Client Service November 16, 2023

Ascensus, Newport Nonqualified Platforms Hit by Infosys Cybersecurity Issue

Ascensus and its Newport-owned nonqualified retirement systems have not been able to update participant accounts since November 2.

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Ascensus and its subsidiary, Newport Group Inc., have had their nonqualified retirement plan services affected by a cyberattack on business processes firm Infosys McCamish Systems LLC.

The platform that Ascensus and Newport use has not been able to update nonqualified user accounts since November 2. The firms are seeking a solution by November 17, according to a company spokesperson and a customer service letter sent to an account holder. 

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“The platform we use to support aspects of our nonqualified retirement plan administration services has been affected by the Infosys McCamish outage since November 2,” a spokesperson said via email. “We have been communicating regularly with our clients and participants since that time, and our systems are not impacted. Account values will be accurately reflected once full functionality has been completely restored. We have apologized for any inconvenience or concern this has caused.”

Infosys BPM Ltd., based in Bangalore, India, released a statement November 3 that its U.S. subsidiary, Infosys McCamish, had been made aware of a “cybersecurity event resulting in non-availability of certain applications and systems in IMS.” The firm noted it is working with a “leading cybersecurity products provider” to resolve the issue.

Infosys McCamish provides platform-based services to more than 40 insurance companies “across a broad array of insurance products, distribution models and platform deployment options,” according to its website. It lists retirement industry services that include nonqualified support, qualified defined contribution administration and qualified defined benefit administration. On Thursday, a spokesperson said Infosys BPM had no further information beyond the November 3 statement.

Ascensus, which acquired Newport in 2021, is listed as the second-largest NQDC provider by participants with 135,217 account holders, according to PLANSPONSOR’s 2023 NQDC market survey. 

Ascensus started investigating the issue on November 2, according to the spokesperson.

A Newport letter to at least one account holder shared with PLANADVISER stated that had no evidence that plan data had been “exfiltrated or disclosed to the public.” The account holder requested their name not be used. 

“We do not expect the technical issues to be resolved before November 17 and will continue to update your Dashboard’s Messages with further updates,” Newport wrote in the customer service letter.

Newport is logging all retirement plan transactions submitted after market close on November 1 to be processed once the system is restored, according to the letter. Plan participants were told they can submit transactions as normal.

“Once the technical issues have been resolved, we will carefully review, update, and verify all transactions that have taken place during this period,” the letter said. “Once complete, you can rest assured that account values will be accurately reflected, and we look forward to resuming normal servicing of your plan.”

Practice Management November 15, 2023

100% of Large Retirement Plan Advisories Now Include Wealth Strategy, According to T. Rowe

In 2019, only half of plan advisers were considering a wealth strategy, but the opportunity to enhance profits by offering more integrated solutions has led to a major shift.

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There’s no more holding out by large retirement plan advisory firms in offering a built-in wealth strategy for clients, according to researchers at T. Rowe Price.

In the Retirement Leadership Forum 2021 Aggregator Survey, all of advisers reported having a built-in wealth strategy to offer participants in the plan, said Michael Doshier, a senior defined contribution adviser strategist at T. Rowe Price, at a retirement market outlook press event Tuesday at the Nasdaq MarketSite in Times Square, New York.

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Doshier said that as recently as a few years ago, many advisers used to look down at chasing rollovers or servicing participants, since their primary incentive was servicing the retirement plan. However, over the last 10 years, retirement plan advisories have gone from acquiring each other and looking for scale to acquiring wealth practices and offering additional services.

“Why is that? … I think it’s the potential benefit for the end investor—integrated solutions all in one place—and profit-margin enhancement for the firms,” Doshier said. “Recently, you’ve started to see retail wealth firms buying retirement plan advisory firms. You hear about the competitive nature of the retirement planning business and the low-margin nature of it.”

One reason for the shift is that most brand enhancement activities catering to younger investors are probably happening via their 401(k) plan. Participants look at their balance a couple of times a year and see the brand name of the provider of that 401(k) or an advisory firm working with them, making them more likely to recognize that company for wealth management, Doshier noted.

“A wealth firm looking to buy a retirement firm might be looking for a low-cost new acquisition methodology for new potential clients,” he said. “As these accelerate, enhanced by the technology, data and AI innovations, [that will make] them more scalable and more efficient for the average advisory or consulting firm to actually change their tune and want to help those participants.”

Among plan advisers surveyed by in the Retirement Leadership Forum 2021 Aggregator Survey, 75% strongly agreed that building wealth relationships with retirement plan participants was a significant opportunity for their practice. Meanwhile 19% agreed with the statement and 6% were neutral. Wealth management is viewed as a part of the firm’s value proposition for the market, both for plan sponsors and their participants. Doshier said this was especially common during the pandemic.

“The first firms that looked like they kind of resurfaced and came out of the quiet period of the early part of the pandemic were the ones that had stepped away from a narrow definition of what they do in retirement or wealth,” he said. “That broadly put them together into a bigger picture of being able to help participants or investors achieve financial security and wellness.”

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