If a Plan uses a bank as a directed trustee or custodian, my read has always been that although the bank does not have to be bonded (presuming it meets the other requirements of the ERISA 412 regs) the person or persons who give "direction" regarding investments must be bonded. Does anyone have a different read?

Every fiduciary must be bonded. That is: anyone who has any control over the plan assets, handles funds or other property of the plan.

pdahlen:

How do you square your answer with the terms of ERISA Section 412(a)(2)?

Sorry, didn't mean to mislead. I agree with KJohnson. Bank trustee does not require bonding but all others handling funds (not employed by the bank) do.