The Markets August 20, 2009

New Jersey 529 Plan Lowers Fees, Adds Conservative Funds

New Jersey's Higher Education Student Assistance Authority reached an agreement to reduce administrative fees and offer more conservative investments for the NJBEST 529 college savings plan.

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The Star-Ledger in Newark reported that by December, the program’s annual management fee, which pays for the services of Franklin Templeton Investments, will be reduced by 50%, saving $800,000. In addition, the plan will offer two new age-based investment options: Conservative Age-Based Portfolios and Moderate Age-Based Portfolios, the authority said.

The existing age-based portfolios will be renamed Growth Age-Based Portfolios, according to the news report.

Franklin Templeton agreed to absorb nearly $200,000 in costs to implement the changes.

The plan has been criticized by Morningstar for charging high fees and for having age-based portfolios that are too risky for students close to attending college (see “Ohio 529 Plans: Both the Best and the Worse”).

Compliance August 20, 2009

QVC Ends 401(k) Loan Investigation

QVC officials have completed their investigation into alleged employee misconduct in taking 401(k) loans, but declined to say if they found any fraud or if any workers had been terminated, the Rocky Mount Telegram reported.

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“Out of continued respect for all of our employees, the specifics and results of the investigation and the individual meetings with employees will remain personal and confidential,” Tara Hunter, a spokeswoman for QVC said in a written statement, according to the news report.

The Telegram said some employees indicated QVC officials had yet to contact them about the status of their jobs.

More than 200 workers were turned away from the Edgecombe County plant on August 5 and given letters instructing them to schedule a meeting with a company loss prevention specialist and HR representative to prove their loans, already paid by Fidelity Investments, were legitimate (see “QVC Loan Probe Continues”). The company said employees returning to work would receive back pay.

Workers indicated they had been forced to tap into their retirement plans because the company has imposed a salary freeze, cut back on overtime and hours, and started paying employees biweekly, instead of weekly.

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