The SEC has sent a questionnaire to a number of mutual fund companies, including Putnam and T. Rowe Price, asking about what kind of revenue-sharing arrangements they have with 401(k) administrators, Dow Jones reports. The Commission is looking at all types of arrangements, be they reimbursements, rebates, subsidies or other payments. The concern is that funds are paying for preferential positioning in defined contribution plans and that the arrangements are inflating fees borne by investors through 12b-1 fees or such hidden costs as sub-transfer agent or distribution costs.

The Department of Labor has also been investigating these arrangements over the past few months, looking to see if sponsors are violating ERISA laws requiring 401(k) plans to charge "reasonable" fees. DOL was prompted to look more closely at fees by the mutual fund scandal of the past 10 months, Sherwin Kaplan, a former DOL deputy associate solicitor, told Dow Jones.

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