July 10, 2015

Submitted via email to e‐ORI@dol.go

Office of Regulations and Interpretations

Employee Benefits Security Administration

Attn:  Conflict of Interest Rule

Room N‐5655

U.S. Department of Labor

200 Constitution Avenue, NW

Washington, DC 20210

RE:  Comment Period for Definition of the Term “Fiduciary,” RIN 1210‐AB32

Dear Sir or Madam:

I am President and Chief Executive Officer of Alliance Benefit Group of Illinois, Inc. (dba ABG Retirement Plan

Services), an independent retirement plan provider headquartered in Peoria, Illinois.  Our firm serves

approximately 44,000 retirement plan participants in more than 600 daily valued defined contribution plans.  Our

client plans hold more than $3 Billion in retirement plan assets.  Plan sizes range from start‐up plans, many plans

with less than fifty participants, and plans with more than 1000 participants.

Our firm has served clients for more than 40 years with recordkeeping and TPA services, and we serve many plans

with investment advisory services (as a Registered Investment Advisor).  We are strongly supportive of the

Department of Labor’s effort to protect retirement plan participants with wide application of fiduciary

responsibility regulations to all those who service retirement plan participants.   

Although there are many advisors who provide cost effective and thorough service to plan participants and

beneficiaries, we have seen the results of predatory sales processes that entice participants to withdraw from

good retirement plans to be sold expensive annuity and other products with much less than full disclosure or

serious consideration of alternatives. We support the Department’s effort to eliminate abusive and self‐serving

services and contracts from being sold to retirement plan participants and to IRA participants.

The retirement plan industry is divided on this matter.  Many have said that the regulations will destroy the

opportunity for plan participants to receive needed guidance and services.  We believe with a few, small changes,

the proposed regulations will benefit American retirement plan savers. We hope that the Department of Labor –

Employee Benefits Security Administration will make adjustments to the proposed regulations that will resolve the

most critical objections that have surfaced, and will not be dissuaded in its efforts to issue final regulations.

There are two straightforward recommendations that our firm asks to be adopted as the regulations are finalized.

1.            We ask for a “Safe Harbor Level Compensation” definition as an alternative method of meeting the Best

Interest Contract Exemption.  The Exemption, as proposed, presents a substantial burden for most providers and

most advisors who service plans and participants.
We propose a “Safe Harbor Level Compensation” definition of a level, annualized, asset based compensation

payment of, perhaps 50 or 75 Basis points, which, when fully disclosed in writing, would serve as a simple and

reasonable safe‐harbor alternative to  the “Best Interest Contract” provisions.  The “Safe Harbor Level

Compensation” would include sales or advisory compensation paid directly, or indirectly, from a participant’s

retirement or IRA account to any party.  No contingent deferred sales charges would be allowed under the “Safe

Harbor Level Compensation” exemption.  

2.            The proposed change to the definition of education and advice included in DOL Interpretive Bulletin 96‐1

would have devastating effect on the ability to effectively serve retirement plan participants.  This change would

eliminate the ability of a service provider to describe a reasonable connection between generally accepted

investment principles and the specific funds included in a plan.   

Our education process encourages participants to select a risk based asset allocation model portfolio, using the

Designated Investment Alternatives in the plan in each model.  For example, if the model portfolio includes a 14%

allocation to the Large Growth investment style, the participant does not need to make the connection/decision to

allocate 14% to T. Rowe Price New America...the T. Rowe Price fund is shown as the Large Growth DIA that is

included in the model.

Removing the ability for an advisor to make the connection between a  general investment principle (Investment

Style) and a specific Designated Investment Alternative, and making that explanation a fiduciary act, will have the

consequence of eliminating this simple, low cost solution for plan participant investment elections.

We propose that an explanation of which specific funds meet generally accepted investment principles described

in participant education not be eliminated from the 96‐1 provisions as “education”.  This would only apply when

any fund so identified, is a Designated Investment Alternative (meeting the 408(b)(2) and 404(a)‐5 disclosure

requirements), AND, the advisor’s compensation is level among all Designated Investment Alternatives included in

the plan.  This change allows effective and helpful education without conflict of interest and allows less expensive,

non‐fiduciary participant service.  

We request that these two modifications be made to the proposed regulations.  We would be pleased to add to

the above information, or answer any questions.  We believe that strong, useful fiduciary regulation will be of

great benefit to all those who serve retirement plan assets and to those they serve.

Sincerely yours,

John D. Blossom Jr., MSPA, QPFC, AIF®

Registered FiduciaryTM

President and Chief Executive Officer

Alliance Benefit Group of Illinois, Inc.

