Trust Updates Archive

In response to subscriber requests, an index of the current issue of TRN will be e-mailed shortly after the newsletter has been mailed. (The February issue was mailed on Wednesday, Feb. 18.) Also, in response to subscriber requests, TRN will be published earlier each month. Subscriber feedback is always encouraged as part of our ongoing efforts to provide you with the best source of fiduciary risk management news.


TRN Index--February 2004.

CONVERSIONS--Plaintiffs Focus on Missing Minutes in LaSalle's Conversion.
Coverage of the recent amended complaint field in Hughes v. LaSalle, a common trust fund to proprietary mutual fund conversion

CONVERSIONS--Roadmap for Converting.
If a trustee is going to use proprietary, rather than third-party mutual funds, Yale Law professor John Langbein stresses the need for clear documentation and "honest disclosure" in his report for plaintiffs in Hughes v. LaSalle.

CONFLICTS OF INTEREST--Opting for Third-Party Investments, Institution Says Own Rates Not Competitive.
Even when interest rates are lower than competitors', fiduciaries have justified the use of own-bank investment vehicles for short-term cash because of indirect benefits, such as convenience and flexibility. Nevertheless, some banks are opting to move money to competitors.

ERISA--Settlements in Litigation: Potential Prohibited Transaction.
To the surprise of many attorneys and fiduciaries, the U.S. Department of Labor in 2003 proposed a class exemption asserting that a settlement involving a plan and parties in interest could be construed as a prohibited transaction.

ESOPs--IRS Shuts Down S Corporation Abuse.
The IRS is cracking down on preferential tax treatment of corporation earnings sheltered through an employee stock ownership plan.

TAX SHELTERS--IRS Has Funds to Expand War on Tax Shelters; Banks Next?
The IRS is aggressively seeking to halt the promotion of abusive tax shelters. Having successfully won its recent offensive against leading accounting firms, sources say it is now focusing on the actions of related parties, such as banks.

OCC--Preemption Hearing: Mixed Message for OCC.
The OCC received both praise and reprimand from House members during the first hearing on its recently issued preemption rule.