(1) A fiduciary with respect to the State and Education Employees Group Insurance Board shall not cause the Board to engage in a transaction if the fiduciary knows or should knowthat such transaction constitutes a direct or indirect:
(a) sale or exchange, or leasing of any property from the Board to a party in interest for less than adequate consideration or from a party in interest to the Board for more than adequate consideration;
(b) lending of money or other extension of credit from the Board 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 Board with provision of excessive security or an unreasonably high rate of interest;
(c) furnishing of goods, services or facilities from the Board to a party in interest for less than adequate consideration, or from a party in interest to the Board for more than adequate consideration; or
(d) transfer to, or use by or for the benefit of, a party in interest of any assets of the Board for less than adequate consideration.
(2) A fiduciary with respect to the Board shall not:
(a) deal with the assets of the Board in the fiduciary's own interest or for the fiduciary's own account;
(b) in the fiduciary's individual or any other capacity act in any transaction involving the Board on behalf of a party whose interests are adverse to the interests of the Board or the interests of its participants or beneficiaries; or
(c) receive any consideration for the fiduciary's own personal account from any party dealing with the Board in connection with a transaction involving the assets of the Board.
(3) A fiduciary with respect to the Board may:
(a) invest all or part of the assets of the Board 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
(b) 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.
(4) A person or a financial institution is a fiduciary with respect to the Board to the extent that the person or the financial institution:
(a) exercises any discretionary authority or discretionary control respecting management of the Board or exercises any authority or control respecting management or disposition of the assets of the Board;
(b) renders investment advice for a fee or other compensation, direct or indirect, with respect to any monies or other property of the Board, or has any authority or responsibility to do so; or
(c) has any discretionary authority or discretionary responsibility in the administration of the Board.
Added by Laws 1989, c. 318, § 7, operative July 1, 1989.