(dba ABG Retirement Plan Services)

456 Fulton Street

Peoria, Illinois 61602

309‐671‐4200
cc: Phyllis Borzi

Assistant Secretary of Labor of EBSA

   

Joe Canary

Director, Office of Regulations and Interpretations, EBSA

Timothy D. Hauser

Deputy Assistant Secretary for Program Operations, EBSA

Judy Mares

Deputy Assistant Secretary, EBSA

Jeff Turner

Deputy Director, Office of Regulations and Interpretations, EBSA
Investor Profile - What kind of investor are you?

Select the appropriate number based on your answer to the questions:

 1 = Strongly Disagree 5 = Neutral 9 = Strongly Agree 

 3 = Disagree 7 = Agree

 Your Score:

1. To obtain above-average returns on my investments, 

I am willing to accept above-average risk of investment losses.

2. Staying ahead of inflation is more important to me than 

maintaining stable principal values.

3. If an investment loses money over the course of a year, 

I can easily resist the temptation to sell it.

4. I do not plan on withdrawing my retirement money 

for major expenses before I retire.

5. I consider myself knowledgeable about 

economic issues and personal investing.

6. When do you expect to retire:

1 = 5 years 5 = 10-15 years 9 = more than 20 years 

3 = 5-10 years 7 = 15-20 years 

 Total:

Score Key:

 6 to 16 Conservative Investor

 17 to 26 Moderately Conservative Investor

 27 to 36 Moderate Investor

 37 to 46 Moderately Aggressive Investor

 46 to 54 Aggressive Investor
PROFILE DESCRIPTION

CONSERVATIVE

You are uncomfortable with accepting a lot of 

risk and probably have only basic investment 

knowledge. You prefer to focus on 

preserving your savings with less of a need to 

grow your investment.

MODERATE CONSERVATIVE

You seek current income, but with moderate 

long-term capital appreciation. You want the 

potential for higher returns and are willing to 

accept some additional volatility. 

MODERATE

You have a reasonable understanding of how 

financial markets work; you seek a broad, 

diverse investment portfolio; you prefer to 

avoid losses, but can accept moderate risk 

and you look to preserve your savings while 

trying to have some investment growth.

MODERATE AGGRESSIVE

You have a good understanding of how 

financial markets work and you can accept 

some risk to achieve superior investment 

returns. 

AGGRESSIVE

You have a good understanding of financial 

markets. You are comfortable with taking 

risks with your savings to get substantial 

investment growth, even if prices go down in 

the short term. 
INVESTMENT ELECTION FORM 

Employee Name__________________________________________ Social Security #________________________

 RECOMMENDED INDEXED PLUS FUNDS MENU AS OF 3/31/15 

Signed this __________ day of ___________________________________, 20_______, we certify that the above 

information is accurate and correct. 

 ________________________________________ ____________________________________________ 

 (EMPLOYEE SIGNATURE) (EMPLOYER SIGNATURE) 

OR CHOOSE ONE RISK BASED TARGET MATURITY FUND EQUALING 100% 

flexPATH Target Date 2025 Index + (Choose Personal Risk Level)  Conservative  Moderate Aggressive 100% 

flexPATH Target Date 2035 Index + (Choose Personal Risk Level)  Conservative Moderate Aggressive 100% 

flexPATH Target Date 2045 Index + (Choose Personal Risk Level)  Conservative Moderate Aggressive 100% 

flexPATH Target Date 2055 Index + (Choose Personal Risk Level)  Conservative Moderate Aggressive 100% 

Each fund listed below is an investment option in your plan and is considered a 

Designated Investment Alternative (DIA). Each model listed to the right is 

designed to be an Asset Allocation Model (AAM) and not an investment option 

or DIA. Each model is designed on the basis of a participant’s investment 

objectives and risk tolerance (e.g. conservative, moderate growth). Each model 

allocates 100% of all contributions to the DIA’s in the plan. 

