ERISA 408(b)(2) Fee Disclosure Notice
Segal Rogerscasey is providing you with this notice in compliance with the Department of Labor regulations under section 408(b)(2) of the Employee Retirement Income Security Act of 1974, as amended, (“ERISA”), to disclose information about the consulting, investment advisory, and investment management services we provide to pension plans and the compensation we receive for such services. This statement is intended to be read in conjunction with our Form ADV Part 2 (available at http://www.adviserinfo.sec.gov) and our retainer agreement with your Plan (your “Agreement”).
Description of Services
Segal Rogerscasey offers a wide range of consulting, investment advisory, and investment management services. For more information regarding the specific services that we provide your Plan, please review your Agreement and Item 4 (“Advisory Business”) of our Form ADV Part 2.
Service Provider’s Status
Depending on the services that we agree to provide your Plan, we may be acting as a fiduciary under ERISA. In such case, we will acknowledge such fiduciary status in your Agreement. Moreover, we will be acting as a registered investment adviser under the Investment Advisers Act of 1940, as amended when providing our services.1
Your Plan may pay Segal Rogerscasey directly for consulting, investment advisory, and investment management services contemplated in your Agreement in the following four ways:
- Negotiated annual retainer: Your Plan may agree on an amount, generally payable in monthly installments, covering specified services. The negotiated amount may be stated in dollars or as a percentage of assets.2
- Project work: Your Plan may agree to a flat fee for specific projects.
- Performance Fees: Your Plan may agree to pay Segal Rogerscasey based on the investment performance of a portfolio as measured against an agreed-upon benchmark. For example, your Plan might agree to pay a percentage of the outperformance of its portfolio. Alternatively, your Plan might agree to pay an annual bonus solely at the Plan’s discretion. A performance fee provision is generally in addition to a negotiated annual retainer amount.
- Hourly Time Charges: You may agree to periodic billings based on our hourly rates. A client may agree to use any combination of these direct payment methods. Your specific arrangement, including the manner in which these fees will be received by us, is detailed in your Agreement or described in other communications between us and you. If you would like a copy of your most recent Agreement (or such other communications), please call your Segal Rogerscasey representative. A list of our offices appears here.
Segal Rogerscasey may receive the following types of compensation:
- Annuity Commissions: From time to time, our affiliate, The Segal Company, is asked to help a client obtain an individual annuity for a participant in the client’s plan. In those cases, Segal Rogerscasey is asked to obtain the annuity quote. Segal Rogerscasey does not receive commissions directly from the insurers for obtaining quotes and relaying this information to the Segal Company client, but we receive the commission received by The Segal Company under an intercompany agreement if the annuity is purchased. Plan clients have the option to seek annuity quotes and to purchase annuities and other insurance products through insurance brokers and agents that are not affiliated with our firm. The insurer pays three percent (3%) of the “gross consideration” or cost of the annuity. For example, if the price a client pays for an annuity is $1,000.00, the insurer pays three percent of that amount as a commission, or $30.00. Our compensation for this limited annuity placement service has been at the most, one-half of one percent of the annual revenue of Segal Rogerscasey.
- Research and Consultant Summit: Segal Advisors acquired the business of Rogerscasey in February 2012. For 18 years, Rogerscasey has sponsored a Research and Consultant Summit and certain investment managers pay to belong to the Summit. The membership entitles representatives to attend two conferences each year and provides access to educational material, whitepapers and research pieces for a fee. The membership is not dependent on, and does not affect or influence the advice, recommendations or other services that we provide. Our compensation represents less than 1/20 of one basis point of the assets under advisement of the firm. For a list of current members, please contact your client service representative.
- Gifts, gratuities, and non-monetary compensation: From time to time, third-party vendors (such as product providers, mutual fund companies, broker-dealers, etc.) may provide Segal Rogerscasey (and its affiliates) with non-monetary gifts and gratuities, such as promotional items (i.e., coffee mugs, calendars, or gift baskets), and access to certain industry related conferences and meals associated with those conferences (collectively, “gifts”). Segal Rogerscasey has implemented policies and procedures intended to identify, quantify, and track gifts received by it and its affiliates. Pursuant to rules established by the Department of Labor, Segal Rogerscasey has implemented a policy for allocating the value of a gift among multiple clients, where applicable. Under such policy, where potentially reportable compensation is received by Segal Rogerscasey (including its affiliates) in connection with several clients, Segal Rogerscasey will first divide the fair market value of such gift by the number of individual clients to which such gift is reasonably applicable and then allocate the result to each affected client to determine if it exceeds the de minimis threshold under the Section 408(b)(2) regulation and related and associated guidance. Based on historic trends, Segal Rogerscasey does not expect to receive gifts in excess of the de minimis threshold under the regulations with respect to your Account.
Compensation for Termination of Your Account
We do not receive a termination fee or apply a penalty when your account’s enrollment in either program is terminated.