68716 Federal Register / Vol. 79, No. 222 / Tuesday, November 18, 2014 / Notices 

5 In general terms, a QPAM is an independent 

fiduciary that is a bank, savings and loan 

association, insurance company, or investment 

adviser that meets certain equity or net worth 

requirements and other licensure requirements and 

that has acknowledged in a written management 

agreement that it is a fiduciary with respect to each 

plan that has retained the QPAM. 

(8) Each Credit Suisse Affiliated 

QPAM provides its certified Audit 

Report to the Department’s Office of 

Exemption Determinations (OED), Room 

N–5700, 200 Constitution Avenue NW., 

Washington DC 20210, no later than 30 

days following its completion, and each 

Credit Suisse Affiliated QPAM makes its 

Audit Report unconditionally available 

for examination by any duly authorized 

employee or representative of the 

Department, other relevant regulators, 

and any fiduciary of an ERISA-covered 

plan or IRA, the assets of which are 

managed by such Credit Suisse 

Affiliated QPAM; 

(j) The Credit Suisse Affiliated 

QPAMs comply with each condition of 

PTE 84–14, as amended, with the sole 

exception of the violation of Section I(g) 

that is attributable to the Conviction; 

(k) Effective from the date of 

publication of any granted exemption in 

the Federal Register, with respect to 

each ERISA-covered plan or IRA for 

which a Credit Suisse Affiliated QPAM 

provides asset management or other 

discretionary fiduciary services, each 

Credit Suisse Affiliated QPAM agrees: 

(1) To comply with ERISA and the 

Code, as applicable to the particular 

ERISA-covered plan or IRA, and refrain 

from engaging in prohibited 

transactions; (2) not to waive, limit, or 

qualify the liability of the Credit Suisse 

Affiliated QPAM for knowingly 

violating ERISA or the Code or engaging 

in prohibited transactions; (3) not to 

require the ERISA-covered plan or IRA 

(or sponsor of such ERISA-covered plan 

or beneficial owner of such IRA) to 

indemnify the Credit Suisse Affiliated 

QPAM for violating ERISA or engaging 

in prohibited transactions, except for 

violations or prohibited transactions 

caused by an error, misrepresentation, 

or misconduct of a plan fiduciary or 

other party hired by the plan fiduciary 

who is independent of Credit Suisse 

AG; (4) not to restrict the ability of such 

ERISA-covered plan or IRA to terminate 

or withdraw from its arrangement with 

the Credit Suisse Affiliated QPAM; and 

(5) not to impose any fees, penalties, or 

charges for such termination or 

withdrawal with the exception of 

reasonable fees, appropriately disclosed 

in advance, that are specifically 

designed to prevent generally 

recognized abusive investment practices 

or specifically designed to ensure 

equitable treatment of all investors in a 

pooled fund in the event such 

withdrawal or termination may have 

adverse consequences for all other 

investors, provided that such fees are 

applied consistently and in like manner 

to all such investors. Within six (6) 

months of the date of publication of a 

granted exemption in the Federal 

Register, each Credit Suisse Affiliated 

QPAM will provide a notice to such 

effect to each ERISA-covered plan or 

IRA for which a Credit Suisse Affiliated 

QPAM provides asset management or 

other discretionary fiduciary services; 

(l) If a final exemption is granted in 

the Federal Register, each Credit Suisse 

Affiliated QPAM will maintain records 

necessary to demonstrate that the 

conditions of this exemption have been 

met for six (6) years following the date 

of any transaction for which such Credit 

Suisse Affiliated QPAM relies upon the 

relief in the exemption; 

(m)(1) Each sponsor of an ERISAcovered plan and each beneficial owner 

of an IRA invested in an investment 

fund managed by a Credit Suisse 

Affiliated QPAM, or the sponsor of an 

investment fund in any case where a 

Credit Suisse Affiliated QPAM acts only 

as a sub-advisor to the investment fund; 

(2) each entity that may be a Credit 

Suisse Related QPAM; and (3) each 

ERISA-covered plan for which the New 

York Branch of Credit Suisse AG 

provides fiduciary securities lending 

services, receives a notice of the 

proposed exemption along with a 

separate summary describing the facts 

that led to the Conviction, which has 

been submitted to the Department, and 

a prominently displayed statement that 

the Conviction results in a failure to 

meet a condition in PTE 84–14; 

(n) A Credit Suisse Affiliated QPAM 

will not fail to meet the terms of this 

exemption solely because a Credit 

Suisse Related QPAM or a different 

Credit Suisse Affiliated QPAM fails to 

satisfy a condition for relief under this 

exemption. A Credit Suisse Related 

QPAM will not fail to meet the terms of 

this exemption solely because Credit 

Suisse AG, a Credit Suisse Affiliated 

QPAM, or a different Credit Suisse 

Related QPAM fails to satisfy a 

condition for relief under this 

exemption. 

Section II: Definitions 

(a) The term ‘‘Credit Suisse Affiliated 

QPAM’’ means a ‘‘qualified professional 

asset manager’’ (as defined in section 

VI(a) 5 of PTE 84–14) that relies on the 

relief provided by PTE 84–14 and with 

respect to which Credit Suisse AG is a 

current or future ‘‘affiliate’’ (as defined 

in section VI(d) of PTE 84–14). The term 

‘‘Credit Suisse Affiliated QPAM’’ 

excludes the parent entity, Credit Suisse 

AG. 

(b) The term ‘‘Credit Suisse Related 

QPAM’’ means any current or future 

‘‘qualified professional asset manager’’ 

(as defined in section VI(a) of PTE 84– 

14) that relies on the relief provided by 

PTE 84–14, and with respect to which 

Credit Suisse AG owns a direct or 

indirect five percent or more interest, 

but with respect to which Credit Suisse 

AG is not an ‘‘affiliate’’ (as defined in 

section VI(d) of PTE 84–14). 

(c) The term ‘‘Conviction’’ means the 

judgment of conviction against Credit 

Suisse AG for one count of conspiracy 

to violate section 7206(2) of the Internal 

Revenue Code in violation of Title 18, 

United States Code, Section 371, which 

is scheduled to be entered in the District 

Court for the Eastern District of Virginia 

in Case Number 1:14-cr-188–RBS. 

Signed at Washington, DC, this 12th day of 

November, 2014. 

Lyssa Hall, 

Director of Exemption Determinations, 

Employee Benefits Security Administration, 

U.S. Department of Labor. 

[FR Doc. 2014–27173 Filed 11–17–14; 8:45 am] 

BILLING CODE 4510–29–P 

DEPARTMENT OF LABOR 

Employee Benefits Security 

Administration 

[Prohibited Transaction Exemption 2014– 

11; Application No. D–11819] 

Notice of Exemption Involving Credit 

Suisse AG (Hereinafter, Either CSAG 

or the Applicant) Located in Zurich, 

Switzerland 

AGENCY: Employee Benefits Security 

Administration, U.S. Department of 

Labor. 

ACTION: Notice of Temporary 

Exemption. 

SUMMARY: This document contains a 

notice of temporary exemption from 

certain prohibited transaction 

restrictions of the Employee Retirement 

Income Security Act of 1974, as 

amended (ERISA or the Act), and the 

Internal Revenue Code of 1986, as 

amended (the Code). The exemption 

would affect the ability of certain 

entities with specified relationships to 

CSAG to continue to rely upon the relief 

provided by Prohibited Transaction 

Class Exemption 84–14 for a period of 

one year from the date of publication of 

this notice. 

DATES: Effective Date: This temporary 

exemption will be effective as of the 

date a judgment of conviction against 


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Federal Register / Vol. 79, No. 222 / Tuesday, November 18, 2014 / Notices 68717 

CSAG for one count of conspiracy to 

violate section 7206(2) of the Internal 

Revenue Code in violation of Title 18, 

United States Code, section 371 is 

entered in the District Court for the 

Eastern District of Virginia in Case 

Number 1:14–cr–188–RBS and will 

expire one year from the date of 

publication in the Federal Register. 

FOR FURTHER INFORMATION CONTACT: Erin 

S. Hesse, Office of Exemption 

Determinations, Employee Benefits 

Security Administration, U.S. 

Department of Labor, telephone (202) 

693–8546. (This is not a toll-free 

number.) 

SUPPLEMENTARY INFORMATION: On 

September 3, 2014, the Department of 

Labor (the Department) published a 

notice of proposed exemption in the 

Federal Register at 79 FR 52365, 

proposing that certain entities with 

specified relationships to CSAG could 

continue to rely upon the relief 

provided by Prohibited Transaction 

Class Exemption (PTE) 84–14 (49 FR 

9494 (March 13, 1984), as corrected at 

50 FR 41430 (October 10, 1985), as 

amended at 70 FR 49305 (August 23, 

2005), and as amended at 75 FR 38837 

(July 6, 2010)), notwithstanding a 

judgment of conviction against CSAG 

for one count of conspiracy to violate 

section 7206(2) of the Internal Revenue 

Code in violation of Title 18, United 

States Code, section 371, to be entered 

in the District Court for the Eastern 

District of Virginia in Case Number 

1:14–cr–188–RBS. The proposed 

exemption described a set of additional 

conditions, designed to protect ERISAcovered plans and IRAs, that the entities 

with specified relationships to CSAG 

must satisfy in order to rely upon the 

relief in PTE 84–14. The exemption was 

requested by CSAG pursuant to section 

408(a) of ERISA and section 4975(c)(2) 

of the Code, and in accordance with the 

procedures set forth in 29 CFR Part 

2570, Subpart B (76 FR 66637, 66644, 

October 27, 2011). Effective December 

31, 1978, section 102 of the 

Reorganization Plan No. 4 of 1978, 5 

U.S.C. App. 1 (1996), transferred the 

authority of the Secretary of the 

Treasury to issue administrative 

exemptions under section 4975(c)(2) of 

the Code to the Secretary of Labor. 

Written Comments 

The Department invited all interested 

persons to submit written comments 

and/or requests for a public hearing 

with respect to the notice of proposed 

exemption published in the Federal 

Register on September 3, 2014, at 79 FR 

52365 on or before October 10, 2014. 

