Fiduciary

When a LOSAP sponsor engages Firefly as the third-party administrator and actuary, it also is hiring a fiduciary. Our role is to ensure that the sponsor is getting the best advice and solutions for the operation of the program, and to always have the sponsor’s and the participant’s best interests first and foremost when providing those solutions and advice.

Fiduciary is a defined term in the section of the New York State General Municipal Law that authorizes LOSAP. Section 215(5) states:

5. “Fiduciary” means any person who exercises discretionary authority or control with respect to the administration of the program or the management or disposition of program assets or who renders investment advice for a fee to the program.

NYS GML Section 215(5)

At Firefly, we generally have discretionary authority and control with the respect to the administration of the program, subject to the requirements of the plan document or the engagement we have with our specific client. We typically start benefits at entitlement age and stop benefits at death. We update direct deposit and tax withholding elections. We calculate the benefit amounts payable at entitlement age, death and disability. There are certainly situations that require approval from the sponsor before we proceed with an administrative action, but generally speaking we have some aspect of authority and/or control over the administration of every program we work with.

Not only are we a fiduciary in theory based on the statute above, we are a fiduciary in practice in how we provide our services to our clients. We willingly take on this responsibility and commit to be accountable to the sponsor and the participating volunteers.

If you are not currently working with Firefly, consider asking your current third-party administrator if they are a fiduciary. If the answer is no, ask why. Then consider contacting us!