Tip of the Day: Retirement plans may be affected by TARP

I got another one for you to take to your legal eagles. According to a blog alert from Winston & Strawn, the Treasury Department will participate in a Public-Private Investment Program to buy up "legacy securities" (a much kinder, gentler term for "toxic assets").

If all goes right, fund managers will create a private investment vehicle with funds raised from private investors. So how do retirement plans fit in?

According to W&S, "This likely means that ERISA 'benefit plan investors' should be limited to 25% of any investment fund. Some managers may be willing to comply with the ERISA restrictions, in which case, assuming the structures can also be vetted for ERISA compliance, their investment fund could accept more than 25% of its investments from benefit plan investors."

I know the "ERISA compliance" part perked you up, so get your legal folks on it and comment back with your thoughts.

Tip of the Day

Read up on the new Treasury regulations on executive compensation. It may make for an awkward conversation with your CEO and CFO, but you’ll want to stay on the right side of the law on this one – particularly the limits on golden parachutes (you don’t want to look like another Lehman, do you?). Under the Emergency Economic Stabilization Act (also known as the $700 billion bailout plan), Treasury outlines exec comp guidelines for the Capital Purchase Program and the other two programs under the Troubled Assets Relief Program.