DOL Proposes PTE Extension for Plans After Terrorist Attacks
The proposal is intended to provide a cushion if participants shift large sums of money from stocks to more conservative investments. While that doesn’t appear to have happened yet in the wake of the September 11 attacks, such actions could potentially force the funds to sell stocks to cover the redemption requests.
The proposal, an amendment to PTE 80-26, is just one of several taken by government regulators to offer some relief to US financial markets in the wake of the September 11 terrorist attacks, would waive the lending ban from September 11 until January 9, 2002.
Prohibited Transaction Exemption
PTE 80-26 is a class exemption that permits parties in interest with respect to employee benefit plans to make interest free loans to such plans, provided the conditions of the exemption are met. If adopted, the proposed amendment would affect:
- all employee benefit plans
- the participants and beneficiaries of such plans, and
- parties in interest with respect to those plans engaging in the described transactions
Comments Requested
Written comments and requests for a public hearing should be received by the Department of Labor on or before November 13, 2001.
All written comments and requests for a public hearing (preferably three copies) should be addressed to the
- U.S. Department of Labor
- Office of Exemption Determinations
- Pension and Welfare Benefits Administration
- Room N-5649
- 200 Constitution Avenue, NW, Washington, DC 20210,
- (Attention: PTE 80-26 Amendment).
For additional information, contact Mr. Christopher J. Motta, Office of Exemption Determinations, Pension and Welfare Benefits Administration, U.S. Department of Labor, (202) 219-8881.
– Nevin Adams editors@plansponsor.com
The proposal in the Federal Register .
Other Pension Impacts After the Terrorist Attacks:
See Also SEC extension on buybacks .
See Also Pension Authorities Extend 5500 Deadlines
See Also Participants Finally Turn to Stocks, But Volume Remains High