Conservative 

(7 yrs or less)* 

Moderate 

Conservative 

(5-10 yrs.)* 

Moderate 

(7-13 yrs)* 

Moderate 

Agg 

(10-15 yrs)* 

ressive 

Aggressive 

(12 yrs 

or more)* 

Custom 

Funds Investment      

Vanguard Growth Index Adm VIGAX Large Growth 6% 9% 11% 12% 14% % 

Vanguard 500 Index Adm VFIAX Large Blend Index 0% 0% 0% 0% 0% % 

DFA U.S. Large Value Portfolio I DFLVX Large Value 7% 11% 14% 16% 17% % 

Nicholas NICSX Mid-Cap Growth 0% 2% 2% 3% 4% % 

Vanguard Mid Cap Value Index Adm VMVAX Mid-Cap Value 2% 2% 4% 5% 6% % 

Vanguard Small Cap Growth Index Adm VSGAX Small Growth 0% 0% 2% 3% 4% % 

Vanguard Small Cap Value Index Adm VSIAX Small Value 0% 2% 3% 4% 5% % 

Vanguard REIT Index Adm VGSLX Specialty Real Estate 0% 2% 4% 5% 6% % 

DFA Commodity Strategy I DCMSX Broad Commodities 0% 2% 4% 5% 6% % 

DFA Large Cap Int’l Portfolio I DFALX Foreign Blend 5% 10% 14% 19% 23% % 

DFA Emerging Markets Portfolio I DFEMX Divers. Emerging Mkt 0% 0% 2% 3% 5% % 

BlackRock High Yield Bond BRHYX High Yield Bond 4% 3% 2% 0% 0% % 

Baird Aggregate Bond I BAGIX Interm. Term Bond 20% 15% 10% 10% 10% % 

DFA Inflation Protected Securities I DIPSX TIPS 16% 12% 8% 5% 0% % 

MetLife Stable Value - Class 0 METABG3 Stable Value 40% 30% 20% 10% 0% % 

MUST TOTAL 100% 100% 100% 100% 100% 100% 100% 
3 Mo 1 yr 3 yr 5 yr 3 Mo 1 yr 3 yr 5 yr 3 Mo 1 yr 3 yr 5 yr 3 Mo 1 yr 3 yr 5 yr 3 Mo 1 yr 3 yr 5 yr

2%

2% 8%

0%

DFEMX

10%

0%

Total Specialty: 0%

BlackRock Hi Yield Bond BRHYX 4%

BAGIX

5%

DFA Emerging Markets Portfolio I

Vanguard REIT Index Adm 0%

DFA Commodity Strategy I DCMSX 0%

7%

0%

ABG Index Plus Funds - Recommended

17%

0%

15%

0%

0% 0% 2%

5%

0%

14%

20% 25%

4%

2%

28%

0%

Nicholas

VIGAX

31%

4%

4%

10%

MetLife Stable Value - Class 0

Total Foreign Stock:

Vanguard Small Cap Value Index Adm

Total Small Cap:

VSIAX

VSGAX

4%

0% 2%

3%

20%

0%

9%

6%

5%

6%

17%

2%

2%

5%

DIPSX

VGSLX

100%

DFA US Large Value Portfolio I

23%

10%

4%

5%

6%

DFA Inflation Protected Securities I

Baird Aggregate Bond I

Vanguard Small Cap Growth Index Adm

NICSX

Total:

METABG3

Total Fixed Income:

DFLVX 7%

Vanguard Mid Cap Growth Val Idx Adm

20%

Total Mid Cap:

16%

6%

Model Portfolio Returns as of March 31, 2015

Conservative Aggressive

2.17% 5.87% 9.03% 9.07% 2.32% 5.81% 5.82% 11.60% 10.56%

Moderately Conservative

Conservative

Conservative Model weighted 

average Expense Ratio is 0.20%

Moderately Conservative Model 

weighted average Expense Ratio is 

0.21% 

Moderate Model average weighted 

Expense Ratio is 0.22%

 Moderately Aggressive Model average 

weighted Expense Ratio is 0.23%

Aggressive Model average weighted 

Expense Ratio is 0.25%

13%

VMVAX

Asset Allocation Models

Portfolio:

1.91% 5.84% 5.54% 6.67% 2.05%

Performance data does not represent historical returns as actively managed portfolio performance. Statistics are based upon historical performance of the funds included in the Asset Allocation Models in the % allocations shown below. 

Returns data does not include plan level fees which would reduce actual performance. Actual performance will be lower or higher than the performance shown here due to market fluctuations. For detailed information about each of the funds 

included, see the fund fact sheet and other information for each fund.

6.01% 7.45% 2.47%

Vanguard Growth Index Adm

Moderately 

Aggressive

9% 12% 14%

0%

100% 100% 100%

Moderate Moderately Aggressive

11%

10.29% 9.81%

3%

80%

40% 30%

2%

0%

60%

6%

100%

40% 25%

12%

10% 10%

8%

10%

5%

10% 14% 19%

19%

2% 4%

2% 4% 5%

5%

3%

4% 10% 13%

3% 2% 0%

16%

3%

0%

2%

Total Large Cap:

23%

0%

Aggressive

DFA Large Cap Intl Portfolio I DFALX 5% 10% 14%

Moderate

11%

Moderately 

Conservative

Vanguard 500 Index Adm VFIAX

8.00%

20%

4%

2%

10%

4%

60%

Moderately

Conservative

25%

6%

5%

14% 10%

40%

Moderate

28%

8%

19% 7%

13%

25%

Moderately

Aggressive 

13%

2%

5%

80%

Conservative

31%

10%

23% 9%

17%

10%

Aggressive