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Njscpa 2011 fiduciary responsibilities and risk

  1. Fiduciary Responsibilities & Risk New Jersey Society of CPAs Audit of Employee Benefits Conference May 26, 2011 Mark D. Mensack, AIFA® Piedmont Independent Fiduciaries Joanne Szupka, CPA Roland J. O’Brien, CPA Robert A. Lavenberg, CPA, JD, LL.M BDO USA, LLP
  2. AGENDA • Fiduciary Risks & Responsibilities • Challenges to fulfilling fiduciary obligations • Techniques to overcome these challenges American Institute of CPAs 2
  3. Who is a Fiduciary? • “A fiduciary is someone who has undertaken to act for and on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence.” Bristol & West Building Society v Mathew • A fiduciary is anyone “exercising any discretionary authority or control regarding the management or disposition of plan assets…” ERISA §3(21)(A) American Institute of CPAs 3
  4. Two General Types of Fiduciaries Named Fiduciary - Someone specifically named in the plan document, or appointed by the plan sponsor. Functional Fiduciary – Someone who acts in a fiduciary capacity based on their job duties or responsibilities with respect to a plan. Individuals serving on investment committees, selecting service providers to a plan, and/or having influence or any discretionary authority over a plan are typically considered to be Functional Fiduciaries. American Institute of CPAs 4
  5. Are you a Functional Fiduciary? • Do you exercise authority, control, or influence in managing the plan? ▫ Who chose the salesperson? ▫ Who chose the product or service provider? ▫ Who chose the investment options in the plan? ▫ Who selects, monitors, or replaces investment options? ▫ Do you ever tell a participant how to invest their 401k? ▫ Do you ever approve a broker’s recommendations? American Institute of CPAs 5
  6. A Fiduciary • Fiduciary status is determined either: intentionally by being specifically named or appointed; or unintentionally by the functions one performs • Functions whereby one exercises authority, control or influence over the plan are fiduciary functions: ▫ Hiring or firing service providers ▫ Selecting or changing investment options ▫ Making decisions, including approval of recommendations American Institute of CPAs 6
  7. The ORC/Infogroup Survey August 19-23, 2010 • 60% of U.S. investors mistakenly think that “insurance agents” have a fiduciary duty to their clients. • 66% of U.S. investors are incorrect in thinking that stockbrokers are held to a fiduciary duty. • 76% of investors are wrong in believing that “financial advisors” – a term used by brokerage firms to describe their salespeople - are held to a fiduciary duty. American Institute of CPAs 7
  8. Non-Fiduciary Service Providers • Record-keepers • Third-Party Administrators (TPA) • Auditors • CPA’s • Stock Brokers = “Financial Advisors/Consultants” • Insurance Agents American Institute of CPAs 8
  9. Fiduciary Service Providers • Trust Company • Registered Investment Advisors ▫ Necessarily assumes non-ERISA fiduciary status under the Investment Advisor’s Act of 1940 • Independent Fiduciaries who by contract assume: ▫ ERISA 3(21) Fiduciary Status ▫ ERISA 3(38) Fiduciary Status American Institute of CPAs 9
  10. Personal Liability • A fiduciary is personally liable for any losses the plan incurs by reason of its breach. A fiduciary who has breached its duty is liable to restore to the plan any profits the fiduciary made through its use of plan assets and for any other equitable or remedial relief deemed appropriate by the court, including removal of the fiduciary. ERISA § 409 • The DOL can also access a civil penalty against a fiduciary who breached its duty or any person who knowingly participated in a breach in the amount of 20% of the amount recovered in a settlement with the DOL or awarded in a civil suit. ERISA § 502(l) American Institute of CPAs 10
  11. Personal Liability LaRue vs. DeWolfe – February 20th, 2008 the Supreme Court decided that individual employees can sue their employer for breach of fiduciary responsibility. “The threat to employers from an explosion of suits is real…I think it's meaningful for employers because it will open up the flood gates with respect to litigation." Ken Raskin, White & Case Goldenberg vs. Indel Corporation (Rancocas, NJ) 1st Fiduciary Breach Lawsuit in Southern NJ American Institute of CPAs 11
  12. Newark Star-Ledger August 28th, 2010 American Institute of CPAs 12
