§ 85-388. Fiduciary's powers and duties.

NOTE:  This section is due to be repealed Jan. 1, 2015, by Laws 2013, c. 254, § 53.

A.  A fiduciary with respect to the State Insurance Fund shall not cause the State Insurance Fund to engage in a transaction if the fiduciary knows or should know that such transaction constitutes a direct or indirect:

1.  sale or exchange, or leasing of any property from the State Insurance Fund to a party in interest for less than adequate consideration or from a party in interest to the State Insurance Fund for more than adequate consideration;

2.  lending of money or other extension of credit from the State Insurance Fund to a party in interest without the receipt of adequate security and a reasonable rate of interest, or from a party in interest to the State Insurance Fund with provision of excessive security or an unreasonably high rate of interest;

3.  furnishing of goods, services or facilities from the State Insurance Fund to a party in interest for less than adequate consideration, or from a party in interest to the State Insurance Fund for more than adequate consideration; or

4.  transfer to, or use by or for the benefit of, a party in interest of any assets of the State Insurance Fund for less than adequate consideration.

B.  A fiduciary with respect to the State Insurance Fund shall not:

1.  deal with the assets of the State Insurance Fund in the fiduciary's own interest or for the fiduciary's own account;

2.  in the fiduciary's individual or any other capacity act in any transaction involving the State Insurance Fund on behalf of a party whose interests are adverse to the interests of the State Insurance Fund or the interests of its participants or beneficiaries; or

3.  receive any consideration for the fiduciary's own personal account from any party dealing with the State Insurance Fund in connection with a transaction involving the assets of the State Insurance Fund.

C.  A fiduciary with respect to the State Insurance Fund may:

1.  invest all or part of the assets of the State Insurance Fund in deposits which bear a reasonable interest rate in a bank or similar financial institution supervised by the United States or a state, if such bank or other institution is a fiduciary of such plan; or

2.  provide any ancillary service by a bank or similar financial institution supervised by the United States or a state, if such bank or other institution is a fiduciary of such plan.

D.  A person or a financial institution is a fiduciary with respect to the State Insurance Fund to the extent that the person or the financial institution:

1.  exercises any discretionary authority or discretionary control respecting management of the State Insurance Fund or exercises any authority or control respecting management or disposition of the assets of the State Insurance Fund;

2.  renders investment advice for a fee or other compensation, direct or indirect, with respect to any monies or other property of the State Insurance Fund, or has any authority or responsibility to do so; or

3.  has any discretionary authority or discretionary responsibility in the administration of the State Insurance Fund.

Added by Laws 1989, c. 291, § 9, eff. July 1, 1989.  Renumbered from § 138.2 of this title by Laws 2011, c. 318, § 88.