During the comment period, the 

Department received no telephone 

inquiries and ten written comments on 

the proposed exemption. The 

commenters include eight members of 

the general public, members of the U.S. 

House of Representatives (the 

Representatives), and the Applicant. 

Other than the Applicant, the 

commenters generally opposed granting 

an exemption to CSAG because of its 

pending criminal conviction or raised 

issues outside the scope of the 

exemption. The comment from the 

Applicant requested certain changes to 

the operative language of the exemption 

and provided additional information in 

support of the requested changes. 

The Department also received four 

hearing requests during the comment 

period from individuals, including the 

Representatives. The Department has 

decided to hold a hearing, consistent 

with its authority under 29 CFR 

2570.47, in order to more fully explore 

the issues raised by the commenters. A 

separate notice of hearing will be 

published elsewhere in this issue of the 

Federal Register. 

A discussion of the comments, the 

Applicants’ responses, and the 

Applicant’s comment follows below. 

Any capitalized terms used herein that 

are not otherwise defined have the 

meanings ascribed to them in the 

Summary of Facts and Representations 

in the notice of proposed exemption 

published in the Federal Register on 

September 3, 2014 at 79 FR 52365. 

Public Comments and Applicant’s 

Response 

1. Rollins, Lang, Rose, Johnson, and 

Blixseth Letters 

The Rollins Letter expressed concern 

that grant of the proposed exemption 

would undermine the public interest in 

enforcing criminal sanctions for 

corporate misconduct and deterring 

future wrongdoing. The Lang letter 

asserted that fines alone were 

inadequate sanctions for the Applicant’s 

misconduct and, accordingly, that the 

Department should deny the exemption. 

The Rose letter suggested that grant of 

an exemption would warrant 

presidential impeachment. The Johnson 

letter commented that approval of the 

exemption would send a message that 

large or politically powerful banks 

could ignore federal laws. The Johnson 

Letter also stressed that the federal 

government has an obligation to ensure 

the integrity of all companies dealing 

with pension funds. According to the 

letter, the cost to pension plans of 

moving funds away from asset managers 

affiliated with CSAG would be 

negligible if pension plans were given 

30 days to relocate their accounts. The 

letter also suggested that grant of an 

exemption would prevent CSAG’s 

criminal conviction from having its 

intended deterrent effect. Finally, the 

Blixseth letter described various 

business practices and controversies, 

which it asserted had resulted in past 

fines and settlements against CSAG and 

related entities, and argued for denial of 

the exemption application. 

The Applicant noted the commenters’ 

view that the exemption should be 

denied as a means of holding CSAG 

accountable and deterring other banks 

from criminal misconduct, but asserted 

that the Applicant nevertheless meets 

the standards under section 408(a) of 

ERISA for grant of an exemption. The 

Applicant disputed that there was any 

basis for denying an exemption to all of 

CSAG’s affiliates and related entities 

based on the misconduct of a single 

entity. According to the Applicant, the 

arguments for denial of the exemption 

are inconsistent with section 411 of 

ERISA, which authorizes the 

Department to debar a fiduciary 

convicted of a felony, but not its 

affiliates. 

The Applicant asserts that the need to 

hold CSAG accountable for criminal 

misconduct and the propriety of the 

Department of Justice’s Plea Agreement 

are not at issue in the exemption 

process. Additionally, the Applicant 

suggests that the proposed exemption 

would hold CSAG accountable, in any 

event, because the relief would only be 

available to affiliated managers (not 

CSAG) and only if they follow fourteen 

stringent new conditions, in addition to 

the seven conditions in Part I of PTE 

84–14 (including its integrity condition, 

Part I(g), as modified by the proposed 

exemption). The Applicant also states 

that CSAG already faces significant 

sanctions for criminal misconduct, as 

evidenced by its agreement to pay $2.8 

billion to the Justice Department, 

Securities and Exchange Commission, 

Internal Revenue Service, New York 

State Department of Financial Services, 

and the Federal Reserve. 

2. Spalding Letter 

The Spalding letter commented that 

the proposed exemption was 

insufficiently detailed with respect to 

the investment strategies utilized by 

affected asset managers and with respect 

to the proposed audit requirements of 

the exemption. The letter also suggested 

that the Department should take an 

active role in preventing systemic flaws 

that are tied to market making 

consortiums. 

The Applicant noted Mr. Spalding’s 

objections to the exemption and his 


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concerns with respect to derivatives and 

other investment strategies that asset 

manager affiliates of CSAG could 

pursue, but argued that the propriety of 

these strategies should properly be left 

to the named fiduciaries or IRA owners 

who hire asset managers to pursue such 

strategies. The Applicant further argued 

that such concerns were irrelevant to 

the proposed exemption, which, did not 

address or concern specific investment 

strategies. 

3. Representatives Waters, Lynch & 

Miller (the Representatives) Letter 

The Representatives suggest that the 

American public has grown increasingly 

frustrated about a lack of accountability 

in our financial system, both with 

regard to conduct contributing to the 

financial crisis and to scandals that have 

occurred since then. While they note 

that law enforcement has obtained 

record monetary settlements in response 

to financial misconduct, the 

Representatives remain concerned that 

regulators are failing to use the full 

arsenal of tools available to them to 

protect the public and retirees from bad 

actors and to ensure that criminal 

behavior is appropriately deterred. The 

Representatives suggest that the 

beneficial status of ‘‘qualified 

professional asset manager’’ should be 

reserved for institutions that have 

shown a commitment to maintaining a 

high standard of integrity via 

compliance with the law and that the 

Department’s process for evaluating 

exemption requests like the Applicant’s 

may not be sufficiently robust to 

maintain this standard. 

The Applicant asserts that the 

Department should not base its decision 

on the goals of deterrence and 

accountability for the same reasons set 

forth in its responses to the Rollins, 

Lang, Rose, Johnson, and Blixseth 

Letters, above. In addition, the 

Applicant states that conduct of other 

financial institutions in connection with 

the financial crisis and the question of 

whether those institutions have been 

appropriately punished are irrelevant to 

determining whether the Department 

should grant an exemption providing 

relief to affiliated managers of CSAG. 

The Applicant also disputes that the 

Department’s approval of past 

exemption requests relating to a failure 

of Section I(g) indicates that approval is 

automatic, thereby undermining 

financial firms’ incentives to comply 

with the law and existing exemptions. 

The Applicant states that those 

exemptions imposed additional 

conditions appropriate to the particular 

cases at issue and were granted only 

after notice and comment from 

interested parties. The Applicant asserts 

that, consistent with the requirements of 

section 408(a) of ERISA, the Department 

has exercised appropriate caution, 

evaluated the benefits of the exemption 

to plans managed by affiliates of CSAG 

and fashioned a set of stringent 

additional conditions to ensure that 

plans’ interests are protected. 

In addition, the Applicant notes that 

CSAG, the entity that entered into the 

Plea Agreement with the Justice 

Department, is receiving no relief under 

the proposed exemption and will be 

unable to rely upon PTE 84–14 for ten 

years. The Applicant states that, 

consequently, the only entities receiving 

relief under the proposed exemption are 

affiliated asset managers that are 

registered U.S. advisers, have their own 

employees, compliance systems and 

record of legal compliance and that 

were not engaged in the conduct 

underlying the Plea Agreement. The 

Applicant also states that the exemption 

does not excuse these managers from 

compliance with Section I(g) of PTE 84– 

14, which requires that neither the 

manager nor its affiliates have been 

convicted of certain crimes. Under the 

proposed exemption, Section I(g) will 

continue to apply, with the sole 

exception of the Conviction resulting 

from the Plea Agreement. 

Finally, the Applicant points to the 

imposition of fourteen additional 

substantive conditions in the proposed 

exemption, in addition to the seven 

conditions found in Part I of PTE 84–14, 

which include, among other things, 

compliance reviews by an independent 

auditor, policies and procedures 

covering six different substantive areas 

(e.g., independence of QPAM decisions 

from CSAG, ERISA compliance, and 

prompt reporting of violations), training 

on those policies and procedures, an 

annual audit, and significant reporting 

to plans and to the Department. The 

Applicant adds that the new conditions 

also require that no employee who 

participated in the conduct underlying 

the Plea Agreement be involved in the 

affiliate’s asset management decisions, 

and that the affiliate will not cause 

plans to trade with, or procure services 

for a fee from CSAG, ensuring 

separation of the affiliates’ asset 

management decisions from the 

influence of CSAG. 

4. Public Citizen Letter 

In its letter, Public Citizen stresses the 

importance of deterring criminal 

activity and expresses its view that grant 

of the exemption would undermine 

deterrence. In addition, Public Citizen 

questions whether it can be verified that 

employees of CSAG’s affiliates were 

uninvolved in the crime. The Applicant 

believes that its response to the letters 

from Rollins, Lang, Rose, Johnson, and 

Blixseth is also responsive to Public 

Citizen’s concern about deterrence and 

corporate abuse. The Applicant 

additionally argues that CSAG engaged 

in an extensive due diligence process to 

ensure that it could certify the truth of 

its statement that its affiliates’ 

employees were uninvolved in CSAG’s 

criminal activities, and that, as a 

protective safeguard, the proposed 

exemption is expressly conditioned on 

the fact that no employee involved in 

the crime will participate in the asset 

management decisions of the 

investment managers. 

5. Financial Recovery and Consulting 

Services Pty Ltd (FRCS) Letter 

The FRCS letter explains that FRCS 

represents international and U.S. former 

customers of CSAG who were victims of 

a fraud or embezzlement. The letter 

outlines information that FRCS believes 

should have been, but was not, included 

in CSAG’s application to the 

Department requesting the proposed 

exemption. FRCS requests that the 

Department only consider granting 

temporary relief to the Applicant, if any 

relief is to be given. In support of this 

request, FRCS submitted a history of 

conduct at various Credit Suisse 

affiliates that FRCS considers corrupt. 

Finally, FRCS suggests that CSAG’s 

application does not meet the statutory 

requirements for an exemption to be 

issued. 

