Massachusetts Financial Services Co. agreed to settle a class action by employees challenging the affiliated mutual funds in their 401(k) plans. The lawsuit accuses MFS of mismanaging the plans, which together hold more than $500 million, by offering high-cost funds affiliated with the company and by failing to investigate lower-fee options. More than 99 percent of the plans’ assets were held …
Wells Fargo faces a new lawsuit claiming 401k self-dealing on the part of $3 billion of employee retirement savings. Plaintiffs allege the company funneled 401k plan assets into “expensive, under-performing” proprietary target date funds to enrich itself. Reuters reports the proposed class-action lawsuit, filed on Tuesday in federal court in Minnesota, accused the third-largest U.S. bank of steering 401(k) contributions to its Wells Fargo Dow Jones Target Date funds. The lawsuit, filed by employees, seeks to “recoup excess fees and unrealized profits stemming from Wells Fargo’s alleged breach of fiduciary duties to all 401(k) participants over the last six years,” according to the complaint. It added that Wells Fargo’s target date funds cost 2.5 times more than similar funds from …