[Title 31 CFR ]
[Code of Federal Regulations (annual edition) - July 1, 2000 Edition]
[From the U.S. Government Printing Office]



[[Page i]]

          

                    31


          Parts 0 to 199

                         Revised as of July 1, 2000

Money and Finance: Treasury





          Containing A Codification of documents of general 
          applicability and future effect
          As of July 1, 2000
          With Ancillaries
          Published by
          Office of the Federal Register
          National Archives and Records
          Administration

As a Special Edition of the Federal Register



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                     U.S. GOVERNMENT PRINTING OFFICE
                            WASHINGTON : 2000



               For sale by U.S. Government Printing Office
 Superintendent of Documents, Mail Stop: SSOP, Washington, DC 20402-9328



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                            Table of Contents



                                                                    Page
  Explanation.................................................       v

  Title 31:
          Subtitle A--Office of the Secretary of the Treasury        3
    Subtitle B--Regulations Relating to Money and Finance:
          Chapter I--Monetary Offices, Department of the 
          Treasury                                                 303
  Finding Aids:
      Material Approved for Incorporation by Reference........     381
      Table of CFR Titles and Chapters........................     383
      Alphabetical List of Agencies Appearing in the CFR......     401
      Redesignation Table.....................................     411
      List of CFR Sections Affected...........................     413



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                     ----------------------------

                     Cite this Code:  CFR
                     To cite the regulations in 
                       this volume use title, 
                       part and section number. 
                       Thus,  31 CFR 0.101 refers 
                       to title 31, part 0, 
                       section 101.

                     ----------------------------

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                               EXPLANATION

    The Code of Federal Regulations is a codification of the general and 
permanent rules published in the Federal Register by the Executive 
departments and agencies of the Federal Government. The Code is divided 
into 50 titles which represent broad areas subject to Federal 
regulation. Each title is divided into chapters which usually bear the 
name of the issuing agency. Each chapter is further subdivided into 
parts covering specific regulatory areas.
    Each volume of the Code is revised at least once each calendar year 
and issued on a quarterly basis approximately as follows:

Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1

    The appropriate revision date is printed on the cover of each 
volume.

LEGAL STATUS

    The contents of the Federal Register are required to be judicially 
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie 
evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

    The Code of Federal Regulations is kept up to date by the individual 
issues of the Federal Register. These two publications must be used 
together to determine the latest version of any given rule.
    To determine whether a Code volume has been amended since its 
revision date (in this case, July 1, 2000), consult the ``List of CFR 
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative 
List of Parts Affected,'' which appears in the Reader Aids section of 
the daily Federal Register. These two lists will identify the Federal 
Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

    Each volume of the Code contains amendments published in the Federal 
Register since the last revision of that volume of the Code. Source 
citations for the regulations are referred to by volume number and page 
number of the Federal Register and date of publication. Publication 
dates and effective dates are usually not the same and care must be 
exercised by the user in determining the actual effective date. In 
instances where the effective date is beyond the cut-off date for the 
Code a note has been inserted to reflect the future effective date. In 
those instances where a regulation published in the Federal Register 
states a date certain for expiration, an appropriate note will be 
inserted following the text.

OMB CONTROL NUMBERS

    The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires 
Federal agencies to display an OMB control number with their information 
collection request.

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Many agencies have begun publishing numerous OMB control numbers as 
amendments to existing regulations in the CFR. These OMB numbers are 
placed as close as possible to the applicable recordkeeping or reporting 
requirements.

OBSOLETE PROVISIONS

    Provisions that become obsolete before the revision date stated on 
the cover of each volume are not carried. Code users may find the text 
of provisions in effect on a given date in the past by using the 
appropriate numerical list of sections affected. For the period before 
January 1, 1986, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, or 1973-1985, published in seven separate volumes. For 
the period beginning January 1, 1986, a ``List of CFR Sections 
Affected'' is published at the end of each CFR volume.