In response, the Applicant objects to 

any suggestion that the Department 

deny the exemption as a means to 

punish CSAG for misconduct, and 

references its response to the similar 

concerns expressed in the Rollins, Lang, 

Rose, Johnson, and Blixseth Letters. The 

Applicant also disputes FRCS’ argument 

that plan costs could be reduced 

appropriately by granting temporary 

relief to allow Credit Suisse affiliates to 

liquidate plan accounts over time. 

Furthermore, the Applicant states that 

the comment failed to take into account 

the costs that denying the exemption 

would impose on plans that continue to 

use CSAG affiliates to manage their 

assets. According to CSAG, those plans 

would lose access to the trading and 

pricing efficiencies that PTE 84–14 

affords for a period of ten years after the 

conviction. 

Applicant’s Comment 

The Applicant’s comment generally 

requests a variety of changes to the 

operative language of the exemption, 

requests clarification on the meaning of 

certain language, and provides 


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1For PTE 75–1, see 40 FR 50845 (October 31, 

1975), as amended at 69 FR 23216 (April 28, 2004), 

71 FR 5883 (February 3, 2006), and 78 FR 37572 

(June 21, 2013); for PTE 2008–07, see 73 FR 27565 

(May 13, 2008). 

2Section VI(e) of PTE 84–14 defines the term 

‘‘control’’ as the power to exercise a controlling 

influence over the management or policies of a 

person other than an individual. 

additional information in support of any 

requests for changes or clarification. 

1. Section I(b). 

As proposed, Section I(b) of the 

exemption conditions relief on a 

requirement that the Credit Suisse 

Affiliated QPAMs, Credit Suisse Related 

QPAMs, and their officers, directors, 

‘‘agents,’’ and employees not have 

participated in the criminal conduct 

that is the subject of the Conviction. The 

Applicant requests that the term 

‘‘agents’’ be removed from Section I(b). 

The Applicant states that, to the best of 

its knowledge after due inquiry, the 

Credit Suisse Affiliated QPAMs and the 

Credit Suisse Related QPAMs did not 

participate in the criminal conduct nor 

did their officers, directors, or 

employees. However, the Applicant 

notes that CSAG, which was involved in 

the criminal conduct, could have 

previously acted as an agent for a Credit 

Suisse Affiliated QPAM in some 

capacity that is unconnected to its 

criminal conduct or asset management 

decisions, such as service of process in 

a foreign country. Therefore, in light of 

the potentially broad scope of the term 

‘‘agents,’’ the Applicant is reluctant to 

make a representation that includes the 

term ‘‘agents.’’ After consideration of 

the comment, the Department has 

substituted ‘‘agents other than Credit 

Suisse AG’’ for the term ‘‘agents.’’ Thus, 

subject to this modification, it remains 

a condition of the exemption that ‘‘[t]he 

Credit Suisse Affiliated QPAMs and the 

Credit Suisse Related QPAMs (including 

officers, directors, agents other than 

Credit Suisse AG, and employees of 

such QPAMs) did not participate in the 

criminal conduct of Credit Suisse AG 

that is the subject of the Conviction.’’ 

Accordingly, the QPAMs, their officers, 

directors, agents (other than CSAG), and 

employees must not have aided, assisted 

in, procured, counseled, or advised the 

preparation and presentation of false 

income tax returns and other documents 

to the Internal Revenue Service of the 

Treasury Department. 

2. Section I(d). 

The Applicant requests clarification 

that an ‘‘ERISA-covered plan’’ or ‘‘IRA’’ 

in Section I(d) and throughout the 

exemption refers only to plans subject to 

Part 4 of Title I of ERISA and section 

4975 of the Code. That was the 

Department’s intent and it has, 

therefore, clarified that an ‘‘ERISAcovered plan’’ or ‘‘IRA’’ refers only to 

such plans by substituting ‘‘subject to 

Part 4 of Title I of ERISA’’ for 

‘‘described in section 3(3) of ERISA’’ 

and ‘‘section 4975 of the Code’’ for 

‘‘section 4975(e)(1) of the Code.’’ Thus, 

subject to this modification, it remains 

a condition of the exemption that ‘‘[t]he 

criminal conduct of Credit Suisse AG 

that is the subject of the Conviction did 

not directly or indirectly involve the 

assets of any plan subject to Part 4 of 

Title I of ERISA (an ERISA-covered 

plan) or section 4975 of the Code (an 

IRA). 

3. Section I(f). 

As proposed, Section I(f) of the 

exemption provides that a Credit Suisse 

Affiliated QPAM will not use its 

authority or influence to direct an 

investment fund managed by the QPAM 

to enter into any transaction with Credit 

Suisse AG or engage Credit Suisse AG 

to provide additional services for a fee 

borne by the investment fund. 

The Applicant requests that Section 

I(f) provide an exception for certain 

subcustody arrangements entered into 

with CSAG by global custodians that are 

unaffiliated with CSAG. According to 

the Applicant, to the extent that a Credit 

Suisse Affiliated QPAM invests in a 

market where CSAG is the local 

subcustodian or effects the transaction 

in that market, CSAG could receive 

compensation from the global 

custodian. 

The Department declines to add a 

specific exception to the language in 

Section I(f) as requested by the 

Applicant. In this regard, the 

Department is concerned about the 

potential for self-dealing inasmuch as, 

depending on the facts and 

circumstances, a Credit Suisse Affiliated 

QPAM might effectively use its 

‘‘authority or influence to direct’’ an 

investment fund to ‘‘enter into any 

transaction with’’ CSAG or ‘‘provide 

additional services, for a fee borne by’’ 

the investment fund. The Department 

notes, however, that it is not expressing 

a view on whether any particular 

transaction would constitute a separate 

prohibited transaction under ERISA or 

the Code. 

The Applicant also requests 

clarification that if a Credit Suisse 

Affiliated QPAM obtains services from 

CSAG without cost to an ERISA-covered 

plan or IRA (e.g., at the QPAM’s own 

expense), the condition in Section I(f) 

will not be violated. The Department 

clarifies that services provided for no 

additional cost to an ERISA-covered 

plan or IRA would not fall within the 

scope of Section I(f). Accordingly, the 

Department has modified the phrase 

‘‘provide additional services for a fee to 

the investment fund’’ to read, ‘‘provide 

additional services to such investment 

fund, for a direct or indirect fee borne 

by such investment fund’’ to make the 

intent of this Section I(f) clear. 

The Applicant additionally requests 

that Section I(f) provide an exception for 

transactions covered under PTE 75–1, 

Part III and PTE 2008–07,1 which permit 

Credit Suisse Affiliated QPAMs to 

purchase securities from third parties in 

an underwriting syndicate where a 

Credit Suisse Affiliated QPAM’s affiliate 

is a member or manager of the 

underwriting syndicate. The Applicant 

believes that prohibiting the use of such 

exemptions would harm plans, 

especially with respect to foreign 

issuers, where CSAG may often be a 

manager or member of an underwriting 

syndicate. The Department declines to 

add language that excepts transactions 

covered by PTE 75–1, Part III and PTE 

2008–07 from this condition because the 

transactions permitted by these PTEs are 

not within the scope of transactions 

prohibited under Section I(f). 

4. Section I(g). 

Section I(g) of the proposed 

exemption provides that Credit Suisse 

AG and each Credit Suisse Affiliated 

QPAM will ensure that no employee or 

agent involved in the criminal conduct 

that underlies the Conviction will 

engage in transactions on behalf of any 

investment fund. The Applicant 

requests that the reference to ‘‘Credit 

Suisse AG’’ be removed from this 

section since CSAG is the convicted 

entity and the Credit Suisse Affiliated 

QPAMs are in the best position to 

ensure compliance with the 

requirements of the condition provided 

in Section I(g). Additionally, the 

Applicant represents that CSAG lacks 

the authority to monitor all of the Credit 

Suisse Affiliated QPAMs or to dictate 

hiring decisions because CSAG may not 

have operational control of certain 

Credit Suisse Affiliated QPAMs despite 

having ‘‘control’’ (as that term is defined 

in Section VI(e) of PTE 84–14) 2 over 

such entities. The Department concurs 

that the responsibility for complying 

with this condition should be imposed 

upon the Credit Suisse Affiliated 

QPAMs, and has removed the reference 

to ‘‘Credit Suisse AG’’ in Section I(g) 

and also added ‘‘Each’’ to the beginning 

of this section to clarify that the 

condition is imposed upon each 

individual Credit Suisse Affiliated 

QPAM and that each such Credit Suisse 

Affiliated QPAM is responsible only for 

maintaining its own compliance, rather 

than the compliance of all other Credit 

Suisse Affiliated QPAMs. Furthermore, 

the phrase ‘‘subject to ERISA’’ has been 


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added to Section I(g) after the reference 

to ‘‘investment fund’’ to provide 

additional clarification that Section I(g) 

only applies to investment funds for 

which relief under PTE 84–14 is used. 

Additionally, the Applicant requests 

clarification that a Credit Suisse 

Affiliated QPAM’s failure to comply 

with this condition will prevent only 

that particular QPAM from relying on 

this exemption rather than disqualifying 

all of the other Credit Suisse Affiliated 

QPAMs. The Department believes that 

the changes noted above, combined 

with changes made to Section I(n), 

discussed below, provide the necessary 

clarification to this section and address 

the Applicant’s concerns. 

Finally, the Applicant requests that 

the term ‘‘agent’’ be removed from this 

section because of its breadth. The 

Department declines to remove the term 

‘‘agent’’ because it could permit the 

Credit Suisse Affiliated QPAMs to use 

individuals involved in CSAG’s 

criminal activities as their agents. 

Accordingly, Section I(g) provides that 

each Credit Suisse Affiliated QPAM is 

obligated to ensure that none of its 

employee or agents, if any, that were 

involved in the criminal conduct that 

underlies the Conviction will engage in 

transactions on behalf of the investment 

funds it manages. 

