
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 5USC8478]

 
             TITLE 5--GOVERNMENT ORGANIZATION AND EMPLOYEES
 
                           PART III--EMPLOYEES
 
                   Subpart G--Insurance and Annuities
 
            CHAPTER 84--FEDERAL EMPLOYEES' RETIREMENT SYSTEM
 
 SUBCHAPTER VII--FEDERAL RETIREMENT THRIFT INVESTMENT MANAGEMENT SYSTEM
 
Sec. 8478. Bonding

    (a)(1) Except as provided in paragraph (2), each fiduciary and each 
person who handles funds or property of the Thrift Savings Fund shall be 
bonded as provided in this section.
    (2)(A) Bond shall not be required of a fiduciary (or of any officer 
or employee of such fiduciary) if such fiduciary--
        (i) is a corporation organized and doing business under the laws 
    of the United States or of any State;
        (ii) is authorized under such laws to exercise trust powers or 
    to conduct an insurance business;
        (iii) is subject to supervision or examination by Federal or 
    State authority; and
        (iv) has at all times a combined capital and surplus in excess 
    of such minimum amount (not less than $1,000,000) as the Secretary 
    of Labor prescribes in regulations.

    (B) If--
        (i) a bank or other financial institution would, but for this 
    subparagraph, not be required to be bonded under this section by 
    reason of the application of the exception provided in subparagraph 
    (A),
        (ii) the bank or financial institution is authorized to exercise 
    trust powers, and
        (iii) the deposits of the bank or financial institution are not 
    insured by the Federal Deposit Insurance Corporation,

such exception shall apply to such bank or financial institution only if 
the bank or institution meets bonding requirements under State law which 
the Secretary of Labor determines are at least equivalent to those 
imposed on banks by Federal law.
    (b)(1) The Secretary of Labor shall prescribe the amount of a bond 
under this section at the beginning of each fiscal year. Except as 
otherwise provided in this paragraph, such amount shall not be less than 
10 percent of the amount of funds handled. In no case shall such bond be 
less than $1,000 nor more than $500,000, except that the Secretary of 
Labor, after due notice and opportunity for hearing to all interested 
parties, and other consideration of the record, may prescribe an amount 
in excess of $500,000.
    (2) For the purpose of prescribing the amount of a bond under 
paragraph (1), the amount of funds handled shall be determined by 
reference to the amount of the funds handled by the person, group, or 
class to be covered by such bond or by their predecessor or 
predecessors, if any, during the preceding fiscal year, or to the amount 
of funds to be handled during the current fiscal year by such person, 
group, or class, estimated as provided in regulations prescribed by the 
Secretary of Labor.
    (c) A bond required by subsection (a)--
        (1) shall include such terms and conditions as the Secretary of 
    Labor considers necessary to protect the Thrift Savings Fund against 
    loss by reason of acts of fraud or dishonesty on the part of the 
    bonded person directly or through connivance with others;
        (2) shall have as surety thereon a corporate surety company 
    which is an acceptable surety on Federal bonds under authority 
    granted by the Secretary of the Treasury pursuant to sections 9304 
    through 9308 of title 31; and
        (3) shall be in a form or of a type approved by the Secretary of 
    Labor, including individual bonds or schedule or blanket forms of 
    bonds which cover a group or class.

    (d)(1) It shall be unlawful for any person to whom subsection (a) 
applies, to receive, handle, disburse, or otherwise exercise custody or 
control of any of the funds or other property of the Thrift Savings Fund 
without being bonded as required by this section.
    (2) It shall be unlawful for any fiduciary, or any other person 
having authority to direct the performance of functions described in 
paragraph (1), to permit any such function to be performed by any person 
to whom subsection (a) applies unless such person has met the 
requirements of such subsection.
    (e) Notwithstanding any other provision of law, any person who is 
required to be bonded as provided in subsection (a) shall be exempt from 
any other provision of law which would, but for this subsection, require 
such person to be bonded for the handling of the funds or other property 
of the Thrift Savings Fund.
    (f) The Secretary of Labor shall prescribe such regulations as may 
be necessary to carry out the provisions of this section, including 
exempting a person or class of persons from the requirements of this 
section.

(Added Pub. L. 99-335, title I, Sec. 101(a), June 6, 1986, 100 Stat. 
586; amended Pub. L. 99-556, title I, Secs. 108, 115, Oct. 27, 1986, 100 
Stat. 3132, 3134; Pub. L. 102-378, Sec. 2(72), Oct. 2, 1992, 106 Stat. 
1355.)


                               Amendments

    1992--Subsec. (a)(2)(B)(iii). Pub. L. 102-378 struck out 
``Corporation or the Federal Savings and Loan Insurance'' before 
``Corporation''.
    1986--Subsec. (a)(1). Pub. L. 99-556, Sec. 108, struck out ``(other 
than a member of the Employee Thrift Advisory Council with respect to 
his duties as a member)'' after ``each fiduciary''.
    Subsec. (c)(2). Pub. L. 99-556, Sec. 115, substituted ``sections 
9304 through 9308 of title 31'' for ``sections 6 through 13 of title 
6''.


                       Interim Bonding Regulations

    Section 113 of Pub. L. 99-556 provided that:
    ``(a) In General.--Subject to subsection (b), until such time as the 
Secretary of Labor promulgates final regulations under section 8478 of 
title 5, United States Code, the Secretary of Labor may, with respect to 
the Thrift Savings Fund, apply the temporary regulations under section 
412 of the Employee Retirement Income Security Act of 1974 [29 U.S.C. 
1112] that are set forth in section 2550.412-1, and subchapter I of 
chapter XXV, of title 29 of the Code of Federal Regulations, as in 
effect on September 23, 1986.
    ``(b) Termination of Interim Authority.--The authority to apply the 
temporary regulations referred to in subsection (a) with respect to the 
Thrift Savings Fund shall expire not later than December 31, 1989.''

                  Section Referred to in Other Sections

    This section is referred to in section 8478a of this title.
