SEC Division of Investment Management staff letter: Missouri Family Trust Fund

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SEP 2G 1992
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RESPONSE OF THE OFFICE OF CHIEF COUNSEL DIVISION OF INVESTMENT MANAGEMENT Our Ref. No. 92-415-CC Missouri Family Trust Fund File No. 132-3 By letters dated July 24, 1991, and July 20, August 3, and August 13, 1992, you seek our assurance that we would not recommend that the Commission take enforcement action if (1) the Missouri Family Trust Fund (the "Trust") does not register under the Investment Company Act of 1940 (the "1940 Act"), in reliance on Section 2(b) of the 1940 Act; and (2) neither the Trustees of the Trust (the "Board") nor the Trust representatives who sell trust accounts (the "Representatives") register under the Investment Advisers Act of 1940 (the "Advisers Act"), in reliance on section 202 (b) of the Advisers Act. 11 The Trust was created directly by statute adopted by the Missouri legislature in 1989, and amended in 1991 (the "Statute"), which declared the Trust "an instrum-entality of the State. II Y The Trust's Board consists of nine members appointed by the Governor with the advice and consent of the State Senate. The Board is required to report annually to the Governor and to both State legislative houses. The Trust is exempt from federal taxation by virtue of an IRS ruling dated May 7, 1992, and from state taxation by provision of the Statute. d/ The Trust provides a vehicle through which private donors can make contributions to provide financial assistance to a designated individual with a mental or physical impairment (the "Beneficiary"). All Trust contributions are administered together, but a separate account is established for each 11 Section 2 (b) and Section 202 (b) respectively provide that the 1940 Act and the Advisers Act do not apply to the United States, a State, or any political subdivision of a State, or any agency, authority or instrumentality of anyone or more of the foregoing, and to any officer, agent or employee of the foregoing acting in the course of his official duty. Y See Mo. Rev. Stat. §§402.200 through 402.225 (Supp. 1992). d/ Your 1991 letter also describes a successor trust, which receives the original contribution made on behalf of a Beneficiary after the Beneficiary no longer participates in the Trust, and a charitable trust, which receives the unused income from a contribution in the event that the donor revokes a contribution. You request our advice only with respect to the status of the Trust under the 1940 Act. We therefore express no opinion as to any issues concerning the successor or charitable trusts.