The Department of Labor’s Amended ERISA QPAM Exemption Goes Live June 17, 2024

For advisers that rely on the Department of Labor (DOL) Prohibited Transaction Exemption 84-14 for Qualified Professional Asset Managers (QPAMs) under the Employee Retirement Income Security Act (ERISA), amendments to this exemption become effective on June 17, 2024.

The QPAM exemption suspends certain ERISA prohibited transaction rules for advisers managing or advising assets of retirement plans or individual retirement accounts, provided that they meet certain conditions.

The amendments modify the conditions for the QPAM exemption by:

• Increasing the size thresholds for determining whether an adviser qualifies for the QPAM exemption
• Requiring advisers intending to rely on the exemption to notify the DOL in advance
• Imposing new recordkeeping requirements
• Changing the process for advisers that have been convicted of certain crimes, including certain non-U.S. convictions, requiring notice to the DOL within 30 days and notice to retirement plans and IRA clients, allowing a one-year transition to address the disqualifying event, and application for an individual exemption with respect to the disqualifying event.

Our guidance

Most urgently, advisers should determine whether they are eligible and intend to rely on the QPAM exemption. If so, they need to provide the required notice to the DOL by September 15, 2024.

Going forward, advisers should consider implementing procedures to track their client agreements for any undertakings to comply with the QPAM exemption or obtain QPAM status. If they have agreed to obtain QPAM status, they should track their ongoing eligibility for the QPAM exemption, as well as their compliance with its requirements.

How we help

The compliance environment has never been more complex or demanding. We can help you to navigate the evolving regulatory landscape while considering the complexity of your firm’s unique compliance requirements. ACA Signature can help.

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Reach out to your ACA consultant, or contact us to find out how ACA Signature can help transform your firm’s compliance program.

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