  13. A Breach of Fiduciary Responsibility could result in: • Extinction-level event for your firm • Negative impact on the retirement security of your employees • Financial ruin for you and other firm leadership • Criminal penalties including imprisonment: ▫ ERISA Section 501 contains criminal fines of up to $5,000 with potential imprisonment of up to a year. ▫ Sarbanes-Oxley increased these to a maximum of $100,000 with potential imprisonment of 10 years. American Institute of CPAs 13
  14. Fiduciary Risk • Fiduciary responsibility carries personal liability. • There is no “corporate veil” for fiduciaries. • DOL Sanctions can be between 20%-50% of plan assets. • The 2008 LaRue decision permits individual participants to sue plan sponsors for fiduciary breaches. • The Plaintiff ’s Bar sees over $3 trillion in US 401k assets. • There are potential criminal penalties including imprisonment American Institute of CPAs 14
  15. What is Fiduciary Responsibility? • Act solely in the interest of plan participants and their beneficiaries and with the exclusive purpose of providing benefits to them; • Carry out your duties prudently; • Follow the plan documents (unless inconsistent with ERISA); • Diversify plan investments; and • Pay only reasonable plan expenses. • Fiduciary obligations are among the “highest known to the law.” Brussian v. RJR Nabisco, 5th Circuit Court, 2000 American Institute of CPAs 15
  16. ERISA Fiduciary Responsibility Overview • Duty of Prudence – A fiduciary shall discharge his duties with respect to a plan solely in the interest of the participants and beneficiaries : -with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims; ERISA § 404 (a)(i)(b) • Duty of Exclusive Purpose - “A fiduciary shall discharge his duties . . for the exclusive purpose of: (i) providing benefits to participants and their beneficiaries; and (ii) defraying reasonable expenses of administering the plan. . . .” ERISA §404(a)(1)(A) American Institute of CPAs 16
  17. ERISA Fiduciary Responsibility Overview • Duty to Diversify – A fiduciary must diversify investments so as to minimize the risk of large losses. Where participants make the investment decisions, at least three diversified investment option with materially different potential risk and reward characteristics must be available. ERISA § 404 (a)(1)(C) • Duty to follow plan documents unless contrary to ERISA - A fiduciary must discharge his/her “duties in accordance with the documents and instruments governing the plan insofar as such documents and instruments are consistent with the provisions of Titles I and IV of ERISA. ERISA §404(a)(1)(D) American Institute of CPAs 17
  18. ERISA Fiduciary Responsibility Overview • Duty to avoid Prohibited Transactions ERISA 406 (a)(1)(c) prohibits all transactions between a plan and a party in interest, and lists several specific transactions that constitute self-dealing or a conflict of interest. Existing ERISA 408(b)(2) provides exemptions to ERISA 406 (a)(1)(c) if three requirements are met: ▫ The service must be necessary for the establishment or operation of the plan. ▫ The service must be furnished under a contract that is reasonable. ▫ No more than reasonable compensation may be paid for the service. American Institute of CPAs 18
  19. Fees, Expenses & Compensation “assure that the compensation paid directly or indirectly by [a plan to a service provider] is reasonable, taking into account the services provided to the plan as well as any other fees or compensation received by [the service provider] in connection with the investment of plan assets. The responsible plan fiduciaries therefore must obtain sufficient information regarding any fees or other compensation that [the service provider] receives with respect to the plans investments ….to make an informed decision whether the [service providers] compensation for services is no more than reasonable.” DOL - Frost (97-15A) and Aetna (97-16A) American Institute of CPAs 19
  20. Fees, Expenses & Compensation The DOL has taken the position that fiduciaries have a duty to know and evaluate indirect payments. In performing that evaluation, fiduciaries need to consider whether the total amounts received, directly and indirectly, by their service providers are reasonable. Further, fiduciaries must evaluate whether the payments cause potential conflicts of interest and, if so, whether the plan and participants are protected from those conflicts…The failure to evaluate those issues is a fiduciary breach. Revenue Sharing: What Is It , Fred Reish American Institute of CPAs 20
