403(b) services, and TPAs from the 401(k) universe are the best candidates. A 403(b) environment that reflects their needs will bring more of them in.

 

I hold no brief for SPARK, NTSAA, NAGDCA or ASPPA when they act as advocates or otherwise get involved in the legislative or regulatory process. In fact, I often disagree sharply with their analyses and their activities, as witness my comment above about data standards. They do, however, through their accreditation programs, provide educational facilities that create a competent pool of workers for the retirement plan industry.

 

The bottom line is that you have to take everything anybody says with a grain of salt.

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