ERISA Bond question

investment advisor who manages some assets on a discretionary basis and some assets on a non discretionary basis.  purchased an ERISA Bond as fiduciary who "handles assets" for the discretionary group of plans.  Subsequently it is determined the RIA has custody of all the plan assets it manages by virtue of its ability to authorize and initiate third party distributions and payments.  the question - is custody for this reason comparable to handling assets under ERISA?    

That an activity or power is custody under a Federal or State statute or rule that regulates an investment adviser does not by itself mean that the activity or power results in the person handling, in the meaning of ERISA § 412 [29 U.S.C. § 1112], an employee-benefit plan’s money or other property.

Rather, you’d consider all the facts and circumstances about what the investment adviser does, or has authority to do, and evaluate whether it results in “handling” for ERISA § 412.

Leaving aside questions about what legal effect the temporary bonding rules might have, at least one of them treats actual or apparent authority to transfer money, rights, or other property to “a third party” as handling that property.  29 C.F.R. § 2580.412-6(b)(3) https://www.ecfr.gov/cgi-bin/text-idx?SID=9ccdd2f6ed4def0e3fed2ceed96cb727&mc=true&node=se29.9.2580_1412_66&rgn=div8

If a person does not handle a plan’s assets but is the plan’s fiduciary (for example, because the investment adviser renders investment advice), ask for your lawyer’s advice about whether such a person might need fidelity-bond coverage no less than $1,000, even if the amount the fiduciary handles is zero.  ERISA § 412(a) provides: “The amount of such bond shall be fixed at the beginning of each fiscal year of the plan.  Such amount shall be not less than 10 per centum of the amount of funds handled.  In no case shall such bond be less than $1,000[.]”).  See also DoL-EBSA, Guidance Regarding ERISA Fidelity Bonding Requirements, Field Assistance Bulletin No. 2008-04 (Nov. 25, 2008), at Q 35 (“Generally, each plan official must be bonded in an amount equal to at least 10% of the amount of funds he or she handled in the preceding year.  The bond amount cannot, however, be less than $1,000[.]”).  https://www.dol.gov/sites/dolgov/files/ebsa/employers-and-advisers/guidance/field-assistance-bulletins/2008-04.pdf

Scuba 401, the question I always ask myself is, "If this person went to the dark side, could he or she take any funds and catch a flight to a South American country?" If so, they're definitely handling plan assets. It sounds like in this situation the person could, although I may have misread your facts.