February 4, 1994
TO: INVESTMENT ADVISERS COMMITTEE NO. 10-94
RE: PROPOSED DOL EXEMPTION PERMITTING CERTAIN AGENCY-CROSS
TRANSACTIONS
__________________________________________________________
At the Investment Advisers Committee meeting on February 1, there was a
discussion about an individual exemption that is under consideration by the
Department of Labor to permit an investment adviser to transact certain cross-
trading on behalf of employee benefit plan accounts. As we discussed, prior
authorization of each transaction would be required for managed accounts, but not
for index accounts. In addition, a cross-trade would be permitted to exceed a
volume limit of five percent of average daily trading volume only by express
authorization of an independent fiduciary. Finally, the proposed exemption would
cover transactions in both equity and debt securities.
At the request of several members at the meeting, a copy of the proposed
exemption is attached.
Amy B.R. Lancellotta
Associate Counsel
Attachment