[10817]
March 19, 1999
TO: PENSION COMMITTEE No. 18-99
RE: DOL AMENDS CLASS EXEMPTIONS TO INCLUDE EDUCATION IRAS AND
SIMPLE ACCOUNTS
______________________________________________________________________________
The Department of Labor’s Pension and Welfare Benefits Administration recently amended two
prohibited transaction exemptions to permit free or low-cost brokerage or banking services to also apply
to Education IRAs and SIMPLE accounts. Prohibited Transaction Exemption (“PTE”) 97-11 allows
brokerage firms to provide IRA and Keogh customers low or no-cost services, which otherwise would
be prohibited under ERISA. PTE 93-33 provides similar relief to the banking industry. As a result of
the amendments, effective January 1, 1998, broker-dealers and banks may provide customers with
additional services as incentives for maintaining Education IRAs and SIMPLE accounts.
Copies of the amendments are attached.
Kathryn A. Ricard
Assistant Counsel
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