  21. Participants’ & 401k Fees • There are over 72 million 401k participants in America invested in more than 483,000 plans which contain over $3 trillion in assets. • 71% Believed they paid no fees • 81% Believed it was very important/somewhat important in making investment decisions 401(k) Participants’ Awareness and Understanding of Fees, AARP, 2011 American Institute of CPAs 21
  22. Why does it matter to the participant? Participant Contributions Current 401k Assets Balance Needed to Retire Excess Fees 1% in excess fees over the average American’s working lifetime, reduces their nest egg at retirement by 28%. DOL, EBSA Website American Institute of CPAs 22
  23. Self-dealing, Conflicts of Interest or Other Improper Influence Affect Expenses • Plan Sponsor – “We aren’t changing our service provider; we’re with ABC Bank and we have our lending relationship there.” • Firm selling 401k products – We only provide our clients with 401k products that pay us for “shelf space.” • 401k Product Provider – We only include mutual fund options on our platform that pay us for “shelf space.” • TPA – I recommend XYZ 401ks; once we have $25 million with them they pay us an additional 10 bps override • Salesperson – I recommend investment options that pay me a higher 12b-1 fee. American Institute of CPAs 23
  24. Rule 408(b)(2) Interim Final Service Provider Disclosure Service providers receiving at least $1,000 must: • Disclose all direct and indirect compensation it, or its affiliates or subcontractors, receives. • Provide a description of the services to be provided. • Disclose whether they are providing any fiduciary services. • Final regulation is effective as of January, 2012 It also includes a class exemption from the prohibited transaction provisions for a fiduciary who enters into a contract without knowing that the service provider has failed to comply with its disclosure obligations. American Institute of CPAs 24
  25. Form 5500 Schedule C • Applies to “large plans.” (100+ eligible Participants) • Compensation above $5000 is reportable • Compensation Types ▫ Direct – Paid directly from the plan ▫ Indirect – “Revenue Sharing,” investment management fees, finder’s fees, float revenue, brokerage commissions, securities lending revenue, etc. See section on Moral Hazard/Fallacy of Disclosure American Institute of CPAs 25
  26. Challenges to Fulfilling Fiduciary Obligations • Fiduciary Expectation • Moral Hazard / Fallacy of Disclosure • Revenue Sharing American Institute of CPAs 26
  27. Fiduciary Expectation • Auditor says: There were no noteworthy issues found during our audit. • TPA says: You’ve passed your ADP & ACP testing • Broker says: You’ve got a fiduciary warranty! • Employees say: We have no complaints about our 401k • Plan Sponsor hears: I am fiduciarily squared-away! American Institute of CPAs 27
  28. Fiduciary Expectation Fiduciary Non-fiduciary TPA (service provider) Plan Sponsor Recordkeeper (service provider) Has all fiduciary CPA/Attorney (service responsibility and provider) all potential Consultant(s) (service liability. provider) Custodian (service provider) American Institute of CPAs 28
  29. Moral Hazard Many types of 401k sales people offer fiduciary education, advice or assistance, but then deny in writing fiduciary responsibility. For example: ABC Firm and ABC Firm Financial Advisors do not provide tax or legal advice, are not “fiduciaries” (under ERISA, the Internal Revenue Code or otherwise) with respect to the services or activities described herein, and this material was not intended or written to be used for the purpose of avoiding tax penalties that may be imposed on the taxpayer. Individuals are urged to consult their tax or legal advisor before establishing a retirement plan or to understand the tax, ERISA and related consequences of any investments made under such plan. American Institute of CPAs 29
  30. Moral Hazard Fiduciary Warranties • “This unprecedented program offers plan sponsors and fiduciaries greater confidence, security and peace of mind by providing specific assurance for their fund selection. We’re so confident, we promise to restore any losses to the plan and pay litigation costs related to the suitability of our investment process and Fund lineup for 401(k) plans.” • “We recognize that fund selection and monitoring is an important part of the due diligence process for plan fiduciaries, and we are confident that our investment selection and monitoring process meets the highest standards. We are willing to put our name behind the Funds selected from our investment lineup and promise that our Funds….” • “…we are committed to helping you meet the highest fiduciary standards in the investment selection and monitoring process and commit to restore losses and pay litigation costs in the event that legal action is broughtofagainst qualifying plans. Now that’s security for30 American Institute CPAs your