5. Section I(h). 

Section I(h) of the proposed 

Exemption requires the Applicant to 

adopt and adhere to specified policies 

and procedures (the Policies). The 

Applicant requests that the scope of 

Section I(h) be clarified to make clear 

that the requirements of Section I(h) 

apply to the Credit Suisse Affiliated 

QPAMs’ ERISA-covered plan and IRA 

clients. The Applicant notes that, in its 

original form, this section could be 

interpreted to apply to the assets of 

other individuals and entities that are 

not subject to ERISA or the Code. The 

Applicant also asks the Department to 

provide clarification on the scope of 

laws covered by Section I(h)’s 

requirement of compliance with various 

state and federal laws, including 

whether such compliance specifically 

relates to the asset management 

activities of the QPAMs with respect to 

their ERISA-covered plans and IRAs. 

The Department notes that Section 

I(h) only applies to ERISA-covered 

plans and IRAs since the relief in PTE 

84–14 only applies to such plans and 

IRAS. However, the Department agrees 

that additional language could clarify 

this intent. Therefore, the Department 

has added qualifying language, where 

appropriate, to indicate that the 

requirements of Section I(h) apply to 

ERISA-covered plans and IRAs, and 

with respect to compliance with the 

requirements of ERISA and the Code. 

The Applicant also requests that the 

term ‘‘follow’’ be removed from the 

prefatory clause of Section I(h), which 

requires the Credit Suisse Affiliated 

QPAMs to follow and adhere to the 

mandated Policies. The Applicant 

objects that if ‘‘follow’’ is interpreted 

strictly, it could result in a failure by a 

Credit Suisse Affiliated QPAM to meet 

the condition in this section if a Credit 

Suisse Affiliated QPAM does not 

perfectly adhere to the Policies and 

avoid all mistakes, including 

inadvertent, technical, or good faith 

errors. Alternatively, the Applicant asks 

for clarification that the term ‘‘follow’’ 

means only that a Credit Suisse 

Affiliated QPAM must promptly follow 

the Policies’ correction and reporting 

mechanisms when it knows or should 

know of a violation of such Policies. 

The Department declines to remove 

the term ‘‘follow’’ from the prefatory 

clause of Section I(h), inasmuch as it 

intends for the Credit Suisse Affiliated 

QPAMs not only to adopt the mandated 

Policies, but also to adhere to them. The 

Department agrees, however, that the 

Credit Suisse Affiliated QPAMs—and 

the plans they serve—should not run 

the risk of losing the exemption based 

on inadvertent, good faith, or de 

minimis compliance errors. 

Accordingly, the Department has 

amended Subsection I(h)(vii) of the 

exemption to provide that they will not 

be treated as having failed to develop, 

implement, maintain or follow the 

Policies, provided that they correct any 

instances of noncompliance promptly 

when discovered or when they 

reasonably should have known of the 

noncompliance (whichever is earlier), 

and provided that they adhere to the 

reporting requirements for violations 

that are not promptly corrected. 

The Applicant also requests that the 

reference to ‘‘asset management 

operations’’ be removed from 

Subsection I(h)(1)(i). The Applicant 

explains that ‘‘asset management 

decisions’’ fully encompasses fiduciary 

decision-making by Credit Suisse 

Affiliated QPAMs. In contrast, ‘‘asset 

management operations’’ could include 

unrelated business activities, such as 

information technology security, 

employee non-discrimination, and 

workplace, safety, and health issues, 

matters in which CSAG may, in fact, be 

involved, but which have no impact on 

the independence of asset management 

decisions. Based on this additional 

information provided by the Applicant, 

the Department concurs and has 

removed the phrase ‘‘and asset 

management operations’’ from this 

subsection. 

Furthermore, the Applicant requests 

that references to ‘‘Credit Suisse AG’’ be 

removed from Subsection I(h)(1)(ii)–(vii) 

because CSAG does not act as a 

fiduciary for ERISA-covered plans or 

IRAs in reliance on PTE 84–14. 

Additionally, the Applicant suggests 

that imposing these requirements on 

CSAG would potentially impact 

branches in non-U.S. markets that do 

not have any ERISA-covered plan or 

IRA clients. The Department concurs 

that this condition should only apply to 

each Credit Suisse Affiliated QPAM that 

relies upon PTE 84–14. Therefore, 

consistent with other sections where the 

phrase ‘‘Credit Suisse AG’’ has been 

removed, it has also been removed from 

these subsections. 

The Applicant also requests that the 

filing requirements in Subsections 

I(h)(1)(iv) and (v) be modified to clarify 

that they apply only to filings with 

regulators of ERISA-covered plans and 

IRAS, including the Department of 

Labor, Department of the Treasury, 

Department of Justice, and the Pension 

Benefit Guaranty Corporation. The 

Department generally concurs with this 

modification, but notes that the 

regulators identified in the operative 

language are listed solely as examples. 

To the extent that Credit Suisse 

Affiliated QPAMs engage in filings on 

behalf of ERISA-covered plans and IRAs 

with other regulators, those filings 

would also be covered by these 

subsections. Therefore, the Department 

has modified the phrase ‘‘any filings or 

statements made to federal, state, or 

local government are accurate and 

complete’’ in Subsection I(h)(1)(iv) to 

read, ‘‘any filings or statements made by 

the Credit Suisse Affiliated QPAMs to 

regulators, including but not limited to, 

the Department of Labor, the 

Department of the Treasury, the 

Department of Justice, and the Pension 

Benefit Guaranty Corporation, on behalf 

of ERISA-covered plans or IRAs are 

materially accurate and complete, to the 

best of such QPAM’s knowledge at that 

time.’’ Additionally, the Department has 

modified the phrase ‘‘the Credit Suisse 

Affiliated QPAMs do not make material 

misrepresentations or omit material 

information in their communications 

with federal, state, or local government, 

or their ERISA-covered plan and IRA 

clients’’ in Subsection I(h)(1)(v) to read, 

‘‘the Credit Suisse Affiliated QPAM 

does not make material 

misrepresentations or omit material 

information in its communications with 

such regulators with respect to ERISAcovered plans or IRAs, or make material 

misrepresentations or omit material 


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information in its communications with 

ERISA-covered plan and IRA clients.’’ 

The Applicant requests that the 

condition in Subsection I(h)(1)(vii) 

requiring reporting of violations to 

specified persons apply only when a 

Credit Suisse Affiliated QPAM fails to 

follow the correction and reporting 

mechanisms built into the Policies, and 

not in every instance. The Applicant 

suggests that reporting every error, even 

those that are generally considered 

correctable in accordance with ERISA or 

the Code, may overwhelm the reports’ 

recipients and provide little protection 

to ERISA-covered plans and IRAs. The 

Department agrees with the Applicant 

and has modified the phrase ‘‘any 

violations of or failure to comply with 

items (ii) through (vi) are promptly 

reported in writing’’ in Subsection 

I(h)(1)(vii) to read, ‘‘any violations of or 

failure to comply with items (ii) through 

(vi) are corrected promptly upon 

discovery and any such violations or 

compliance failures not promptly 

corrected are reported, upon discovering 

the failure to promptly correct, in 

writing . . .’’ 

The Department notes, however, that 

as part of the auditor’s review of the 

operational compliance of each Credit 

Suisse Affiliated QPAM (as noted in 

Subsection I(i)(3)), each Credit Suisse 

Affiliated QPAM should provide 

documentation to the auditor that 

reflects any appropriate corrections 

made as outlined in the Policies. The 

Department notes further that the 

documentation of the errors is a means 

by which the auditor may test 

operational compliance with the 

Policies and demonstrate a QPAM’s 

ERISA and Code compliance. 

The Applicant requests additional 

clarification with respect to Subsection 

I(h)(1)(vii). First, the Applicant requests 

that each Credit Suisse Affiliated QPAM 

be required to report to its own General 

Counsel for Asset Management and 

head of Compliance, positions which 

currently exist at each Credit Suisse 

Affiliated QPAM. Second, the Applicant 

requests that the Department clarify that 

a ‘‘non-QPAM fiduciary’’ in the context 

of this subsection is a fiduciary for any 

affected ERISA-covered plan or IRA 

who is independent of the Applicant 

and its affiliates, regardless of whether 

such fiduciary also happens to be a 

QPAM, but that such fiduciary need not 

be independent when dealing with one 

of its affiliates’ own plans or the IRAs 

of their employees. The Department 

concurs that clarification is appropriate 

and has thus changed ‘‘the head of U.S. 

Asset Management Compliance’’ and 

‘‘the General Counsel for Asset 

Management’’ to ‘‘the head of 

Compliance’’ and ‘‘the General Counsel 

of the relevant Credit Suisse Affiliated 

QPAM.’’ The Department has also 

modified ‘‘non-QPAM fiduciary of any 

affected ERISA-covered Plan or IRA’’ to 

read, ‘‘a fiduciary of any affected ERISAcovered plan or IRA where such 

fiduciary is independent of Credit 

Suisse AG; however, with respect to any 

ERISA-covered plans or IRAs sponsored 

by an affiliate (as defined in Section 

VI(d) of PTE 84–14) of Credit Suisse AG 

or beneficially owned by an employee of 

Credit Suisse AG or its affiliates, such 

fiduciary does not need to be 

independent of Credit Suisse AG.’’ 

The Applicant also requests that 

Subsections I(h)(1) and I(h)(2), with 

respect to reporting violations, only 

apply to violations with respect to the 

development and implementation of the 

Policies and Training. The Department 

disagrees that such a limitation is 

appropriate because those subsections 

simply outline what should be included 

in the Policies and Training. 

Additionally, the Department notes the 

other changes made to Subsection 

I(h)(1) significantly clarify the nature of 

violations and compliance failures that 

must be reported. Finally, the 

Department notes that the Credit Suisse 

Affiliated QPAMs, as fiduciaries, may 

have additional notification 

responsibilities and duties outside the 

scope of this exemption. 

6. Section I(i). 

The Applicant requests that 

references to ‘‘Credit Suisse AG’’ be 

removed from Section I(i) since only the 

Credit Suisse Affiliated QPAMs will 

have Policies and Training in place. The 

Department concurs with this change 

and has removed all references to 

‘‘Credit Suisse AG’’ from Subsection I(i) 

except in Subsection I(i)(4), which 

requires that CSAG, the parent company 

of the Credit Suisse Affiliated QPAMs, 

also receive the Audit Reports. It is the 

Department’s view that CSAG should 

generally be on notice of the legal 

compliance efforts of its subsidiaryaffiliates. 

