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Release Date: 10/16/2002
Release Number: 02-22
Contact Name: Gloria Della
Phone Number: 202.693.8664
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Washington, DC - The U.S. Department of Labor’s
Pension and Welfare Benefits Administration today issued a technical amendment
to an existing class exemption that allows employee benefit plan fiduciaries to
use certain affiliated broker-dealers to execute securities transactions for
plans. |
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The revised exemption is designed to address the
consolidation in the financial services industry that has resulted in more
trustees having an affiliation with broker-dealers. The amendment puts
trustees on a level playing field with investment managers. |
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The exemption amends Prohibited Transaction Exemption (PTE)
86-128, which allows plan fiduciaries to receive a fee for executing securities
transactions for plans. Prior to the amendment, PTE 86-128 generally did
not allow the receipt of a fee by a plan trustee having discretionary authority
over plan assets. The amendment was requested in an exemption application
filed by the Securities Industry Association. |
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The amendment now permits such trustees of plans with at
least $50 million in assets to receive a fee for the execution of securities
transactions for plans. One protection afforded by the amendment is the
provision of certain relevant information by the trustee to a plan fiduciary
that is independent of the discretionary trustee. |
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The amendment is effective upon publication in the Federal
Register. The amended exemption is scheduled for publication in the October
17, 2002 Federal Register. |
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U.S. Department of Labor
news releases are accessible on the Internet. The information in this news
release will be made available in alternate format upon request (large
print, Braille, audio tape or disc) from the Central Office for Assistive
Services and Technology. Please specify which news release when placing
your request. Call 202.693.7773 or TTY 202.693.7755. |