INCORPORATION BY REFERENCE

    What is incorporation by reference? Incorporation by reference was 
established by statute and allows Federal agencies to meet the 
requirement to publish regulations in the Federal Register by referring 
to materials already published elsewhere. For an incorporation to be 
valid, the Director of the Federal Register must approve it. The legal 
effect of incorporation by reference is that the material is treated as 
if it were published in full in the Federal Register (5 U.S.C. 552(a)). 
This material, like any other properly issued regulation, has the force 
of law.
    What is a proper incorporation by reference? The Director of the 
Federal Register will approve an incorporation by reference only when 
the requirements of 1 CFR part 51 are met. Some of the elements on which 
approval is based are:
    (a) The incorporation will substantially reduce the volume of 
material published in the Federal Register.
    (b) The matter incorporated is in fact available to the extent 
necessary to afford fairness and uniformity in the administrative 
process.
    (c) The incorporating document is drafted and submitted for 
publication in accordance with 1 CFR part 51.
    Properly approved incorporations by reference in this volume are 
listed in the Finding Aids at the end of this volume.
    What if the material incorporated by reference cannot be found? If 
you have any problem locating or obtaining a copy of material listed in 
the Finding Aids of this volume as an approved incorporation by 
reference, please contact the agency that issued the regulation 
containing that incorporation. If, after contacting the agency, you find 
the material is not available, please notify the Director of the Federal 
Register, National Archives and Records Administration, Washington DC 
20408, or call (202) 523-4534.

CFR INDEXES AND TABULAR GUIDES

    A subject index to the Code of Federal Regulations is contained in a 
separate volume, revised annually as of January 1, entitled CFR Index 
and Finding Aids. This volume contains the Parallel Table of Statutory 
Authorities and Agency Rules (Table I). A list of CFR titles, chapters, 
and parts and an alphabetical list of agencies publishing in the CFR are 
also included in this volume.
    An index to the text of ``Title 3--The President'' is carried within 
that volume.
    The Federal Register Index is issued monthly in cumulative form. 
This index is based on a consolidation of the ``Contents'' entries in 
the daily Federal Register.
    A List of CFR Sections Affected (LSA) is published monthly, keyed to 
the revision dates of the 50 CFR titles.

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REPUBLICATION OF MATERIAL

    There are no restrictions on the republication of material appearing 
in the Code of Federal Regulations.

INQUIRIES

    For a legal interpretation or explanation of any regulation in this 
volume, contact the issuing agency. The issuing agency's name appears at 
the top of odd-numbered pages.
    For inquiries concerning CFR reference assistance, call 202-523-5227 
or write to the Director, Office of the Federal Register, National 
Archives and Records Administration, Washington, DC 20408 or e-mail 
[email protected].

SALES

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ELECTRONIC SERVICES

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    The Office of the Federal Register also offers a free service on the 
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site also contains links to GPO Access.

                              Raymond A. Mosley,
                                    Director,
                          Office of the Federal Register.

July 1, 2000.



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                               THIS TITLE

    Title 31--Money and Finance: Treasury is composed of two volumes. 
The parts in these volumes are arranged in the following order: parts 0-
199, and part 200 to end. The contents of these volumes represent all 
current regulations codified under this title of the CFR as of July 1, 
2000.

    A redesignation table for subtitle A--Office of the Secretary of the 
Treasury appears in the Finding Aids section of the first volume.

    For this volume, Shelley C. Featherson was Chief Editor. The Code of 
Federal Regulations publication program is under the direction of 
Frances D. McDonald, assisted by Alomha S. Morris.

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

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                  TITLE 31--MONEY AND FINANCE: TREASURY




                   (This book contains parts 0 to 199)

  --------------------------------------------------------------------



  Editorial Note: Other regulations issued by Department of the Treasury 
appear in Title 12, Chapter I; Title 19, Chapter I; Title 26, Chapter I; 
Title 27, Chapter I; Title 31, Chapters II, IV, V, VI, and VII, and 
Title 48, Chapter 10.
                                                                    Part

SUBTITLE A--Office of the Secretary of the Treasury.........           0

         SUBTITLE B--Regulations Relating to Money and Finance:

chapter i--Monetary Offices, Department of the Treasury.....          56

Cross Reference: General Accounting Office: See 4 CFR Chapter I.

