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Complete Story
10/16/2020
401(k) plan hacked? Plan sponsors can't always blame the recordkeeper
Benefits Pro
Plan sponsors of corporate 401(k) accounts may be breathing a collective temporary sigh of relief after a U.S. District Court judge in Illinois recently rejected an argument that Abbott Laboratories was partially liable in the case of a former employee who had her retirement funds fraudulently withdrawn.
The recordkeeper or administrator of the 401(k) account – Alight Solutions, LLC – did not fare as well, and a suit against that company from the account participant remains in effect.
The ruling could have significant impact for plan sponsors, who earlier this year had been put on notice that they could share in any liability for individual 401(k) accounts that are hacked and potentially drained of funds.
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