‘‘(A) a bank, as defined in section
202(a)(2) of the Investment Advisers Act of
1940 (15 U.S.C. 80b–2(a)(2)) which—
‘‘(i) has the power to manage, ac-
quire, or dispose of assets of a plan;
‘‘(ii) has, as of the last day of its lat-
est fiscal year ending before the date of a
determination for the purpose of this sub-
paragraph, equity capital in excess of
$10,000,000; and
‘‘(iii) has, on the last day of its latest
fiscal year ending before the date of a de-
termination for the purpose of this sub-
paragraph, total client assets under its dis-
cretionary management and control for in-
vestment in excess of $100,000,000;
‘‘(B) a savings association, the accounts of
which are insured by the Federal Deposit In-
surance Corporation, which—
‘‘(i) has applied for and been granted
trust powers to manage, acquire, or dis-
pose of assets of a plan by a State or Gov-
ernment authority having supervision over
savings associations;
‘‘(ii) has, as of the last day of its lat-
est fiscal year ending before the date of a
determination for the purpose of this sub-
paragraph, equity capital or net worth in
excess of $10,000,000; and
‘‘(iii) has, on the last day of its latest
fiscal year ending before the date of a de-
termination for the purpose of this sub-
paragraph, total client assets under its dis-
cretionary management and control for in-
vestment in excess of $100,000,000;
‘‘(C) an insurance company which—
‘‘(i) is qualified under the laws of
more than one State to manage, acquire,
or dispose of any assets of a plan;
‘‘(ii) has, as of the last day of its lat-
est fiscal year ending before the date of a
determination for the purpose of this sub-
paragraph, 
net 
worth 
in 
excess 
of
$10,000,000;
‘‘(iii) is subject to supervision and ex-
amination by a State authority having su-
pervision over insurance companies; and
‘‘(iv) has, on the last day of its latest
fiscal year ending before the date of a de-
termination for the purpose of this sub-
paragraph, total client assets under its dis-
cretionary management and control for in-
vestment in excess of $100,000,000; or
‘‘(D) an investment adviser registered
under section 203 of the Investment Advisers
Act of 1940 (15 U.S.C. 80b–3) if the invest-
ment adviser has, on the last day of its latest
fiscal year ending before the date of a deter-
mination for the purpose of this subparagraph,
total client assets under its discretionary man-
agement and control for investment in excess of
$100,000,000, and—
‘‘(i) the investment adviser has, on
such day, shareholder’s or partner’s equity
in excess of $10,000,000; or
‘‘(ii) payment of all of the investment
adviser’s liabilities, including any liabilities
which may arise by reason of a breach or
violation of a duty described in section
254, is unconditionally guaranteed by—
‘‘(I) a person who directly or in-
directly, through one or more inter-
mediaries, controls, is controlled by,
or is under common control with the
investment adviser and who has, on
the last day of the person’s latest fis-
cal year ending before the date of a
determination for the purpose of this
subparagraph, shareholder’s or part-
ner’s equity in an amount which,
when added to the amount of the
shareholder’s or partner’s equity of
the investment adviser on such day,
exceeds $10,000,000;
‘‘(II) a qualified professional
asset manager described in paragraph
(1), (2), or (3); or
‘‘(III) a broker or dealer reg-
istered under section 15 of the Securi-
ties Exchange Act of 1934 (15 U.S.C.
78o) that has, on the last day of the
broker’s or dealer’s latest fiscal year
ending before the date of a determina-
tion for the purpose of this subpara-
graph, 
net 
worth 
in 
excess 
of
$10,000,000.
For purposes of subparagraph (D), the term ‘share-
holder’s or partner’s equity’, when used with respect
to an investment adviser, or a person who is affili-
ated with the investment adviser in a manner de-
scribed in clause (ii)(I) of subparagraph (D), means
the equity shown in the most recent balance sheet
prepared for such investment adviser or affiliated
person, in accordance with generally accepted ac-
counting principles, within 2 years before the date
on which the investment adviser’s status as a quali-
fied professional asset manager is determined for the
purposes of this section.
‘‘ENGAGEMENT OF QUALIFIED PUBLIC ACCOUNTANT
‘‘SEC. 253. (a) IN GENERAL.—The Social Security
Investment Board shall annually engage, on behalf of the
Social Security Investment Fund, an independent quali-
fied public accountant, who shall conduct an examination
of all accounts and other books and records maintained
in the administration of this part (including all applicable
financial statements) as the public accountant considers
necessary to enable the public accountant to make the de-
termination required by subsection (b). The examination
shall be conducted in accordance with generally accepted
auditing standards and shall involve such tests of the ac-
counts, books, and records as the public accountant con-
siders necessary.
‘‘(b) EXAMINATION AND REPORT.—The public ac-
countant conducting an examination under subsection (a)
shall determine whether the accounts, books, and records
hereby made available to the Secretary of Labor, and any
officer designated by the Secretary of Labor, to determine
whether any person has violated, or is about to violate,
any provision applicable under subsection (a).
‘‘(c) EXCULPATORY PROVISIONS; INSURANCE.—
‘‘(1) IN GENERAL.—Any provision in an agree-
ment or instrument which purports to relieve a fidu-
ciary from responsibility or liability for any respon-
sibility, obligation, or duty under this part shall be
void.
‘‘(2) INSURANCE.—Amounts in the Social Secu-
rity Investment Fund available for administrative
expenses shall be available and may be used at the
discretion of the Social Security Investment Board
to purchase insurance to cover potential liability of
persons who serve in a fiduciary capacity with re-
spect to amounts maintained in the Common Stock
Index Fund of the Social Security Investment Fund,
without regard to whether a policy of insurance per-
mits recourse by the insurer against the fiduciary in
the case of a breach of a fiduciary obligation.
‘‘DIVERSIFICATION THROUGH INVESTMENT MANAGEMENT
‘‘SEC. 255. The Social Security Investment Board
shall prescribe policies governing investment of the Social
Security Investment Fund which shall ensure—
‘‘(1) that the management of investments on
behalf of the Fund undertaken in the course of car-
rying out the investment responsibilities of the Exec-
utive Director of the Fund is exercised by qualified
professional asset managers pursuant to section 252
in such manner as to ensure that not fewer than 3
such managers are each engaged in the management
of a substantial portion of such investments,
‘‘(2) that investments managed on behalf of the
Fund by any such qualified professional asset man-
ager do not represent more than 1 percent of the
total equity interest in any person, and
‘‘(3) that each investment manager will vote on
any matter the shares of any issuer held by the
Fund under the management of such investment
manager in conformity with the voting on such mat-
ter of all other shares of such issuer.’’.
(b) CONFORMING AMENDMENT.—Section 201(d) of
such Act (42 U.S.C. 401(d)) is amended in the first sen-
tence by striking ‘‘withdrawals’’ and inserting ‘‘withdraw-
als, or, in the case of the Federal Old-Age and Survivors
Insurance Trust Fund, to meet the transfer requirements
under section 251(b)’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply with respect to fiscal years begin-
ning on or after October 1, 2000.
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