367 
‘‘SEC. 257. TIER III INVESTMENT OPTIONS. 
‘‘(a) ELECTION
OF TIER III INVESTMENT OP-
TIONS.— 
‘‘(1) IN GENERAL.—A participating individual 
may elect to direct transfers from amounts in the 
Savings Fund credited to the personal social security 
savings account of such individual into 1 or more 
Tier III Investment Options in accordance with 
paragraph (2). 
‘‘(2) COMMENCEMENT OF TIER III INVESTMENT 
OPTIONS UPON ATTAINMENT OF ELECTION THRESH-
OLD.—In any case in which, as of the end of any 
calendar year, the total balance in the Savings Fund 
credited to a participating individual’s personal so-
cial security savings account exceeds for the first 
time the election threshold, the Board shall, by regu-
lation, provide for an opportunity for such partici-
pating individual to make, at any time thereafter, 
such individual’s first election of one or more of the 
Tier III Investment Options for investment of an 
amount in the Savings Fund credited to such ac-
count. Such election may be in lieu of or in addition 
to investment in the options available with respect to 
the Tier II Investment Fund of the Savings Fund. 
‘‘(3) ALLOCATION OF FUNDS.—In the case of 
an election under paragraph (1), funds credited to 
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the personal social security savings account of the 
participating individual and elected for transfer to 
one or more Tier III Investment Options shall be 
transferred to the Tier III Investment Options so 
elected for such calendar year, in percentages speci-
fied in the election by the participating individual for 
each applicable portfolio. 
‘‘(4) ELECTION THRESHOLD.— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), for purposes of this subsection the 
term ‘election threshold’ means an amount 
equal to $25,000. 
‘‘(B) ADJUSTMENTS.—The Board shall ad-
just annually (effective for annual reporting 
months occurring after December 2011) the 
dollar amount set forth in subparagraph (A) 
under procedures providing for adjustments in 
the same manner and to the same extent as ad-
justments are provided for under the proce-
dures used to adjust benefit amounts under sec-
tion 215(i)(2)(A), except that any amount so 
adjusted that is not a multiple of $1.00 shall be 
rounded to the nearest multiple of $1.00. 
‘‘(5) SUBSEQUENT INVESTMENT OF AMOUNTS 
HELD
IN
TIER
III
INVESTMENT
OPTIONS.—Any 
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amounts held in one or more Tier III Investment 
Options may be— 
‘‘(A) transferred at any time to one or 
more other Tier III Investment Options, subject 
to applicable regulations of the Board and the 
terms governing the affected Tier III Invest-
ment Options, and 
‘‘(B) transferred, not more frequently than 
annually, to the Tier II Investment Fund, for 
deposit in the applicable investment account 
then selected by the participating individual 
under section 256. 
‘‘(b) CERTIFICATION OF ELIGIBLE ENTITIES.— 
‘‘(1) IN GENERAL.—The Board shall certify eli-
gible entities to offer Tier III Investment Options 
under this part. 
‘‘(2) APPLICATION.—Any eligible entity that de-
sires to be certified by the Board to offer a Tier III 
Investment Option shall submit an application to the 
Board at such time, in such manner, and containing 
such information as the Board may require. 
‘‘(3) REQUIREMENTS
FOR
APPROVAL.—The 
Board shall not certify an eligible entity unless such 
eligible entity agrees to the following requirements: 
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‘‘(A) SEPARATE ACCOUNTING.—Each eligi-
ble entity shall, with respect to each Tier III 
Investment Option offered by such eligible enti-
ty to participating individuals— 
‘‘(i) establish separate accounts for 
the contributions of each participating in-
dividual, and any earnings properly allo-
cable to the contributions, and 
‘‘(ii) maintain separate recordkeeping 
with respect to each account. 
‘‘(B) TREATMENT OF AMOUNTS HELD IN 
FUND.—Amounts deposited into, and held and 
accounted for in, a Tier III Investment Option 
with respect to any participating individual 
shall be treated as property of such partici-
pating individual, held in trust for such partici-
pating individual. 
‘‘(C) TRUST
REQUIREMENTS.—Amounts 
held and accounted for with respect to a partici-
pating individual shall be held in a trust created 
or organized in the United States for the exclu-
sive benefit of such individual or his bene-
ficiaries. 
‘‘(D) EXEMPTION
FROM
THIRD
PARTY 
CLAIMS.—Each Tier III Investment Option 
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shall be exempt from any and all third party 
claims against the eligible entity. 
‘‘(E) DISCLOSURE
OF
ADMINISTRATIVE 
COSTS.—Each eligible entity offering a Tier III 
Investment Option under this section shall pro-
vide to each participating individual an annual 
disclosure of the rate of administrative costs 
chargeable with respect to investment in such 
Option. Such disclosure shall be written in a 
manner calculated to be understood by the av-
erage participating individual. The Board shall 
provide for coordination of disclosures with re-
spect to Tier III Investment Options under this 
subparagraph so as to assist participating indi-
viduals in comparing alternative Options based 
on administrative costs. 
‘‘(F) REPORTING TO THE EXECUTIVE DI-
RECTOR AND THE BOARD.—Each eligible entity 
shall provide reports to the Executive Director 
and the Board at such time, in such manner, 
and containing such information as the Board 
may require. 
‘‘(4) ELIGIBLE
ENTITY
DEFINED.—For pur-
poses of this section, the term ‘eligible entity’ means 
any investment company (as defined in section 3 of 
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the Investment Company Act of 1940) or other per-
son that the Board determines appropriate to offer 
Tier III Investment Options under this part. 
‘‘(c) APPROVAL
OF TIER III INVESTMENT OP-
TIONS.— 
‘‘(1) IN GENERAL.—No funds may be trans-
ferred into a Tier III Investment Option unless the 
Board has approved an application submitted under 
paragraph (2) with respect to the option. 
‘‘(2) APPLICATION.—With respect to each Tier 
III Investment Option that an eligible entity cer-
tified under subsection (b)(1) seeks to offer, such 
entity shall submit an application to the Board at 
such time, in such manner, and containing such in-
formation as the Board may require. 
‘‘(3) QUALIFICATIONS
FOR
APPROVAL.—The 
Board may not approve an application submitted 
under paragraph (2) in connection with a Tier III 
Investment Option unless the following requirements 
are met: 
‘‘(A) OPTION MUST BE OFFERED BY CER-
TIFIED
ELIGIBLE
ENTITY.—The Tier III In-
vestment Option is offered by an eligible entity 
certified under subsection (b). 
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