US. MIT agrees to pay $18 million in suit over retirement plan fees
St. Louis law firm Schlichter Bogard & Denton has reached an $18.1 million settlement with the Massachusetts Institute of Technology in a lawsuit over the university’s 401(k) retirement plan.
The firm, headed by Jerome Schlichter, sued the university in 2016 on behalf of employees and retirees.
The suit accused MIT of paying excessive record-keeping fees to Fidelity Investments and failing to monitor the plan’s investments.
The lawsuit pointed out that Fidelity’s chief executive was an MIT trustee, and that Fidelity donated hundreds of thousands of dollars to the university while managing its retirement plan.
In addition to paying $18.1 million, the proposed settlement calls for MIT to train employees on their fiduciary duty and request proposals from record keepers who will charge a flat fee rather than a percentage of plan assets.
“MIT employees and retirees will now benefit from an improved plan that works on their behalf and enables them to build their retirement assets for the future,” Schlichter said in a statement.
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