§ 11.5-39. Prohibited transactions.

(a)

The following transactions are expressly prohibited:

(1)

Any transactions not authorized by this policy.

(2)

The purchase of securities on margin.

(3)

Direct purchases of single-family or commercial mortgages.

(4)

Purchases of foreign bonds.

(5)

The short sale of securities.

(6)

Effective August 15, 1995, as provided in R.S. 33:2955(A)(1)(b)(iii), enacted by Act No. 1126 of 1995, investment in obligations issued or guaranteed by federal agencies or U.S. government instrumentalities which are collateralized mortgage obligations that have been stripped into interest only or principal only obligations, inverse floaters, or structured notes. "Structured note" means securities of U.S. government agencies, instrumentalities, or government-sponsored enterprises which have been restructured, modified, and/or reissued by private entities.

(b)

Any investments which were made prior to August 15, 1995, and which are now prohibited investments shall be monitored on a monthly basis by the town clerk or mayor and disposed of by the town when, upon recommendation of the town clerk or mayor after review of the solvency of the funds and the investment climate, it is prudent to do so.

(Ord. No. 1996-4, 6-11-96)