Plan sponsors are often surprised to learn that when their advisor, TPA, and recordkeeper disagree, the conflict doesn’t protect the plan sponsor—it exposes them.
ERISA places fiduciary responsibility squarely on the employer. That means if one provider says something is fine and another raises concerns, ignoring the issue or picking the most convenient answer can create real risk. Regulators and courts don’t care which provider was “supposed” to handle the issue. They care whether the sponsor acted prudently.
This shows up most often with operational failures: late deposits, missed eligibility, incorrect matches, or forfeiture mistakes. Each provider may see only part of the problem, but the sponsor owns the whole picture.
The smartest move isn’t to referee arguments. It’s to document them. Ask providers to put their positions in writing, evaluate the risks, and make a reasoned decision. Silence or informal assurances are rarely defensible after the fact.
Sponsors who treat provider disagreement as a warning sign—rather than a nuisance—are usually the ones who avoid bigger problems later.
