[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3642 Introduced in House (IH)]







107th CONGRESS
  2d Session
                                H. R. 3642

To amend title I of the Employee Retirement Income Security Act of 1974 
 to require plan administrators of 401(k) plans to provide semiannual 
    reports to participants and beneficiaries fully and accurately 
   disclosing the financial health of the plan sponsor and promoting 
          diversification of investment of their plan assets.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 29, 2002

  Mr. Bonior introduced the following bill; which was referred to the 
                Committee on Education and the Workforce

_______________________________________________________________________

                                 A BILL


 
To amend title I of the Employee Retirement Income Security Act of 1974 
 to require plan administrators of 401(k) plans to provide semiannual 
    reports to participants and beneficiaries fully and accurately 
   disclosing the financial health of the plan sponsor and promoting 
          diversification of investment of their plan assets.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``401(k) Pension Right to Know Act of 
2002''.

SEC. 2. SEMIANNUAL REPORTS PROMOTING DIVERSIFICATION AND DISCLOSING 
              PLAN SPONSOR'S FINANCIAL HEALTH.

    Section 404 of the Employee Retirement Income Security Act of 1974 
(29 U.S.C. 1104) is amended by adding at the end the following new 
subsection:
    ``(e)(1) The plan sponsor of an individual account plan that 
includes a cash or deferred arrangement (as defined in section 
401(k)(2) of the Internal Revenue Code of 1986) shall provide 
semiannually a written notice to each participant or beneficiary--
            ``(A) setting forth a full and complete disclosure of the 
        financial health of the plan sponsor, and
            ``(B) advising participants and beneficiaries of the 
        importance of diversifying the investment of the assets in 
        their accounts and of the risk of holding in their portfolios 
        securities of any one entity, including employer securities.
    ``(2) The written notice required under paragraph (1) shall be in 
such form as may be prescribed in regulations of the Secretary.
    ``(3) Any failure by a plan administrator to carry out the 
requirements of paragraph (1) shall be treated as a failure by the plan 
administrator to carry out the plan administrator's fiduciary duties 
under subsection (a)(1). Subsection (c)(1)(B) shall not apply with 
respect to liability of the plan administrator in connection with any 
loss resulting from a participant's or beneficiary's exercise of 
control of the assets in his or her account in the absence of full and 
complete disclosure by the plan administrator as required under 
paragraph (1).''.

SEC. 3 EFFECTIVE DATE.

    The first written notice issued by a plan administrator in 
connection with any plan pursuant to the amendment made by this Act 
shall be issued not later than 30 days after the first day of the first 
plan year beginning after 60 days after the date of the enactment of 
this Act.
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