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4975(c)(1)(D) issue, and we limit our discussion to section
4975(c)(1)(E).
Under section 4975(c)(1)(E), a disqualified person engages
in a prohibited transaction when, as a fiduciary, he or she
"deals with the income or assets of a plan in his [or her] own
interest or for his [or her] own account". The regulations
provide that "A fiduciary does not engage in an act described in
section 4975(c)(1)(E) if the fiduciary does not use any of the
authority, control or responsibility which makes such person a
fiduciary to cause a plan to [perform the act in question]".
Sec. 54.4975-6(a)(5)(ii), Qualified Pension Plan Excise Tax Regs.
A fiduciary does not "[deal] with * * * assets of a plan in his
[or her] own interest" when he or she absents himself or herself
from all consideration of the investment proposal and the
trustees make an independent investment decision. See sec.
54.4975-6(a)(6), Example (7), Qualified Pension Plan Excise Tax
Regs.
The policy behind the enactment of section 4975 was to tax
fiduciaries who engage in self-dealing rather than "innocent
employees." S. Rept. 93-383, at 95 (1974), 1974-3 C.B. (Supp.)
80, 174. Before the enactment of section 4975, prohibited
transactions would lead to the disqualification of a pension
plan. Id. at 94, 1974-3 C.B. (Supp.) at 173. This
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