Challenge to $2.1 Billion Pentegra 401(k) Plan Moves Forward

A proposed class action challenging the $2.1 billion retirement plan Pentegra Retirement Services Inc. administers for thousands of employees across nearly 250 financial institutions is moving forward after a Manhattan federal judge declined to dismiss the case’s core claims.

The plan’s fiduciaries must face claims that they acted imprudently under the Employee Retirement Income Security Act by allowing participants in the Pentegra Defined Contribution Plan to pay excessive administrative and investment management fees, Judge Philip M. Halpern of the U.S. District Court for the Southern District of New York said Wednesday.

Pentegra defended the plan’s recordkeeping fees, saying the lawsuit ...