"Insider" Under Securities Exchange Act

[kgr12]

I think I know the answer to this, but just want to make sure I'm not missing something. Section III.G of Notice 2008-113 states that, in short, an "insider" is a director or officer of the service recipient or owns more than 10% of the service recipient as determined under the Securities Exchange Act of 1934. Additionally, for purposes of the Notice, it is determined "without regard to whether the service recipient has any class of equity securities registered under § 12 of such Act."

Seems pretty straightforward to me that this last provision is meant to cover as insiders those who aren't in publicly traded companies (and therefore making certain corrections under the Notice unavailable due to an insider being involved). I'm working with a nongovernmental tax exempt entity on a failure to make a timely payment under a 457(f) plan in 2023 to a C-Suite executive.  The executive is an officer and therefore certainly looks like an insider even though the entity could not under any circumstances have registered securities, and in fact has no ownership at all.

Any way to get around the idea that this executive is an insider for purposes of Notice 2008-113?

[XTitan]

Probably not.

[Peter Gulia]

The Notice points to a rule about the meaning of “officer”.

17 C.F.R. § 240.16a-1(f) https://www.ecfr.gov/current/title-17/part-240/section-240.16a-1#p-240.16a-1(f).