Prohibited Transactions defined in ERISA Section 406(a)

Section 406(a) states that a plan fiduciary may not engage the plan in an activity or transaction if he or she knows, or should know that the action directly or indirectly involves the:

  • Sale, exchange, or lease of any property between the plan and a party in interest

  • Lending of money or extending of credit between the plan and a party in interest

  • Furnishing of goods, services, or facilities between the plan and a party in interest

  • Transfer of a plan asset to a party in interest

  • Use of assets by, or for the benefit of, a party in interest

  • The acquisition or holding on behalf of the plan of any employer security or employer real property in excess of ERISA Section 407 limits