South Carolina Code 11-5-430. Program managers; management contracts; exchange of data authorized
(1) financial stability and integrity of the program manager;
Terms Used In South Carolina Code 11-5-430
- account: means an individual savings account established in accordance with the provisions of this article and pursuant to Section 529A of the federal Internal Revenue Code of 1986, as amended. See South Carolina Code 11-5-410
- Account owner: means the person who enters into a Palmetto ABLE account agreement pursuant to the provisions of this article. See South Carolina Code 11-5-410
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Contract: A legal written agreement that becomes binding when signed.
- Financial organization: means an organization authorized to do business in this State and is:
(a) licensed or chartered by the Director of Insurance;
(b) licensed or chartered by the State Commissioner of Banking;
(c) chartered by an agency of the federal government; or
(d) subject to the jurisdiction and regulation of the federal Securities and Exchange Commission. See South Carolina Code 11-5-410 - Management contract: means a contract executed by the State Treasurer and a program manager selected to act as a depository or manager of the program, or both. See South Carolina Code 11-5-410
- Program: means the Palmetto ABLE Savings Program established pursuant to this article. See South Carolina Code 11-5-410
- Program manager: means a financial organization or an agency or department of another state that has been designated to administer a qualified ABLE Program selected by the State Treasurer to act as a depository or manager of the program, or both. See South Carolina Code 11-5-410
(2) the safety of the investment instrument being offered;
(3) the ability of the program manager to satisfy recordkeeping and reporting requirements;
(4) the program manager’s plan for promoting the program and the investment the organization is willing to make to promote the program;
(5) the fees, if any, proposed to be charged to the account owners;
(6) the minimum initial deposit and minimum contributions that the financial organization requires;
(7) the ability of the program manager to accept electronic withdrawals, including payroll deduction plans; and
(8) other benefits to the State or its residents included in the proposal, including fees payable to the State to cover expenses of the operation of the program.
(B) The State Treasurer may enter into contracts with program managers necessary to effectuate the provisions of this article. A management contract must include, at a minimum, terms requiring the program managers to:
(1) take action required to keep the program in compliance with requirements of this article and take actions not contrary to its contract to manage the program to qualify as a "qualified ABLE Program" as defined in Section 529A of the federal Internal Revenue Code of 1986, as amended;
(2) keep adequate records of each account, keep each account segregated, and provide the State Treasurer with the information necessary to prepare the statements required by § 11-5-440;
(3) compile and total information contained in statements required to be prepared under § 11-5-440 and provide compilations to the State Treasurer;
(4) if there is more than one program manager, provide the State Treasurer with information as is necessary to determine compliance with § 11-5-440;
(5) provide the State Treasurer with access to the books and records of the program manager to the extent needed to determine compliance with the contract, this article, and Section 529A of the federal Internal Revenue Code of 1986, as amended;
(6) hold all accounts for the benefit of the account owner, owners, or the designated beneficiary;
(7) be audited at least annually by a firm of certified public accountants selected by the program manager, with the approval of the State Treasurer, and provide the results of the audit to the State Treasurer;
(8) provide the State Treasurer with copies of all regulatory filings and reports made by the program manager during the term of the management contract or while the program manager is holding any accounts, other than confidential filings or reports that are not part of the program. The program manager shall make available for review by the State Treasurer the results of the periodic examination of the manager by any state or federal banking, insurance, or securities commission, except to the extent that a report or reports may not be disclosed under law; and
(9) ensure that any description of the program, whether in writing or through the use of any media, is consistent with the marketing plan developed pursuant to the provisions of this article.
(C) The State Treasurer may:
(1) enter into contracts as he considers necessary and proper for the implementation of the program;
(2) require that an audit be conducted of the operations and financial position of the program depository and manager at any time if the State Treasurer has any reason to be concerned about the financial position, the recordkeeping practices, or the status of accounts of the program depository and manager; and
(3) terminate or not renew a management agreement. If the State Treasurer terminates or does not renew a management agreement, the State Treasurer shall take custody of accounts held by the program manager and shall seek to promptly transfer the accounts to another financial organization that is selected as a program manager or depository and into investment instruments as similar to the original instruments as possible.
(D) The State Treasurer, the Department of Social Services, the Department of Health and Human Services, and the Department of Disability and Special Needs are authorized to exchange data regarding eligible individuals to carry out the purposes of this article.