The Applicant additionally requests 

clarification that the audit requirement 

will apply to a Credit Suisse Affiliated 

QPAM only at such time as it has 

ERISA-covered plan clients or IRA 

clients for which it relies upon PTE 84– 

14. The Department notes that any 

current and future affiliates that are not 

currently relying on PTE 84–14 for 

transactions need not submit to an audit 

(and therefore need not have Policies 

and Training in place) until such time 

as they begin relying on the relief in 

PTE 84–14. 

Furthermore, the Applicant requests 

that the compliance review, 

determination, and testing contemplated 

in Subsections I(i)(1), (2), and (3) should 

be limited to the development, 

maintenance, and implementation of the 

Policies and Training. The Department 

believes that based on modifications 

already made to Section I(h), limiting 

this condition as requested by the 

Applicant is unnecessary. Section I(h) 

has already been modified to apply to 

ERISA-covered plans and IRAs and 

compliance with laws applicable to 

such plans and IRAs. Additionally, the 

Department believes operational 

compliance is an important aspect of 

protecting ERISA-covered plan and IRA 

clients of the Credit Suisse Affiliated 

QPAMs. Therefore, the Department 

declines to limit Subsections I(i)(1), (2), 

and (3) in the requested manner. 

The Applicant requests confirmation 

that, with respect to the audit 

requirement in Section I(i) of the 

exemption, each of the Credit Suisse 

Affiliated QPAMs may be covered by a 

separate audit and Audit Report. The 

Applicant notes that there are situations 

where a Credit Suisse Affiliated QPAM 

is not wholly owned by CSAG, and such 

QPAM might be a competitor with 

another Credit Suisse Affiliated QPAM. 

The Department did not intend to 

require that all of the Credit Suisse 

Affiliated QPAMs be covered by a single 

Audit Report and has substituted the 

phrase ‘‘each Credit Suisse Affiliated 

QPAM’’ in place of ‘‘the Credit Suisse 

Affiliated QPAMs,’’ where appropriate 

in Section I(i), to reflect the requested 

confirmation. 

The Applicant also requests that the 

Department confirm that the phrase 

‘‘any instances of Credit Suisse AG’s or 

the Credit Suisse Affiliated QPAMs’ 

noncompliance with the written 

Policies and Training described in 

paragraph (h) above,’’ In Subsection 

I(i)(4) refers only to failures to develop 

and implement the Policies and 

Training. The Department notes that 

this language, now modified to remove 

the reference to ‘‘Credit Suisse AG’’ 

requires that any instances of 

noncompliance which are not corrected 

in accordance with the Policies and 

which are reported separately to the 

Auditor under Subsection I(h)(1)(vii) 

should be noted in the Audit Report. 

The auditor may also choose to utilize 

its discretion under this requirement to 

include, for example, a type of error that 

occurs frequently despite being properly 

corrected on each occasion, where, in 

the auditor’s independent judgment, 

such repeated errors might rise to a level 

that the auditor determines should be 

addressed by a particular Credit Suisse 

Affiliated QPAM. 


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The Applicant requests clarification 

that where the auditor identifies an 

instance of noncompliance while 

engaging in the audit, under Subsection 

I(i)(5), that such notification only needs 

to be sent to the Credit Suisse Affiliated 

QPAM to which it applies. The 

Department notes that the Applicant’s 

understanding of Subsection I(i)(5) is 

correct and has modified the phrase 

‘‘The auditor shall notify Credit Suisse 

AG and the Credit Suisse Affiliated 

QPAMs’’ in Subsection I(i)(5) to read, 

‘‘The auditor shall notify the respective 

Credit Suisse Affiliated QPAM’’ in order 

to provide additional clarification. 

Furthermore, the Department has 

decided to strike the sentence, ‘‘Credit 

Suisse AG or a Credit Suisse Affiliated 

QPAM shall provide written notice to 

the Department’s Office of Exemption 

Determinations (OED), Room N–5700, 

200 Constitution Avenue NW., 

Washington, DC 20210: Of any instances 

of noncompliance reviewed by the 

auditor within ten (10) business days 

after such notice is received from the 

auditor’’ from the final temporary 

exemption because all such instances of 

noncompliance should be included in 

the Audit Reports, which the 

Department will receive upon 

completion thereof. 

The Applicant notes that in the last 

sentence of Subsection I(i)(5), the 

reference to an ‘‘explanation of any 

corrective actions taken by Credit Suisse 

AG’’ should refer to corrective actions 

taken by a Credit Suisse Affiliated 

QPAM since the Credit Suisse Affiliated 

QPAMs must operate independently of 

CSAG. The Department concurs and has 

changed that phrase so that it now 

reads, ‘‘explanation of any corrective or 

remedial actions taken by the respective 

Credit Suisse Affiliated QPAM.’’ 

Finally, the Applicant requests that 

the reference to ‘‘Credit Suisse AG’’ also 

be removed from Subsection I(i)(6) and 

that the executive officer of each Credit 

Suisse Affiliated QPAM only be 

responsible for certifying its own Audit 

Report. The Department concurs that 

the executive of each Credit Suisse 

Affiliated QPAM officer need only 

certify the Audit Report for the 

particular QPAM for which he/she 

works. However, the Department 

believes it is important for CSAG to be 

on notice of the content contained in the 

Audit Reports. Therefore, the 

Department has modified the language 

in Subsection I(i)(6) to indicate that 

each Credit Suisse Affiliated QPAM is 

responsible for certifying its own audit 

and the sufficiency of its Policies and 

Training, but has added new Subsection 

I(i)(7) that requires an executive officer 

of CSAG to certify in writing that he/she 

has reviewed the Audit Reports of the 

Credit Suisse Affiliated QPAMs. The 

former Subsection I(i)(7) has been 

renumbered as I(i)(8). 

7. Section I(k). 

Additionally, the Applicant asserts 

that the phrase ‘‘or other services’’ in 

Section I(k) requiring CSAG and the 

Credit Suisse Affiliated QPAMs to agree 

to certain undertakings in their 

agreements with their ERISA-covered 

plan and IRA clients, may be overbroad, 

especially as it applies to one of the 

Credit Suisse Affiliated QPAMs that is 

a dual-registrant (i.e., both broker-dealer 

and investment adviser). Therefore, the 

Applicant requests that the phrase ‘‘or 

other services’’ in Section I(k) be 

changed to read, ‘‘or other discretionary 

fiduciary services.’’ The Department 

concurs with the Applicant’s request to 

clarify the scope of Section I(k), and has 

altered Section I(k) accordingly. 

The Applicant also notes that, with 

respect to the undertakings required by 

Section I(k), the Credit Suisse Affiliated 

QPAMs do not have the authority to 

unilaterally modify their contracts with 

ERISA-covered plans and IRAs, and that 

getting bilateral approval of such a 

change with each client would be timeconsuming. Therefore, the Applicant 

proposes that the Department impose a 

unilateral requirement on the Credit 

Suisse Affiliated QPAMs which would 

effectively incorporate the same 

protections for ERISA-covered plans 

and IRAs. The Department concurs that 

this is a sensible modification that will 

not reduce the protections for ERISAcovered plans and IRAs, and, 

accordingly, the exemption has been 

modified to require that the Credit 

Suisse Affiliated QPAMs send notice to 

their ERISA-covered plan and IRA 

clients of this unilateral requirement 

within six months of the date of a final 

granted exemption in the Federal 

Register. Additionally, the Department 

has added language that clearly makes 

the undertakings required by Section 

I(k) effective immediately upon 

publication of this final granted 

temporary exemption, although the 

Credit Suisse Affiliated QPAMs have six 

months to complete the notification. 

The Applicant requests that ‘‘the 

Code’’ be referenced in appropriate 

places in Section I(k) to clarify the scope 

of the applicability to IRAs. The 

Department concurs and has modified 

the language in Section I(k) where 

appropriate. 

The Applicant also requests 

clarification whether, under Section 

I(k), the Credit Suisse Affiliated QPAMS 

are prohibited from being indemnified 

for prohibited transactions that are not 

caused by the Credit Suisse Affiliated 

QPAMs (i.e., where the plan fiduciary or 

a service provider selected by the plan 

fiduciary and unrelated to CSAG or a 

Credit Suisse Affiliated QPAM causes a 

prohibited transaction or error). The 

Department confirms that the Credit 

Suisse Affiliated QPAMs are not 

prohibited from being indemnified in 

such circumstances, and the Department 

has added the phrase ‘‘except for 

violations or prohibited transactions 

caused by an error, misrepresentation, 

or misconduct of a plan fiduciary or 

other party hired by the plan fiduciary 

who is independent of Credit Suisse 

AG’’ to clause (3) of Section I(k). 

Finally, the Applicant requests a 

modification to the requirement in 

Section I(k) that provides that any 

agreements between CSAG, Credit 

Suisse Affiliated QPAMs, and their 

ERISA-covered plan and IRA clients 

allow for such clients to terminate or 

withdraw from their arrangements with 

CSAG or the Credit Suisse Affiliated 

QPAMs without any fees, penalties or 

other charges. The Applicant requests 

that such requirement only apply to 

separately managed accounts and only 

with respect to undisclosed or 

unreasonable fees, penalties, or charges 

for such termination or withdrawal. The 

Applicant represents that all such 

agreements have reasonable termination 

provisions, such as 30 days’ advance 

notice, and in the case of separately 

managed accounts, a plan fiduciary can 

remove assets from an asset manager’s 

control immediately, in any event. 

However, the Applicant informs the 

Department that in a pooled fund, 

depending on the investment strategy, a 

longer withdrawal period may be 

required to protect other investors or 

address limited liquidity in fund assets, 

which has been fully disclosed and 

agreed to by plan fiduciaries. 

