ID: Office: UILC: CCA_2011012709442650 ------------------------- 4975.03-02 Number: 201108034 Release Date: 2/25/2011 From: -------------------- Sent: Thursday, January 27, 2011 9:44:30 AM To: ------------------------- Cc: Subject: Guaranteeing a Loan This is in response to your voice message. With respect to the issue concerning signing personall y as guarantors of a note, Congress stated in the ERI SA Conference Report that, “…a prohibited transaction generall y will occur if a loan to a plan is guaranteed by a part y-in-interest [disqualified person], unless it comes within the special exemption for employ ee stock ownership plans.” H.R. Rep. No. 1280, 93d Cong., 2d Sess., at 308 (1974). Consequently , a guarantee of a plan’s indebtedness by a fiduciary or other disqualified person is an extension of credit to the plan in violation of section 4975(c)(1)(B) of the Code. See the attached DOL Advisory Opinion 90-33A (July 3, 1990) and DOL Advisory Opinion 2009-03A (October 27, 2009).