[Federal Register Volume 87, Number 192 (Wednesday, October 5, 2022)]
[Notices]
[Pages 60417-60418]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-21578]


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DEPARTMENT OF LABOR

Employee Benefits Security Administration

[Exemption Application Nos. D-12042, D-12039, and D-12049]


Notice of Withdrawal of Proposed Exemptions

AGENCY: Employee Benefits Security Administration, Labor.

ACTION: Notice of withdrawal of proposed exemptions.

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SUMMARY: This document provides notice of the withdrawal of three 
proposed individual exemptions from certain prohibited transaction 
restrictions of the Employee Retirement Income Security Act (ERISA) and 
the Internal Revenue Code (the Code). The proposed exemptions were 
issued by the Department of Labor on August 24, 2022.

FOR FURTHER INFORMATION CONTACT: Joseph Brennan of the Department at 
(202) 693-8456. (This is not a toll-free number.)

Withdrawal of Proposed Exemption

    The Department published notices of proposed exemption from certain 
prohibited transaction provisions of ERISA and the Code in the Federal 
Register on August 24, 2022, for the following applicants: Triple-S 
Management Corporation, Blue Cross and Blue Shield of Kansas City, and 
the National Account Service Company LLC.\1\ As described more fully in 
the proposed exemptions, the applicants sponsor defined benefit plans 
that have (or had) filed legal action and claims against Allianz Global 
Investors U.S. LLC (Allianz) and Aon Investments USA Inc. (Aon) 
regarding certain investment losses the plans incurred during the first 
quarter of 2020.
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    \1\ Triple-S Management Corporation (87 FR 52168); Blue Cross 
and Blue Shield of Kansas City (87 FR 52124); National Account 
Service Company LLC (87 FR 52174).
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    The proposed exemptions would have permitted the applicants to make 
payments to their respective plans in order to offset the investment 
losses the plans incurred, and, if the plans received litigation 
proceeds from the claims, to transfer the lesser of the ligation 
proceeds amounts or the payments to the applicants. Without an 
exemption, the plans' receipt of payments from the applicants in 
exchange for the plans' transfer of litigation proceeds to the 
applicants would violate certain prohibited transaction provisions of 
ERISA and the Code. The applicants represented to the

[[Page 60418]]

Department that the plans have received litigation proceeds from the 
claims.
    After the publication of the proposed exemptions in the Federal 
Register, the applicants informed the Department that they have decided 
not to pursue the proposed exemptions due to changed circumstances and 
requested the Department to withdraw their exemptions. Therefore, the 
Department is withdrawing the proposed exemptions from the Federal 
Register as requested.\2\ As a result, the applicants may not receive 
repayments for any amounts they paid to their respective plans in 
connection with the plans' receipt of litigation proceeds from the 
claims, because such repayments would constitute a violation of certain 
prohibited transaction provisions of ERISA and the Code.
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    \2\ In withdrawing the proposed exemptions, the Department is 
not expressing an opinion regarding the merits of any claim against 
Allianz and Aon or whether the plans' fiduciaries met their 
fiduciary duties with respect to plan assets that are the subject of 
the claims. Further, in withdrawing the proposed exemptions, the 
Department is not limiting any party's claim, demand, and/or cause 
of action arising from the plans' 2020 first quarter losses in any 
way.

    Signed in Washington, DC.
George Christopher Cosby,
Director, Office of Exemption Determinations, Employee Benefits 
Security Administration, U.S. Department of Labor.
[FR Doc. 2022-21578 Filed 10-4-22; 8:45 am]
BILLING CODE 4510-29-P