(1) It is unlawful for any custodian of a local government investment pool trust fund to: (a) Maintain the primary records of the assets of the trust fund anywhere but within the state of Colorado; (b) Act as a trustee, administrator, or investment adviser of the trust fund, except that a financial institution, or any person employed by or directly associated with a financial institution, acting as a custodian for a trust fund is not prohibited from also acting as administrator or in any advisory capacity for such trust fund; (c) Effect any transaction to relinquish possession of, distribute, expend, or transfer any of the assets of the trust fund without the prior written authorization of the board, except for: (I) The purchase or sale of authorized investments or the exchange of such assets for other assets of equal or greater value provided that such sale, purchase, or exchange is solely in the accounts of the trust fund; (II) Distributions to participating local governments; or (III) The payment of routine fees and expenses that have been authorized by the board of trustees in the annual budget of the trust fund; or (d) Execute any transaction with any of the assets of the trust fund without the written instruction of the investment adviser or a financial institution acting in an advisory capacity. (2) The custodian shall reconcile the accounts of a trust fund on a daily basis.
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