Additionally, the Applicant adds that 

there may be redemption fees in a 

pooled fund, which are directed at 

preventing market timing in order to 

protect other investors in the fund. The 

Department notes that the language in 

Section I(k) was not intended to prevent 

reasonable fees which are intended to 

protect other investors or prevent 

market abuses, but rather to cover fees 

or charges that could otherwise 

discourage a client from moving to a 

new asset manager. Therefore, the 

Department has added clarifying 

language at the end of clause (5) of 

Section I(k) that excepts ‘‘reasonable 

fees, appropriately disclosed in 

advance, that are specifically designed 

to prevent generally recognized abusive 

investment practices or specifically 

designed to ensure equitable treatment 


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of all investors in a pooled fund in the 

event such withdrawal or termination 

may have adverse consequences for all 

other investors, provided that such fees 

are applied consistently and in like 

manner to all such investors.’’ 

8. Section I(m). 

The Applicant requests confirmation 

that, in accordance with Section I(m), 

notice to interested persons is required 

to be sent only to ERISA-covered plans 

and IRAs with respect to which PTE 84– 

14 may be used and that were clients as 

of the date the proposal was published 

in the Federal Register. The Department 

confirms this understanding. 

9. Section I(n). 

The Applicant asks for clarification in 

three areas with respect to Section I(n). 

First, the Applicant requests 

clarification that a Credit Suisse 

Affiliated QPAM will not fail to meet 

the terms of the exemption solely 

because a different Credit Suisse 

Affiliated QPAM or a Credit Suisse 

Related QPAM fails to satisfy a 

condition for relief under this 

exemption. The Department clarifies 

that a Credit Suisse Affiliated QPAM 

will not fail to meet the terms of the 

exemption if a Credit Suisse Related 

QPAM fails to satisfy a condition for 

relief. However, as originally drafted, if 

one Credit Suisse Affiliated QPAM 

failed to meet the terms of the 

exemption, all other Credit Suisse 

Affiliated QPAMs could be disqualified. 

After further consideration, the 

Department decided that it is not 

appropriate to jeopardize the 

transactions of ERISA-covered plans 

and IRAs that have no relationship to 

the particular Credit Suisse Affiliated 

QPAM that fails to meet a condition. 

Therefore, the sentence in Section I(n) 

that reads, ‘‘A Credit Suisse Affiliated 

QPAM will not fail to meet the terms of 

this proposed exemption, if granted, 

solely because a Credit Suisse Related 

QPAM fails to satisfy a condition for 

relief under this exemption’’ has been 

modified to read, ‘‘A Credit Suisse 

Affiliated QPAM will not fail to meet 

the terms of this exemption solely 

because a Credit Suisse Related QPAM 

or a different Credit Suisse Affiliated 

QPAM fails to satisfy a condition for 

relief under this exemption.’’ 

Second, the Applicant requests 

clarification that if a Credit Suisse 

Affiliated QPAM fails to meet the 

conditions of the exemption for a 

particular transaction or a particular 

ERISA-covered plan or IRA, such failure 

only precludes the Credit Suisse 

Affiliated QPAM’s reliance on the 

exemption for such transaction or 

ERISA-covered plan or IRA for the 

period of non-compliance. The 

Department confirms the Applicant’s 

understanding and clarifies that, to the 

extent that the conditions of PTE 84–14 

are incorporated by reference into this 

exemption, failure to satisfy a condition 

of PTE 84–14 will have the same effect 

as it would if the Applicant was 

operating only under PTE 84–14. That 

is, the relief will not be available for a 

particular transaction, as opposed to an 

absolute bar to use of the exemptive 

relief for all future transactions. 

However, the conditions that are unique 

to this individual exemption must be 

met in their entirety in order for Credit 

Suisse Affiliated QPAMs or Credit 

Suisse Related QPAMs to remain 

eligible for the relief in this exemption. 

Third, the Applicant requests 

clarification that the failure of a Credit 

Suisse Related QPAM or CSAG to 

satisfy a condition of this exemption 

will not cause a Credit Suisse Related 

QPAM to lose the relief herein. The 

Department clarifies that a Credit Suisse 

Related QPAM will not lose the relief in 

this exemption due to any failures of 

another Credit Suisse Related QPAM or 

CSAG. However, if CSAG fails to review 

the Audit Reports, as required by 

Subsection I(i)(7), CSAG will jeopardize 

the availability of relief under this 

individual exemption for all of the 

Credit Suisse Affiliated QPAMs. 

Conclusion 

After giving full consideration to the 

entire record, including the written 

comments, subject to the Department’s 

responses thereto, the Department has 

decided to grant a temporary exemption, 

as modified. The exemption will be 

effective as of the date a judgment of 

conviction against Credit Suisse AG for 

one count of conspiracy to violate 

section 7206(2) of the Internal Revenue 

Code in violation of Title 18, United 

States Code, Section 371 is entered in 

the District Court for the Eastern District 

of Virginia in Case Number 1:14–cr– 

188–RBS and expire one year from the 

date of publication in the Federal 

Register. 

This exemption is granted on a 

temporary basis to accommodate 

requests for a public hearing on whether 

to grant longer term relief without 

risking the immediate loss of exemptive 

relief upon entry of a judgment of 

conviction. This exemption will prevent 

disruptions in retirement plan 

investments while a final determination 

is made on the Credit Suisse Affiliated 

QPAM’s and the Credit Suisse Related 

QPAM’s ability to serve retirement plan 

clients under PTE 84–14. At the same 

time that the Department is issuing this 

exemption, it is also publishing a 

proposed exemption for longer term 

relief and a notice of a public hearing on 

whether to grant such longer term relief 

to the Credit Suisse Affiliated QPAMs 

and the Credit Suisse Related QPAMs. 

The complete application file is 

available for public inspection in the 

Public Disclosure Room of the 

Employee Benefits Security 

Administration, Room N–1515, U.S. 

Department of Labor, 200 Constitution 

Avenue NW., Washington, DC 20210. 

For a more complete statement of the 

facts and representations supporting the 

Department’s decision to grant this 

exemption, refer to the proposed 

exemption published in the Federal 

Register on September 3, 2014 at 79 FR 

52365. 

General Information 

The attention of interested persons is 

directed to the following: 

(1) The fact that a transaction is the 

subject of an exemption under section 

408(a) of the Act or section 4975(c)(2) of 

the Code does not relieve a fiduciary or 

other party in interest or disqualified 

person from certain other provisions of 

the Act and/or the Code, including any 

prohibited transaction provisions to 

which the exemption does not apply 

and the general fiduciary responsibility 

provisions of section 404 of the Act, 

which, among other things, require a 

fiduciary to discharge his duties 

respecting the plan solely in the interest 

of the participants and beneficiaries of 

the plan and in a prudent fashion in 

accordance with section 404(a)(1)(B) of 

the Act; nor does it affect the 

requirement of section 401(a) of the 

Code that the plan must operate for the 

exclusive benefit of the employees of 

the employer maintaining the plan and 

their beneficiaries; 

(2) In accordance with section 408(a) 

of ERISA and section 4975(c)(2) of the 

Code, the Department makes the 

following determinations: The 

exemption is administratively feasible, 

the exemption is in the interests of the 

plan and of its participants and 

beneficiaries, and the exemption is 

protective of the rights of participants 

and beneficiaries of the plan; 

(3) The exemption is supplemental to, 

and not in derogation of, any other 

provisions of ERISA, including statutory 

or administrative exemptions and 

transitional rules. Furthermore, the fact 

that a transaction is subject to an 

administrative or statutory exemption is 

not dispositive of whether the 

transaction is in fact a prohibited 

transaction; and 

(4) The availability of this exemption 

is subject to the express condition that 

the material facts and representations 

contained in the application accurately 


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3For purposes of this exemption, references to 

section 406 of ERISA should be read to refer as well 

to the corresponding provisions of section 4975 of 

the Code. 

4 49 FR 9494 (March 13, 1984), as corrected at 50 

FR 41430 (October 10, 1985), as amended at 70 FR 

49305 (August 23, 2005), and as amended at 75 FR 

38837 (July 6, 2010). 

5Section I(g) generally provides that ‘‘[n]either 

the QPAM nor any affiliate thereof . . . nor any 

owner . . . of a 5 percent or more interest in the 

QPAM is a person who within the 10 years 

immediately preceding the transaction has been 

either convicted or released from imprisonment, 

whichever is later, as a result of’’ certain felonies 

including income tax evasion and conspiracy or 

attempt to commit income tax evasion. 

describe all material terms of the 

transaction which is the subject of the 

exemption. 

Accordingly, the following exemption 

is granted under the authority of section 

408(a) of ERISA and section 4975(c)(2) 

of the Code and in accordance with the 

procedures set forth in 29 CFR Part 

2570, Subpart B (76 FR 66637, 66644, 

October 27, 2011): 

Exemption 3

Section I: Covered Transactions 

The Credit Suisse Affiliated QPAMs 

and the Credit Suisse Related QPAMs 

shall not be precluded from relying on 

the relief provided by Prohibited 

Transaction Class Exemption (PTE) 84– 

14 4 notwithstanding the Conviction (as 

defined in Section II(c)),5 provided the 

following conditions are satisfied: 

(a) Any failure of the Credit Suisse 

Affiliated QPAMs or the Credit Suisse 

Related QPAMs to satisfy Section I(g) of 

PTE 84–14 arose solely from the 

Conviction; 

(b) The Credit Suisse Affiliated 

QPAMs and the Credit Suisse Related 

QPAMs (including officers, directors, 

agents other than Credit Suisse AG, and 

employees of such QPAMs) did not 

participate in the criminal conduct of 

Credit Suisse AG that is the subject of 

the Conviction; 

(c) The Credit Suisse Affiliated 

QPAMs and the Credit Suisse Related 

QPAMs did not directly receive 

compensation in connection with the 

criminal conduct of Credit Suisse AG 

that is the subject of the Conviction; 

(d) The criminal conduct of Credit 

Suisse AG that is the subject of the 

Conviction did not directly or indirectly 

involve the assets of any plan subject to 

Part 4 of Title I of ERISA (an ERISAcovered plan) or section 4975 of the 

Code (an IRA); 