  31. Moral Hazard Fiduciary Warranties “…since past performance is not a guarantee of future results, we cannot warrant or guarantee either that any investment option will yield any specific return, or even that it will yield a positive return. Nor does our Fiduciary Standards Warranty extend to claims that any expenses paid directly or indirectly by the Plan are reasonable.” American Institute of CPAs 31
  32. Moral Hazard QUIZ • How many documents must a plan sponsor review in order to read all of the available information before adopting a group annuity 401(k) plan? (Lets assume there is just one mutual fund in the plan!) • a) 2 / 127 / 6 b) 7 / 542 /56 c) 34 / 827 / 99 American Institute of CPAs 32
  33. Moral Hazard Quiz Answer: B • Prospectus – 72 pgs ▫ 5 pgs reference ▫ 9 pgs reference fees, compensation or COIs fees, compensation or conflicts • Plan Level Documents – 58 pgs of interests ▫ 9 pgs reference • SAI– 285 pgs fees, compensation or COIs ▫ 17 pgs reference • Adm Service Agreement – 11 pgs fees, compensation or COIs ▫ 2 pgs reference • Annual Report – 44 pgs fees, compensation or COIs ▫ 6 pgs reference fees, compensation or COIs 7 Documents • Semi-Annual Report – 36 pgs 539 Pages ▫ 8 pgs reference fees, compensation or COIs • Group Annuity Contract – 33 pgs American Institute of CPAs 33
  34. Moral Hazard Found on one of 542 pages. Your plan assets spent on: • Payments for placement of funds on a Financial Intermediary’s list of mutual funds available for purchase by its customers or for including funds within a group that receives special marketing focus or are placed on a “preferred list”; • “Due diligence” payments for a Financial Intermediary’s examination of the funds and payments for providing extra employee training and information relating to the funds; • “Marketing support fees” for providing assistance in promoting the sale of fund shares; • Sponsorships of sales contests and promotions where participants receive prizes such as travel awards, merchandise, cash or recognition; etc. SAI Page 180 of 285 American Institute of CPAs 34
  35. Revenue Sharing I • Revenue Sharing generally refers to a compensation practice in which money is paid to plan service providers out of the 401(k) investments, or by their managers (and affiliates.) It can be straightforward, hard to find, or hidden. Here are just two types, the first of which is straightforward, and the second of which is sometimes harder to find: ▫ 12(b)(1) fees - Ongoing “trail” commission paid to sales company for distribution and service. Typically range between 0.25% - 1% and deducted from fund assets. ▫ Sub-TA fees (Sub-Transfer Agency) – Asset-based fee and/or a per head fee and deducted from plan/fund assets. Intended to pay for administration performed by an intermediary; e.g. record keeper or TPA. American Institute of CPAs 35
  36. Revenue Sharing I Retail vs. Wholesale A R-1 R-2 R-3 R-4 R-5 R-6 Management fees 0.43% 0.43% 0.43% 0.43% 0.43% 0.43% 0.43% Distribution and/or service 0.24 1.00 0.75 0.50 0.25 none none (12b-1) fees Other expenses 0.18 0.21 0.48 0.22 0.18 0.13 0.09 (Sub-TA Fees) Total annual fund operating 0.85 1.64 1.66 1.15 0.86 0.56 0.52 expenses Integrity has no need of rules. Albert Camus American Institute of CPAs 36
  37. Revenue Sharing I $11,141.18 $3,941.08 American Institute of CPAs 37
  38. Revenue Sharing I • $7,726.30 Hard Dollar • $11,141.38 12(b)(1) fees • $3,941.08 Sub-TA fees • $22,808.76 Total (67.7% higher ) • $15,082.46 Unknown to Plan Sponsor “…several billion dollars of revenue-sharing fees are being hidden annually from plan sponsors and plan participants…” Jay Sanders, The CPA Journal, NYSSCPA, 2005 American Institute of CPAs 38