[[Page 3]]

                        Subtitle A--Office of the

                        Secretary of the Treasury

  --------------------------------------------------------------------

Part                                                                Page
0               Department of the Treasury Employee Rules of 
                    Conduct.................................           5
1               Disclosure of records.......................          10
2               National security information...............         117
3               Claims regulations and indemnification of 
                    Department of Treasury employees........         143
4               Employees' personal property claims.........         146
5               Claims collection...........................         147
6               Applications for awards under the Equal 
                    Access to Justice Act...................         162
7               Employee inventions.........................         166
8               Practice before the Bureau of Alcohol, 
                    Tobacco and Firearms....................         167
9               Effects of imported articles on the national 
                    security................................         181
10              Practice before the Internal Revenue Service         184
11              Operation of vending facilities by the blind 
                    on Federal property under the control of 
                    the Department of the Treasury..........         216
12              Restriction of sale and distribution of 
                    tobacco products........................         217
13              Procedures for providing assistance to State 
                    and local governments in protecting 
                    foreign diplomatic missions.............         218
14              Right to Financial Privacy Act..............         223
15              Post employment conflict of interest........         224
16              Regulations implementing the Program Fraud 
                    Civil Remedies Act of 1986..............         230
17              Enforcement of nondiscrimination on the 
                    basis of handicap in programs or 
                    activities conducted by the Department 
                    of the Treasury.........................         246

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18              Officials designated to perform the 
                    functions and duties of certain offices 
                    in case of absence, disability, or 
                    vacancy.................................         252
19              Governmentwide debarment and suspension 
                    (nonprocurement) and governmentwide 
                    requirements for drug-free workplace 
                    (grants)................................         253
21              New restrictions on lobbying................         271
25              Prepayment of foreign military sales loans 
                    made by the Defense Security Assistance 
                    Agency and foreign military sales loans 
                    made by the Federal Financing Bank and 
                    guaranteed by the Defense Security 
                    Assistance Agency.......................         283
26              Environmental Review of Actions by 
                    Multilateral Development Bands (MDBs)...         293
27              Civil penalty assessment for misuse of 
                    Department of the Treasury names, 
                    symbols, etc............................         296

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PART 0--DEPARTMENT OF THE TREASURY EMPLOYEE RULES OF CONDUCT--Table of Contents




                      Subpart A--General Provisions

Sec.
0.101  Purpose.
0.102  Policy.
0.103  Definitions.

                            Responsibilities

0.104  Designated Agency Ethics Official and Alternate Designated Agency 
          Ethics Official.
0.105  Deputy Ethics Official.
0.106  Bureau Heads.
0.107  Employees.

                       Subpart B--Rules of Conduct

0.201  Political activity.
0.202  Strikes.
0.203  Gifts or gratuities from foreign governments.
0.204  Use of controlled substances and intoxicants.
0.205  Care of documents and data.
0.206  Disclosure of information.
0.207  Cooperation with official inquiries.
0.208  Falsification of official records.
0.209  Use of Government vehicles.
0.210  Conduct while on official duty or on Government property.
0.211  Soliciting, selling and canvassing.
0.212  Influencing legislation or petitioning Congress.
0.213  General conduct prejudicial to the Government.
0.214  Nondiscrimination.
0.215  Possession of weapons and explosives.
0.216  Privacy Act.
0.217  Personal financial interests.

                 Subpart C--Special Government Employees

0.301  Applicability of subpart B.
0.302  Service with other Federal agencies.

                  Subpart D--Advisers to the Department

0.401  Advisers to the Department.

    Authority: 5 U.S.C. 301.

    Source: 60 FR 28535, June 1, 1995, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 0.101  Purpose.

    (a) The Department of the Treasury Employee Rules of Conduct (Rules) 
are separate from and additional to the Standards of Ethical Conduct for 
Employees of the Executive Branch (Executive Branch-wide Standards) (5 
CFR part 2635) and the Supplemental Standards of Ethical Conduct for 
Employees of the Department of the Treasury (Treasury Supplemental 
Standards) (to be codified at 5 CFR part 3101). The Rules prescribe 
employee rules of conduct and procedure and provide for disciplinary 
action for the violation of the Rules, the Treasury Supplemental 
Standards, the Executive Branch-wide Standards, and any other rule, 
regulation or law governing Department employees.
    (b) The Rules are not all-inclusive and may be modified by 
interpretive guidelines and procedures issued by the Department's 
bureaus. The absence of a specific published rule of conduct covering an 
action does not constitute a condonation of that action or indicate that 
the action would not result in corrective or disciplinary action.



