103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB3043

 

Introduced 2/2/2024, by Sen. Don Harmon

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/1-110  from Ch. 108 1/2, par. 1-110

    Amends the Illinois Pension Code. Makes a technical change in a Section concerning prohibited transactions.


LRB103 37344 RPS 67465 b

 

 

A BILL FOR

 

SB3043LRB103 37344 RPS 67465 b

1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by
5changing Section 1-110 as follows:
 
6    (40 ILCS 5/1-110)  (from Ch. 108 1/2, par. 1-110)
7    Sec. 1-110. Prohibited Transactions.
8    (a) A fiduciary with respect to a retirement system,
9pension fund, or investment board shall not cause the the
10retirement system or pension fund to engage in a transaction
11if he or she knows or should know that such transaction
12constitutes a direct or indirect:
13        (1) Sale or exchange, or leasing of any property from
14    the retirement system or pension fund to a party in
15    interest for less than adequate consideration, or from a
16    party in interest to a retirement system or pension fund
17    for more than adequate consideration.
18        (2) Lending of money or other extension of credit from
19    the retirement system or pension fund to a party in
20    interest without the receipt of adequate security and a
21    reasonable rate of interest, or from a party in interest
22    to a retirement system or pension fund with the provision
23    of excessive security or an unreasonably high rate of

 

 

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1    interest.
2        (3) Furnishing of goods, services or facilities from
3    the retirement system or pension fund to a party in
4    interest for less than adequate consideration, or from a
5    party in interest to a retirement system or pension fund
6    for more than adequate consideration.
7        (4) Transfer to, or use by or for the benefit of, a
8    party in interest of any assets of a retirement system or
9    pension fund for less than adequate consideration.
10    (b) A fiduciary with respect to a retirement system or
11pension fund established under this Code shall not:
12        (1) Deal with the assets of the retirement system or
13    pension fund in his own interest or for his own account;
14        (2) In his individual or any other capacity act in any
15    transaction involving the retirement system or pension
16    fund on behalf of a party whose interests are adverse to
17    the interests of the retirement system or pension fund or
18    the interests of its participants or beneficiaries; or
19        (3) Receive any consideration for his own personal
20    account from any party dealing with the retirement system
21    or pension fund in connection with a transaction involving
22    the assets of the retirement system or pension fund.
23    (c) Nothing in this Section shall be construed to prohibit
24any trustee from:
25        (1) Receiving any benefit to which he may be entitled
26    as a participant or beneficiary in the retirement system

 

 

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1    or pension fund.
2        (2) Receiving any reimbursement of expenses properly
3    and actually incurred in the performance of his duties
4    with the retirement system or pension fund.
5        (3) Serving as a trustee in addition to being an
6    officer, employee, agent or other representative of a
7    party in interest.
8    (d) A fiduciary of a pension fund established under
9Article 3 or 4 shall not knowingly cause or advise the pension
10fund to engage in an investment transaction when the fiduciary
11(i) has any direct interest in the income, gains, or profits of
12the investment adviser through which the investment
13transaction is made or (ii) has a business relationship with
14that investment adviser that would result in a pecuniary
15benefit to the fiduciary as a result of the investment
16transaction.
17    Violation of this subsection (d) is a Class 4 felony.
18    (e) A board member, employee, or consultant with respect
19to a retirement system, pension fund, or investment board
20subject to this Code, except those whose investments are
21restricted by Section 1-113.2, shall not knowingly cause or
22advise the retirement system, pension fund, or investment
23board to engage in an investment transaction with an
24investment adviser when the board member, employee,
25consultant, or their spouse (i) has any direct interest in the
26income, gains, or profits of the investment adviser through

 

 

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1which the investment transaction is made or (ii) has a
2relationship with that investment adviser that would result in
3a pecuniary benefit to the board member, employee, or
4consultant or spouse of such board member, employee, or
5consultant as a result of the investment transaction. For
6purposes of this subsection (e), a consultant includes an
7employee or agent of a consulting firm who has greater than
87.5% ownership of the consulting firm.
9    Violation of this subsection (e) is a Class 4 felony.
10(Source: P.A. 95-950, eff. 8-29-08; 96-6, eff. 4-3-09.)