As cyber theft from retirement accounts rises, plan sponsors need to act on the guidance issued this spring by the Employment Benefits Security Administration (EBSA). Importantly, this includes communicating with plan participants about protecting their accounts.
Crimes Targeting Retirement Accounts
EBSA has emphasized that plan sponsors and fiduciaries must mitigate cybercrime risks and provided guidance in three parts: Tips for Hiring a Service Provider; Cybersecurity Program Best Practices; and, Online Security Tips. Recently, a story about how easily $40,000 was stolen from a couple’s retirement account underscored the importance of sharing the Online Security Tips with all plan participants. As a financial and cyber services expert told NBC Chicago:
“Cyber theft from retirement accounts is a growing concern. In the US, people tend to hold a substantial amount of their wealth in a retirement account so they are relatively high-value targets….Customers often re-use the same passwords for different accounts, which increases the likelihood of their credentials being available for sale on the dark web.”
Plan sponsors who have not already done so, will want to educate employees and plan participants about the basics of online security. The Tips from EBSA include important points about how to:
- Register, Set Up and Routinely Monitor Your Online Account
- Use Strong and Unique Passwords
- Use Multi-Factor Authentication
- Keep Personal Contact Information Current
- Close or Delete Unused Accounts
- Be Wary of Free WiFi
- Beware of Phishing Attacks
- Use Antivirus Software and Keep Apps Current
- Know How To Report Identity Theft and Cybersecurity Incidents
Fiduciary Responsibilities—and Protection
Remember, that any individual involved in the management of a retirement plan of any size can face personal exposure for breach of fiduciary responsibilities. Given expanding responsibilities and the increased risk of lawsuits, plan sponsors across the country are turning to Colonial Surety for affordable protection.
Don’t go it alone. At Colonial, as a plan sponsor, you can affordably obtain fiduciary liability insurance along with your required ERISA bond. Fiduciary liability coverage gives you peace of mind that your personal assets are protected from a breach of responsibility in the administration or handling of an employee benefit plan, such as a retirement plan. Colonial’s annual premium is less that what you would pay for one hour with an expert ERISA lawyer: Secure Fiduciary Liability Insurance Now.
Cybersecurity Support Especially for Small Businesses
The government’s new guidance puts increased importance on protecting retirement plan data and funds in the cyber era. Confronting the rise in cyber threats, small businesses are generally without access to the services and protections that larger companies are able to put in place. Not having a response plan has resulted in disaster.
Realistically, implementing all the new governmental guidance for plan sponsors will take some time. Start mitigating your risks with Colonial Surety today. When you select a comprehensive package, you realize the greatest savings—and protection for your business, your plan, and yourself.
Colonial’s comprehensive package includes:
- The required ERISA bond which protects the assets of the retirement plan from theft;
- Fiduciary Liability coverage to protect you and your assets from personal liability; and,
- Cyber Liability coverage to safeguard your company and plan from covered losses and expenses in the event of a cyber breach.
Colonial Surety Company is rated “A Excellent” by A.M. Best Company, U.S. Treasury listed and in business all across the country. Serving customers since 1930, Colonial Surety is the trusted source for the pension industry to secure legally required ERISA bonds, fiduciary liability insurance and cyber-liability insurance. We help safeguard plan sponsors– and keep their businesses compliant – with pain-free, efficient, and friendly service every time.