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News Release
Labor Department Announces Advisory Opinion On Overdraft Protection For Plans
Archived News Release — Caution: Information may be out of date.
Washington, DC - The U.S. Department of Labor's Employee Benefits Security Administration (EBSA) released an advisory opinion on February 12, 2003, providing employee benefit plans the flexibility to use overdraft protection in processing securities transactions. The advisory opinion states that an employee benefit plan may complete transactions in a timely manner with the security of overdraft protection services provided by their bank.
Advisory Opinion Letter 2003-02A provides that such services are permissible under certain statutory exemptions of the Employee Retirement Income Security Act (ERISA) regarding general services and bank ancillary services. In the absence of an exemption, overdraft protection services would violate ERISA’s prohibited transaction rules.
The advisory opinion will be available on EBSA’s Web site at www.dol.gov/ebsa.
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Archived News Release — Caution: Information may be out of date.