Help in finding a private letter ruling or individual PTE re:participant loans

[Guest BrianF]

I am assisting another employee in researching a prohibited transaction exemption. He believes the exemption was in the form of a private letter ruling as opposed to an individual PTE, but he is not sure. Here is the information on the case:

A participant received a loan from a qualified plan and subsequently gave the money to the employer. The issue at hand was if there was an indirect lending of money between the plan and a disqualified person. The IRS or DOL determined that it was not a prohibited transaction since the participant could do whatever he wants with the money.

Supposedly, this guidance was issued in the last two to three years. If you recall any specific information in regards to this guidance, please reply.

Your help is greatly appreciated. Thanks in advance.

Brian