Neal Seeks Insight into Cryptocurrency and Retirement Saving
WASHINGTON, DC – In the wake of recent announcements from major defined contribution (DC) saving plans regarding new cryptocurrency investment options, Ways and Means Committee Chairman Richard E. Neal (D-MA) today requested that the U.S. Government Accountability Office (GAO) assess various aspects of this development. In his letter to GAO Comptroller General Gene Dodaro, the Chairman noted the importance of DC savings plans for Americans who are planning and managing their retirement, and asked the agency to provide additional information about the available cryptocurrency investment offerings and what oversight of those options exists.
“Recent announcements from major DC plan providers indicate that many employers who sponsor DC plans will have the option to allow their employees to invest in cryptocurrencies,” wrote Chairman Neal. “However, concerns have arisen about the risks to older Americans’ retirement security of using retirement accounts to invest in cryptocurrencies due to their volatility and limited oversight. In 2022, the Department of Labor cautioned that DC plan sponsors should exercise extreme care before they consider adding a cryptocurrency investment option to their plan, given the risks and complications these assets pose to both participants and sponsors.”
Specifically, the Chairman asked GAO to:
- Determine the extent to which investment options for cryptocurrency are being offered by firms with a listing of the types of firms, for instance by size, offering the options and the extent to which the investment options for cryptocurrency are being utilized by sponsors of 401(k) plans.
- Describe how DC plans administer cryptocurrency investment options, such as determining their valuation, the types and levels of fees associated with them, and safeguards, if any, that plan fiduciaries report using to maintain their fiduciary obligations to participants and beneficiaries.
- Assess the oversight of cryptocurrency investment options in 401(k) plans by the relevant agencies, and guidance federal agencies provide to plan sponsors, participants, and beneficiaries about investing in cryptocurrency and examine the current restrictions, if any, on investments in cryptocurrency in 401(k) plans.
Full text of the letter is available HERE.