While individuals should always be wary of rogue service providers, retirement plan sponsors should be even more wary. While negligent or criminal retirement plan service providers are to blame for their transgressions, plan sponsors as plan fiduciaries are ultimately responsible for the work of their service providers. As plan fiduciaries, plan sponsors and the trustees for their plan have fiduciary responsibility. These responsibilities include: acting solely in the interest of plan participants and their beneficiaries and with the exclusive purpose of providing benefits to them; carrying out their duties prudently; following the plan documents (unless inconsistent with the law); diversifying plan investments; and paying only reasonable plan expenses.

The problem with fiduciary responsibility, is that not only is a fiduciary concerned with their job, they also are responsible for the jobs they delegated to third parties, and may be liable for things that they may be unaware of and that were done without their malice to plan participants.