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TIAA Rollover Complaint

Months after the Securities and Exchange Commission (SEC) and the New York attorney general alleged Teachers Insurance and Annuity Association of America (TIAA) and TIAA-CREF Individual and Institutional Services LLC advisers inappropriately pressured customers to transition their investments from their employer-sponsored retirement plans to expensive individually managed TIAA accounts, a similar compliant has been filed by the ERISA-focused law firm of Schlichter, Bogard and Denton. The prior claim, which was resolved via a $97 million settlement paid by TIAA, stated that the advisory programs that individuals were rolled into from employer-sponsored plans record kept by TIAA were significantly more expensive than the employer-sponsored plans, generating more fees for TIAA, yet without “commensurate performance benefits”. This new complaint extends those allegations, claiming TIAA misuse of confidential and personal financial data, targeting pre-retirees with large balances for TIAA advisors to employ sales tactics that “falsely portrayed TIAA’s high-cost non-plan products as preferred” solutions, disregarding participants’ best interests. Allegations include misrepresentation of objectivity on the part of the TIAA advisers, who did not disclose their commission compensation structure. As a result of TIAA practices, TIAA “reaped massive and unlawful profits” at the expense of participants in the TIAA record kept retirement plans.

www.planadviser.com; October 13, 2021.