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A Notice of Adverse Interest is exactly the way it sounds ? a letter notifying the plan that there may arise a community interest in this accout (of which you are legal entitled to). Upon receipt of the letter, the plan will be ?frozen? and unable to be liquidated.
You arrive at work one day to find your audit manager fuming. She has just received notice that your firm's client, Green Mountain Bikes Company, has initiated litigation against your firm. This poses an adverse interest threat as the member's objectivity in relation to the client has been compromised.
A notice of adverse interest provides notice to a plan of a divorce or pending divorce. In many cases, this triggers a hold on the plan benefits until a QDRO is served on the plan.
Adverse interest means when someone has an interest, claim, or right that goes against someone else's interest. For example, in a court case, the plaintiff and defendant have adverse interests because they want different outcomes.
In real property, adverse interest means a person, who's not the owner of the land or house, owns an interest of the property. For example, neighbor A owns an easement, which gives A the right to pass B's land to access public road, on the land of owner B. In this case, A has an adverse interest on B's land.