Many of our industry’s institutional investors act as investment managers for pension plans. As such, they are subject to the Employee Retirement Income Security Act (ERISA), a federal law that sets the minimum standards for retirement plans in private industry, including imposing specific duties these investment managers must meet. Our investor community takes these responsibilities with the utmost seriousness and attention. Therefore, having a clear understanding of ERISA rules is paramount.

“In FY 2013, ERISA encompassed roughly 684,000 retirement plans, 2.4 million health plans and 2.4 million additional welfare benefit plans. These plans cover about 141 million workers and beneficiaries and include more than $7.6 trillion in assets. About 54 percent of America’s workers earn retirement benefits on the job, and 59 percent earn health benefits.” – U.S. Department of Labor

Since ERISA’s enactment in the 1970s, the structured finance market has experienced significant development, more than the drafters likely could have ever envisioned. The Department of Labor has addressed many of these developments through a patchwork of amendments and exemptions; however, there remain some ambiguities among various provisions and exemptions as well as unforeseen impediments that in certain circumstances have the potential to limit otherwise suitable investment opportunities for pension plan clients.