  39. Revenue Sharing II Group Annuity Separate Accounts • Group annuity contracts are often more complex than plan sponsors realize, riddled with hidden charges and lock-up periods… Marketing materials touted low-cost to employers, but left out all of the charges their workers would be subjected to. Forbes, Retirement Plans From Hell • “Insurance-company charges sometimes range as high as two to four percentage points annually. Added to management fees of the underlying investments, typically mutual funds, "You can be looking at annual charges of 3% to 5.5%...” Matthew D. Hutcheson American Institute of CPAs 39
  40. Why would anyone knowingly pay 3% to 5% in 401k fees? I cost 1.3% American Institute of CPAs 40
  41. They wouldn’t! I cost 1.3% I cost 1.21% I cost 0.37% I cost 0.25% Expense I cost Ratio 1.51% IM & A Charge Annual Charges & Fees Contract Asset Charge Transaction Costs "Pay no attention toInstitute of CPAs the man behind the curtain" Wizard of Oz American 41
  42. Revenue Sharing II Group Annuity Separate Accounts 1.30% Total Expense Ratio 1.21% Investment Management & Admin Charge 0.37% Annual Charges & Fees 0.25% Contract Asset Charge 1.51% Transaction Costs 4.64% Actual Cost Honesty pays, but it doesn't seem to pay enough to suit some people. Frank McKinney "Kin" Hubbard American Institute of CPAs 42
  43. A Note of “Transaction Costs” • Broker-dealer costs for securities transactions within a mutual fund are not reportable under the new fee disclosure rule; however: • In order to be Rule 404(c) compliant: The participants or beneficiary is provided…the following information, which shall be based on the latest information available to the plan: (i) A description of the annual operating expenses of each designated investment alternative (e.g., investment management fees, administrative fees, transaction costs) which reduce the rate of return to participants and beneficiaries… ERISA 404c-1 (2) American Institute of CPAs 43
  44. Revenue Sharing II Group Annuity Separate Accounts Expense Ratio of underlying fund* 0.26 Administrative Maintenance Charge 0.50 Sales & Service Fee 0.25 = Expense Ratio of Separate Account 1.01 Base Charge 0.60 Participant Fee 1.00 Total Cost 2.61% *Vanguard Value Index Fund, Investor Share Info provided by: David Wade, 401k Direct. Uncovering Hidden Fees in Insurance Company 401ks American Institute of CPAs 44
  45. Revenue Sharing II Group Annuity Separate Accounts Since* Expense 1 mo. 3 mos. YTD 1 yr. 3 yrs. 5 yrs. 10 yrs. Inception Ratio Vanguard Target -0.54 10.59 7.58 9.53 -3.67 N/A N/A 1.90 0.94 Retirement 2030 Ret Opt Performance shown is average annual total separate account investment choice returns (except 1 month, last quarter, and year-to-date) for the period indicated, net of the total operating expenses of the separate account or underlying investment as listed on the individual investment fact sheets. Performance returns reflect reinvestment of dividends and capital gains distributions. Application of the contract asset charge and any discontinuance charges or service fees deducted from the account would reduce this return. Group Annuity 401k Participant Website American Institute of CPAs 45
  46. Techniques to Overcome These Challenges • Prudent Process • Prudent Expert • Delegation – Fiduciary Line of Defense • Finding Fiduciaries • Benchmarking • Total Retirement Outsourcing American Institute of CPAs 46
  47. Prudent Process Investment Policy Statement • First step in Prudent Process • Most Fundamental Fiduciary Function • Supports the “paper trail.” • Keeps investment process intact during market volatility. • Provides working framework for fiduciaries • Sets guidelines for making investment decisions. • Negates “Monday morning quarterbacking.” American Institute of CPAs 47
  48. Prudent Process - Monitoring 48
  49. Prudent Expert • “Unless they possess the necessary expertise to evaluate such factors, fiduciaries would need to obtain the advice of a qualified, independent expert.” DOL Reg. § 2509.95-1(c)(6) • “…where the trustees lack the requisite knowledge, experience and expertise to make the necessary decisions with respect to investments, their fiduciary obligations require them to hire independent professional advisors.” Liss v. Smith, 991 F.Supp. 278, 297 (S.D.N.Y. 1998) American Institute of CPAs 49
  50. Prudent Expert ERISA 3(21)(A)(ii) Recordkeeper Plan (service provider) Sponsor CPA/Attorney (service provider) TPA Fiduciary (service provider) Advisor ERISA 3(21)(a)(ii) Custodian (service provider) American Institute of CPAs 50