(e) Credit Suisse AG did not provide 

any fiduciary services to ERISA-covered 

plans or IRAs, except in connection 

with securities lending services of the 

New York Branch of Credit Suisse AG, 

or act as a QPAM for ERISA-covered 

plans or IRAs; 

(f) A Credit Suisse Affiliated QPAM 

will not use its authority or influence to 

direct an ‘‘investment fund’’ (as defined 

in Section VI(b) of PTE 84–14) that is 

subject to ERISA and managed by such 

Credit Suisse Affiliated QPAM to enter 

into any transaction with Credit Suisse 

AG or engage Credit Suisse AG to 

provide additional services to such 

investment fund, for a direct or indirect 

fee borne by such investment fund 

regardless of whether such transactions 

or services may otherwise be within the 

scope of relief provided by an 

administrative or statutory exemption; 

(g) Each Credit Suisse Affiliated 

QPAM will ensure that none of its 

employees or agents, if any, that were 

involved in the criminal conduct that 

underlies the Conviction will engage in 

transactions on behalf of any 

‘‘investment fund’’ (as defined in 

Section VI(b) of PTE 84–14) subject to 

ERISA and managed by such Credit 

Suisse Affiliated QPAMs; 

(h)(1) Each Credit Suisse Affiliated 

QPAM immediately develops, 

implements, maintains, and follows 

written policies (the Policies) requiring 

and reasonably designed to ensure that: 

(i) The asset management decisions of 

the Credit Suisse Affiliated QPAMs are 

conducted independently of Credit 

Suisse AG’s management and business 

activities; (ii) the Credit Suisse 

Affiliated QPAM fully complies with 

ERISA’s fiduciary duties and ERISA and 

the Code’s prohibited transaction 

provisions and does not knowingly 

participate in any violations of these 

duties and provisions with respect to 

ERISA-covered plans and IRAs; (iii) the 

Credit Suisse Affiliated QPAM does not 

knowingly participate in any other 

person’s violation of ERISA or the Code 

with respect to ERISA-covered plans 

and IRAs; (iv) any filings or statements 

made by the Credit Suisse Affiliated 

QPAM to regulators, including but not 

limited to, the Department of Labor, the 

Department of the Treasury, the 

Department of Justice, and the Pension 

Benefit Guaranty Corporation, on behalf 

of ERISA-covered plans or IRAs are 

materially accurate and complete, to the 

best of such QPAM’s knowledge at that 

time; (v) the Credit Suisse Affiliated 

QPAM does not make material 

misrepresentations or omit material 

information in its communications with 

such regulators with respect to ERISAcovered plans or IRAs, or make material 

misrepresentations or omit material 

information in its communications with 

ERISA-covered plan and IRA clients; 

(vi) the Credit Suisse Affiliated QPAM 

complies with the terms of this 

exemption; and (vii) any violations of or 

failure to comply with items (ii) through 

(vi) are corrected promptly upon 

discovery and any such violations or 

compliance failures not promptly 

corrected are reported, upon discovering 

the failure to promptly correct, in 

writing to appropriate corporate officers, 

the head of Compliance and the General 

Counsel of the relevant Credit Suisse 

Affiliated QPAM, the independent 

auditor responsible for reviewing 

compliance with the Policies, and a 

fiduciary of any affected ERISA-covered 

plan or IRA where such fiduciary is 

independent of Credit Suisse AG; 

however, with respect to any ERISAcovered plan or IRA sponsored by an 

‘‘affiliate’’ (as defined in Section VI(d) of 

PTE 84–14) of Credit Suisse AG or 

beneficially owned by an employee of 

Credit Suisse AG or its affiliates, such 

fiduciary does not need to be 

independent of Credit Suisse AG; Credit 

Suisse Affiliated QPAMs will not be 

treated as having failed to develop, 

implement, maintain, or follow the 

Policies, provided that they correct any 

instances of noncompliance promptly 

when discovered or when they 

reasonably should have known of the 

noncompliance (whichever is earlier), 

and provided that they adhere to the 

reporting requirements set forth in this 

item (vii); 

(2) Each Credit Suisse Affiliated 

QPAM immediately develops and 

implements a program of training (the 

Training), conducted at least annually 

for relevant Credit Suisse Affiliated 

QPAM asset management, legal, 

compliance, and internal audit 

personnel; the Training shall be set forth 

in the Policies and, at a minimum, 

covers the Policies, ERISA and Code 

compliance (including applicable 

fiduciary duties and the prohibited 

transaction provisions) and ethical 

conduct, the consequences for not 

complying with the conditions of this 

exemption, (including the loss of the 

exemptive relief provided herein), and 

prompt reporting of wrongdoing; 

(i)(1) Each Credit Suisse Affiliated 

QPAM submits to an audit by an 

independent auditor, who has been 

prudently selected and who has 

appropriate technical training and 

proficiency with ERISA to evaluate the 

adequacy of, and compliance with, the 

Policies and Training required in 

paragraph (h); the audit requirement 

must be incorporated in the Policies and 

the first of the audits must be completed 

no later than ten (10) months after the 

date of Conviction. The audit must 

cover the first six-month period that 

begins on the date of Conviction; under 

the terms of the Policies, the second 

audit must cover the following 

corresponding six-month period and be 


tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 79, No. 222 / Tuesday, November 18, 2014 / Notices 68725 

completed no later than four (4) months 

after the period to which the audit 

applies; 

(2) The auditor’s engagement shall 

specifically require the auditor to 

determine whether each Credit Suisse 

Affiliated QPAM has developed, 

implemented, maintained, and followed 

Policies in accordance with the 

conditions of this exemption and 

developed and implemented the 

Training, as required herein; 

(3) The auditor’s engagement shall 

specifically require the auditor to test 

each Credit Suisse Affiliated QPAM’s 

operational compliance with the 

Policies and Training; 

(4) For each audit, the auditor shall 

issue a written report (the Audit Report) 

to Credit Suisse AG and the Credit 

Suisse Affiliated QPAM to which the 

audit applies that describes the steps 

performed by the auditor during the 

course of its examination. The Audit 

Report shall include the auditor’s 

specific determinations regarding the 

adequacy of the Policies and Training; 

the auditor’s recommendations (if any) 

with respect to strengthening such 

Policies and Training; and any instances 

of the respective Credit Suisse Affiliated 

QPAM’s noncompliance with the 

written Policies and Training described 

in paragraph (h) above. Any 

determinations made by the auditor 

regarding the adequacy of the Policies 

and Training and the auditor’s 

recommendations (if any) with respect 

to strengthening the Policies and 

Training of the respective Credit Suisse 

Affiliated QPAM shall be promptly 

addressed by such Credit Suisse 

Affiliated QPAM, and any actions taken 

by such Credit Suisse Affiliated QPAM 

to address such recommendations shall 

be included in an addendum to the 

Audit Report. Any determinations by 

the auditor that the respective Credit 

Suisse Affiliated QPAM has 

implemented, maintained, and followed 

sufficient Policies and Training shall 

not be based solely or in substantial part 

on an absence of evidence indicating 

noncompliance; 

(5) The auditor shall notify the 

respective Credit Suisse Affiliated 

QPAM of any instances of 

noncompliance identified by the auditor 

within five (5) business days after such 

noncompliance is identified by the 

auditor, regardless of whether the audit 

has been completed as of that date. 

Upon request, the auditor shall provide 

OED with all of the relevant workpapers 

reflecting any instances of 

noncompliance. The workpapers shall 

include an explanation of any corrective 

or remedial actions taken by the 

respective Credit Suisse Affiliated 

QPAM; 

(6) With respect to each Audit Report, 

an executive officer of the Credit Suisse 

Affiliated QPAM to which the Audit 

Report applies certifies in writing, 

under penalty of perjury, that the officer 

has reviewed the Audit Report and this 

exemption; addressed, corrected, or 

remediated any inadequacies identified 

in the Audit Report; and determined 

that the Policies and Training in effect 

at the time of signing are adequate to 

ensure compliance with the conditions 

of this exemption and with the 

applicable provisions of ERISA and the 

Code; 

(7) An executive officer of Credit 

Suisse AG reviews the Audit Report for 

each Credit Suisse Affiliated QPAM and 

certifies in writing, under penalty of 

perjury, that such officer has reviewed 

each Audit Report; 

(8) Each Credit Suisse Affiliated 

QPAM provides its certified Audit 

Report to the Department’s Office of 

Exemption Determinations (OED), Room 

N–5700, 200 Constitution Avenue NW., 

Washington, DC 20210, no later than 30 

days following its completion, and each 

Credit Suisse Affiliated QPAM makes its 

Audit Report unconditionally available 

for examination by any duly authorized 

employee or representative of the 

Department, other relevant regulators, 

and any fiduciary of an ERISA-covered 

plan or IRA, the assets of which are 

managed by such Credit Suisse 

Affiliated QPAM; 

(j) The Credit Suisse Affiliated 

QPAMs comply with each condition of 

PTE 84–14, as amended, with the sole 

exception of the violation of Section I(g) 

that is attributable to the Conviction; 

