3969. What does a responsible plan fiduciary need to do to avoid the penalties of a prohibited transaction arising from a disclosure failure?Connie L Jumprcline202014-06-23T23:17:00Z2014-06-23T23:17:00Z23411948The National Underwriter Company1642285143969. What does a responsible plan fiduciary need to do to avoid the penalties of a prohibited transaction from a disclosure failure?Assuming a responsible plan fiduciary was not aware of a disclosure failure, the responsible plan fiduciary will not be subject to sanctions under the prohibited transaction rules. On discovery of the failure, however, the responsible plan fiduciary must take several actions to ensure that the proper disclosures are received. First, within 30 days of the discovery of the failure, the responsible plan fiduciary must request in writing that the service provider correct the deficiency. If the service provider does not provide the proper disclosures within 90 days of the request, the responsible plan fiduciary must provide a notice to the DOL of that failure within 30 days following the lapse of the 90 day request period. If the service provider affirmatively refuses to provide the requested information, the responsible plan fiduciary must notify the DOL within 30 days of that refusal.Labor Reg. §2550.408b-2(c)(1)(ix). The notice can be filed in paper format with the DOL, or by using the DOL’s online fee disclosure failure notice website located at http://www.dol.gov/ebsa/regs/feedisclosurefailurenotice.html.The notice sent to the DOL must contain certain information, including: (1)the name of the plan and plan number listed on Form 5500; (2)the plan sponsor’s name, address and phone number; (3)the name, address and telephone number of the responsible plan fiduciary; (4)the name, address, phone number, and, if known, the EIN of the service provider; (5)a description of the services provided to the plan; (6)a description of the deficiency in the disclosure failure; (7)the date the written request for the correction was made by the plan fiduciary; and (8)a statement as to whether the service provider is continuing to provide services to the plan. Planning Point: If the covered service provider does not provide appropriate disclosures within the 90 day period, and the requested disclosures relate to future services to be provided to the plan, the responsible plan fiduciary must take action to terminate the contract as quickly as prudently possible. PAGE