  51. Fiduciary Delegation • ERISA section 402(c) allows for a plan sponsor to delegate fiduciary responsibility. A prudently selected and appointed fiduciary can alleviate a plan sponsor from nearly all fiduciary liability. The one residual fiduciary responsibility is to monitor the performance of the appointed fiduciaries. ▫ An Investment Manager under ERISA 3(38) ▫ An Independent Fiduciary under ERISA 3(21) American Institute of CPAs 51
  52. Fiduciary Delegation ERISA 3(38) Plan Sponsor Fiduciary Line Non-Fiduciary of Defense Service Providers Plan Recordkeeper (service provider) Sponsor CPA/Attorney (service provider) Formal TPA Appointment (service provider) ERISA 3(38) Investment Fiduciary Custodian (service provider) American Institute of CPAs 52
  53. Fiduciary Delegation ERISA 3(21) Full Scope Plan Sponsor Fiduciary Line Non-Fiduciary of Defense Service Providers ERISA 3(21) Recordkeeper (service provider) Plan Sponsor Full Scope Fiduciary CPA/Attorney (service provider) Formal Appointment TPA (service provider) Formal Appointment ERISA 3(38) Custodian Investment (service provider) Manager American Institute of CPAs 53
  54. Fiduciary Resources American Institute of CPAs 54
  55. SUMMARY • Confirm in writing fiduciary & non-fiduciary service providers • Maintain a “Prudent Process” • Discover & evaluate all fees & compensation • Retain a Prudent Expert • Delegate to an Independent ERISA 3(38) or 3(21) Fiduciary • Monitor & Document • Beware “Our plan is free” • Beware “fiduciary warranties” • Beware “fiduciary assistance” without contractual assumption of responsibility American Institute of CPAs 55
  56. Mark D. Mensack, AIFA® • Mark is a Managing Director and the Chief Ethics Officer of Piedmont Independent Fiduciaries, a Fee-only SEC Registered Investment Advisory firm. With more than 15 years experience in financial services and a background in ethical philosophy, Mark focuses on the ethical imperative of fiduciary Piedmont Independent Fiduciaries responsibility to educate plan Managing Director, sponsors and other fiduciaries on their fiduciary duties. As an Chief Ethics Officer independent fiduciary, Mark assumes ERISA 3(21)(a)(ii) and/or ERISA T: 856 528 9524 3(38) status in order to protect and E: enhance the retirement income security of retirement plan participants. American Institute of CPAs 56
  57. Joanne Szupka, CPA • Joanne Szupka has over 13 years of accounting experience with regional and national public accounting firms in areas of employee benefit plans. She has been responsible for all areas related to audits and reviews of single employer, multiemployer BDO USA, LLP and multiple-employer sponsored Assurance Manager, plans, including defined Employee Benefit Plan Specialist benefit, defined contribution and T: (215) 636 – 5591 health and welfare benefit plans. E: American Institute of CPAs 57
  58. Roland J. O’Brien, CPA • Roland O’Brien has over 25 years of accounting experience with local, regional and national public accounting firms. He has been responsible for all areas related to the audits and reviews of single employer, multiemployer and multiple-employer sponsored plans, including employee benefits, qualified BDO USA, LLP retirement, health and welfare and Director, fringe benefits plans. Roland has Employee Benefit Plan Practice been responsible for creating and presenting technical training programs, as well as providing T: (215) 636-5778 quality assurance services related to E: employee benefit plans. American Institute of CPAs 58
  59. Robert Lavenberg, CPA, JD, LL.M Bob Lavenberg has more than 25 years of experience with the Employee Retirement Income Security Act of 1974 (ERISA) and related business advisory services. His expertise spans reporting, government compliance BDO USA, LLP and assessment of tax implications for plans, including employee National Partner in Charge of Employee Benefit benefits, qualified Plan Audit Quality, Chair of AICPA’s 403(b) Plan retirement, health, welfare, and Audit Task Force fringe benefits. Bob currently serves as the Chair of the AICPA Employee Benefit Plan Audit T: (212) 885-8313 Quality Center Executive Committee and is a former E: member of the AICPA Employee Benefit Plan Audit Expert Panel. 59

Editor's Notes

  1. Slides 8-10 in response to “I’m not a fiduciary”
  2. Slides 11-14 in response to “our broker handles all that stuff.”
  3. Slides 15-18 in response to “What do you mean, personal liability?”I’ll talk through Sanctions and they are summarized on slide 14
  4. With Bob’s entry begin overall presentation
  5. Slides 15-18 in response to “What do you mean, personal liability?”I’ll talk through Sanctions and they are summarized on slide 14