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  • Writer's pictureSamantha Diggs

What Does it Mean to be a CEFEX-certified TPA?

Updated: Mar 10, 2022

Financial Advisors, Investment Providers and Third Party Administrators (TPAs) are always looking for ways to stand out among their competitors and to prove that they are reputable and trustworthy. One way to demonstrate this is to earn the Seal of Excellence from the Centre for Fiduciary Excellence (CEFEX).

You may have heard service providers tout the Seal of Excellence among their credentials, but what exactly does that mean to you? We are going to define the CEFEX Seal of Excellence, examine what it means for a TPA to be CEFEX-certified, and outline the benefits to both Financial Advisors and Plan Sponsors when they choose to partner with a CEFEX-certified TPA.

The Centre for Fiduciary Excellence is an independent certification organization which defines a set of best practices for retirement service providers, based on the ASPPA Standard of Practice for Retirement. The best service providers in the country voluntarily undergo stringent, annual CEFEX assessments which verify that they adhere to the established practices.

The CEFEX assessments are continuously updated to remain current with the ever-changing investment environment. In an industry that experiences so many changes, CEFEX continues to provide a consistent standards of quality control that clients and business partners can trust.

So, what does it mean when a TPA is CEFEX-certified? As CEFEX explains, it means they adhere to a defined standard of practice that addresses four categories of operations.

The first category – Organize – addresses management structure, internal systems and procedures, HR policies & practices, and IT.

Secondly, Formalize evaluates business strategies, allocation of resources, disclosure of fees and sales & marketing practices.

The Implement category entails a review of information management systems, administration capabilities, compliance practices and all procedures to ensure plan continuity.

Lastly, Monitor evaluates the TPA’s internal processes for self-review and the effectiveness of those processes.

This assessment is voluntary, which means that a CEFEX-certified TPA is going the extra mile to hold themselves accountable to the highest industry standards and to establish themselves as a firm of credibility and integrity. RPCSI understands the importance of operating at the highest standard and our dedication to excellence means we continuously strive for improvement in every aspect of our business. Undergoing annual CEFEX assessments is proof of that dedication. So, what does this mean for our business partners?

In short, you can trust that you will be receiving industry-leading care. With only 54 CEFEX-certified TPAs in the nation – and only two in Indiana – this level of service is truly rare. The benefits of working with a certified TPA are plentiful for both Financial Advisors and Plan Sponsors.

For Financial Advisors, this certification means you can have confidence that your TPA is reliable and knowledgeable. Advisors work hard to establish themselves as credible and trustworthy and they want business partners who align with their service expectations. A CEFEX-certification is proof of a TPA’s commitment to providing excellent service for all clients and advisors. In a complex industry that is ever-changing, Plan Sponsors look to their advisors for guidance and expertise beyond investments. Working with a certified TPA provides advisors with the priceless resource of a highly-educated and experienced team of ERISA professionals. This equips the advisor to offer their clients a more comprehensive service without sacrificing the quality of service.

For Plan Sponsors, the CEFEX certification demonstrates that the TPA you are choosing is an expert in providing administrative services for your plan. As a Plan Sponsor, you are a retirement plan fiduciary –meaning that it is your responsibility to oversee the company’s retirement plan and to act solely in the interest of the plan participants with the purpose of providing benefits to them. Acting in the best interest of plan participants means choosing the most qualified servicing providers and ensuring they maintain those standards of service. A CEFEX-certified TPA must document their processes, provide fee transparency and adhere to the highest industry standards, as measured by the rigorous annual assessments performed by CEFEX.

Beyond that, certified TPAs provide support for DOL and IRS audits, protect your plan’s personal and identifiable information, and ensure accuracy and compliance for your plan. With these practices, and more, in place, Plan Sponsors can rest assured that a partnership with a CEFEX-certified TPA will alleviate the fiduciary stresses, reduce liabilities and assist the Plan Sponsor with fulfilling their due diligence obligations.

While we have covered many of the benefits of working with a CEFEX-certified TPA, this list is not all-inclusive. The benefits are as varied and unique as each retirement plan. What is consistent, however, is that you will receive service at an unmatched quality when you choose a CEFEX-certified TPA. Because we know that service is always what makes or breaks a relationship, we are committed to being the best service provider possible, and undergoing the annual audit from CEFEX is proof of that commitment. We would love to tell you more about the CEFEX difference, or to answer any questions you may have. Give us a call and let us know how we can help you.

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