(k) Effective from the date of 

publication of this exemption in the 

Federal Register, with respect to each 

ERISA-covered plan or IRA for which a 

Credit Suisse Affiliated QPAM provides 

asset management or other discretionary 

fiduciary services, each Credit Suisse 

Affiliated QPAM agrees: (1) To comply 

with ERISA and the Code, as applicable 

to the particular ERISA-covered plan or 

IRA, and refrain from engaging in 

prohibited transactions; (2) not to waive, 

limit, or qualify the liability of the 

Credit Suisse Affiliated QPAM for 

violating ERISA or the Code or engaging 

in prohibited transactions; (3) not to 

require the ERISA-covered plan or IRA 

(or sponsor of such ERISA-covered plan 

or beneficial owner of such IRA) to 

indemnify the Credit Suisse Affiliated 

QPAM for violating ERISA or engaging 

in prohibited transactions, except for 

violations or prohibited transactions 

caused by an error, misrepresentation, 

or misconduct of a plan fiduciary or 

other party hired by the plan fiduciary 

who is independent of Credit Suisse 

AG; (4) not to restrict the ability of such 

ERISA-covered plan or IRA to terminate 

or withdraw from its arrangement with 

the Credit Suisse Affiliated QPAM; and 

(5) not to impose any fees, penalties, or 

charges for such termination or 

withdrawal with the exception of 

reasonable fees, appropriately disclosed 

in advance, that are specifically 

designed to prevent generally 

recognized abusive investment practices 

or specifically designed to ensure 

equitable treatment of all investors in a 

pooled fund in the event such 

withdrawal or termination may have 

adverse consequences for all other 

investors, provided that such fees are 

applied consistently and in like manner 

to all such investors. Within six (6) 

months of the date of publication of this 

exemption in the Federal Register, each 

Credit Suisse Affiliated QPAM will 

provide a notice to such effect to each 

ERISA-covered plan or IRA for which a 

Credit Suisse Affiliated QPAM provides 

asset management or other discretionary 

fiduciary services; 

(l) Effective from the date of 

publication of this exemption in the 

Federal Register, each Credit Suisse 

Affiliated QPAM will maintain records 

necessary to demonstrate that the 

conditions of this exemption have been 

met for six (6) years following the date 

of any transaction for which such Credit 

Suisse Affiliated QPAM relies upon the 

relief in the exemption; 

(m)(1) Each sponsor of an ERISAcovered plan and each beneficial owner 

of an IRA invested in an investment 

fund managed by a Credit Suisse 

Affiliated QPAM, or the sponsor of an 

investment fund in any case where a 

Credit Suisse Affiliated QPAM acts only 

as a sub-advisor to the investment fund; 

(2) each entity that may be a Credit 

Suisse Related QPAM; and (3) each 

ERISA-covered plan for which the New 

York Branch of Credit Suisse AG 

provides fiduciary securities lending 

services, received a notice of the 

proposed exemption along with a 

separate summary describing the facts 

that led to the Conviction, which had 

been submitted to the Department, and 

a prominently displayed statement that 

the Conviction results in a failure to 

meet a condition in PTE 84–14; 

(n) A Credit Suisse Affiliated QPAM 

will not fail to meet the terms of this 

exemption solely because a Credit 

Suisse Related QPAM or a different 

Credit Suisse Affiliated QPAM fails to 

satisfy a condition for relief under this 

exemption. A Credit Suisse Related 

QPAM will not fail to meet the terms of 

this exemption solely because Credit 


tkelley on DSK3SPTVN1PROD with NOTICES
68726 Federal Register / Vol. 79, No. 222 / Tuesday, November 18, 2014 / Notices 

6 In general terms, a QPAM is an independent 

fiduciary that is a bank, savings and loan 

association, insurance company, or investment 

adviser that meets certain equity or net worth 

requirements and other licensure requirements and 

that has acknowledged in a written management 

agreement that it is a fiduciary with respect to each 

plan that has retained the QPAM. 

Suisse AG, a Credit Suisse Affiliated 

QPAM, or a different Credit Suisse 

Related QPAM fails to satisfy a 

condition for relief under this 

exemption. 

Section II: Definitions 

(a) The term ‘‘Credit Suisse Affiliated 

QPAM’’ means a ‘‘qualified professional 

asset manager’’ (as defined in section 

VI(a) 6 of PTE 84–14) that relies on the 

relief provided by PTE 84–14 and with 

respect to which Credit Suisse AG is a 

current or future ‘‘affiliate’’ (as defined 

in section VI(d) of PTE 84–14). The term 

‘‘Credit Suisse Affiliated QPAM’’ 

excludes the parent entity, Credit Suisse 

AG. 

(b) The term ‘‘Credit Suisse Related 

QPAM’’ means any current or future 

‘‘qualified professional asset manager’’ 

(as defined in section VI(a) of PTE 84– 

14) that relies on the relief provided by 

PTE 84–14, and with respect to which 

Credit Suisse AG owns a direct or 

indirect five percent or more interest, 

but with respect to which Credit Suisse 

AG is not an ‘‘affiliate’’ (as defined in 

section VI(d) of PTE 84–14). 

(c) The term ‘‘Conviction’’ means the 

judgment of conviction against Credit 

Suisse AG for one count of conspiracy 

to violate section 7206(2) of the Internal 

Revenue Code in violation of Title 18, 

United States Code, Section 371, which 

is scheduled to be entered in the District 

Court for the Eastern District of Virginia 

in Case Number 1:14–cr–188–RBS. 

Effective Date: This exemption will be 

effective as of the date a judgment of 

conviction against Credit Suisse AG for 

one count of conspiracy to violate 

section 7206(2) of the Internal Revenue 

Code in violation of Title 18, United 

States Code, Section 371 is entered in 

the District Court for the Eastern District 

of Virginia in Case Number 1:14–cr– 

188–RBS and expire one year from the 

date of publication in the Federal 

Register. 

Signed at Washington, DC, this 12th day of 

November, 2014. 

Lyssa Hall, 

Director of Exemption Determinations, 

Employee Benefits Security Administration, 

U.S. Department of Labor. 

[FR Doc. 2014–27172 Filed 11–17–14; 8:45 am] 

BILLING CODE 4510–29–P 

OFFICE OF MANAGEMENT AND 

BUDGET 

Calendar Year 2014 Cost of Outpatient 

Medical, Dental, and Cosmetic Surgery 

Services Furnished by Department of 

Defense Medical Treatment Facilities; 

Certain Rates Regarding Recovery 

From Tortiously Liable Third Persons 

AGENCY: Office of Management and 

Budget, Executive Office of the 

President. 

ACTION: Notice. 

SUMMARY: By virtue of the authority 

vested in the President by section 2(a) 

of Public Law 87–603 (76 Stat. 593; 42 

U.S.C. 2652), and delegated to the 

Director of the Office of Management 

and Budget (OMB) by the President 

through Executive Order No. 11541 of 

July 1, 1970, the rates referenced below 

are hereby established. These rates are 

for use in connection with the recovery 

from tortiously liable third persons for 

the cost of outpatient medical, dental, 

and cosmetic surgery services furnished 

by military treatment facilities through 

the Department of Defense (DoD). The 

rates were established in accordance 

with the requirements of OMB Circular 

A–25, requiring reimbursement of the 

full cost of all services provided. The 

CY14 Outpatient Medical, Dental, and 

Cosmetic Surgery rates referenced are 

effective upon publication of this notice 

in the Federal Register and will remain 

in effect until further notice. Previously 

published inpatient rates remain in 

effect until further notice. Pharmacy 

rates are updated periodically. A full 

disclosure of the rates is posted at the 

DoD’s Uniform Business Office Web 

site: http://www.tricare.mil/ocfo/mcfs/

ubo/mhs_rates.cfm. 

Shaun Donovan, 

Director. 

[FR Doc. 2014–27208 Filed 11–17–14; 8:45 am] 

BILLING CODE 3110–01–P 

NATIONAL AERONAUTICS AND 

SPACE ADMINISTRATION 

[Notice 14–119] 

Final Environmental Impact Statement: 

Mars 2020 Mission 

AGENCY: National Aeronautics and 

Space Administration. 

ACTION: Notice of Availability (NOA) of 

the Final Environmental Impact 

Statement (FEIS) for implementation of 

the Mars 2020 Mission. 

SUMMARY: This Environmental Impact 

Statement (EIS) is a tiered document 

(Tier 2 EIS) under NASA’s 

Programmatic EIS for the Mars 

Exploration Program (MEP). The FEIS 

presents descriptions of the proposed 

Mars 2020 mission, spacecraft, and 

candidate launch vehicles; an overview 

of the affected environment at and near 

the launch site; and the potential 

environmental consequences associated 

with the Proposed Action and 

alternatives, including the No Action 

Alternative. 

DATES: NASA will issue a Record of 

Decision (ROD) for the proposed Mars 

2020 mission either by December 19, 

2014, or after 30 days from the date of 

publication of the NOA of the Mars 

2020 FEIS in the Federal Register of the 

U.S. Environmental Protection Agency 

(EPA) NOA of the Mars 2020 FEIS, 

whichever is later. 

ADDRESSES: The FEIS may be reviewed 

at the NASA Headquarters Library 

(Washington, DC), the Jet Propulsion 

Laboratory Visitors Lobby (Pasadena, 

CA), as well as public libraries in 

Florida including Central Brevard, 

Cocoa Beach, Merritt Island, Port St. 

John, Cape Canaveral and Titusville. 

Limited hard copies of the FEIS are 

available and may be requested by 

contacting Mr. George Tahu at the 

address, telephone number, or 

electronic mail address indicated below. 

The FEIS is available electronically to 

download and read at http://

www.nasa.gov/agency/nepa/

mars2020eis. NASA’s ROD will also be 

placed on this Web site when it is 

issued. Anyone who desires a hard copy 

of NASA’s ROD when it is issued 

should contact Mr. Tahu. 

FOR FURTHER INFORMATION CONTACT: Mr. 

George Tahu, Planetary Science 

Division, Science Mission Directorate, 

NASA Headquarters, Washington, DC 

20546–0001, telephone 202–358–0016, 

or electronic mail to mars2020-nepa@

lists.nasa.gov. 

SUPPLEMENTARY INFORMATION: Pursuant 

to the National Environmental Policy 

Act of 1969, as Amended, (NEPA) (42 

U.S.C. 4321 et seq.), the Council on 

Environmental Quality Regulations for 

Implementing the Procedural Provisions 

of NEPA (40 CFR Parts 1500–1508), and 

NASA NEPA regulations (14 CFR Part 

1216 subpart 1216.3), NASA has 

prepared and issued an FEIS for the 

proposed Mars 2020 mission. 

The purpose of this proposed mission 

is to continue NASA’s in-depth 

exploration of Mars by conducting 

comprehensive science on the surface of 

Mars. The mission would consist of a 

highly mobile science laboratory (rover) 

designed to explore and investigate in 


tkelley on DSK3SPTVN1PROD with NOTICES