November 30, 1993
TO: PENSION COMMITTEE NO. 40-93
RE: DEPARTMENT OF LABOR PROPOSES TO EXPAND SCOPE OF BANK
SERVICES CLASS EXEMPTION
__________________________________________________________
As we previously reported, Prohibited Transaction Class Exemption 93-33
currently permits the receipt of bank services at reduced or no cost by an
IRA, SEP or non-ERISA Keogh participant pursuant to an arrangement under which
the deposit balance of the IRA, SEP/IRA or Keogh is taken into account for
purposes of determining eligibility for such services. (See Institute
Memoranda to Pension Members Nos. 6-93 and 23-93, dated
January 12, 1993 and June 3, 1993, respectively.) The class exemption in its
current form, however, only permits such reduced or no-cost services programs
to take into account bank deposits, such as certificates of deposit.
Attached is a copy of a proposed amendment to the class exemption, which
would permit such programs to take into account investments in securities for
which market quotations are readily available, including mutual funds. Any
written comments concerning the proposed amendment must be submitted to the
Department of Labor by January 3, 1994.
Please contact the undersigned by December 13 if you have any comments
concerning this proposal.
Kathy D. Ireland
Associate Counsel - Pension
Attachment