Sec. 0.102  Policy.

    (a) All employees and officials of the Department are required to 
follow the rules of conduct and procedure contained in the Rules, the 
Treasury Supplemental Standards, the Executive Branch-wide Standards of 
Ethical Conduct, the Employee Responsibilities and Conduct (5 CFR part 
735), and any bureau issued rules.
    (b) Employees found in violation of the Rules, the Treasury 
Supplemental Standards, the Executive Branch-wide Standards or any 
applicable bureau rule may be instructed to take remedial or corrective 
action to eliminate the conflict. Remedial action may include, but is 
not limited to:
    (1) Reassignment of work duties;
    (2) Disqualification from a particular assignment;
    (3) Divestment of a conflicting interest; or
    (4) Other appropriate action.
    (c) Employees found in violation of the Rules, the Treasury 
Supplemental Standards, the Executive Branch-wide Standards or any 
applicable bureau rule may be disciplined in proportion to the gravity 
of the offense committed, including removal. Disciplinary action will be 
taken in accordance with applicable laws and regulations

[[Page 6]]

and after consideration of the employee's explanation and any mitigating 
factors. Further, disciplinary action may include any additional penalty 
prescribed by law.



Sec. 0.103  Definitions.

    The following definitions are used throughout this part:
    (a) Adviser means a person who provides advice to the Department as 
a representative of an outside group and is not an employee or special 
Government employee as those terms are defined in Sec. 0.103.
    (b) Bureau means:
    (1) Bureau of Alcohol, Tobacco and Firearms;
    (2) Bureau of Engraving and Printing;
    (3) Bureau of the Public Debt;
    (4) Departmental Offices;
    (5) Federal Law Enforcement Training Center;
    (6) Financial Management Service;
    (7) Internal Revenue Service;
    (8) Legal Division;
    (9) Office of the Comptroller of the Currency;
    (10) Office of the Inspector General;
    (11) Office of Thrift Supervision;
    (12) United States Customs Service;
    (13) United States Mint;
    (14) United States Secret Service; and
    (15) Any organization designated as a bureau by the Secretary 
pursuant to appropriate authority.
    (c) Person means an individual, corporation and subsidiaries it 
controls, company, association, firm, partnership, society, joint stock 
company, or any other organization or institution as specified in 5 CFR 
2635.102(k).
    (d) Regular employee or employee means an officer or employee of the 
Department of the Treasury but does not include a special Government 
employee.
    (e) Special Government employee means an officer or employee who is 
retained, designated, appointed, or employed to perform temporary duties 
either on a full-time or intermittent basis, with or without 
compensation, for a period not to exceed 130 days during any consecutive 
365-day period. See 18 U.S.C. 202(a).

                            Responsibilities



Sec. 0.104  Designated Agency Ethics Official and Alternate Designated Agency Ethics Official.

    The Deputy General Counsel is the Department's Designated Agency 
Ethics Official (DAEO). The DAEO is responsible for managing the 
Department's ethics program, including coordinating ethics counseling 
and interpreting questions of conflicts of interest and other matters 
that arise under the Executive Branch-wide Standards and Treasury 
Supplemental Standards and Rules. See 5 CFR 2638.203. The Senior Counsel 
for Ethics is the Alternate Designated Agency Ethics Official.



Sec. 0.105  Deputy Ethics Official.

    The Chief Counsel or Legal Counsel for a bureau, or a designee, is 
the Deputy Ethics Official for that bureau. The Legal Counsel for the 
Financial Crimes Enforcement Network is the Deputy Ethics Official for 
that organization. It is the responsibility of the Deputy Ethics 
Official to give authoritative advice and guidance on conflicts of 
interest and other matters arising under the Executive Branch-wide 
Standards, Treasury Supplemental Standards, and the Rules.



Sec. 0.106  Bureau Heads.

    Bureau heads or designees are required to:
    (a) Provide all employees with a copy of Executive Order 12674, as 
amended by Executive Order 12731, the Executive Branch-wide Standards, 
the Treasury Supplemental Standards and the Rules; provide all new 
employees with an explanation of the contents and application of the 
Executive Branch-wide Standards, Treasury Supplemental Standards and the 
Rules; and provide all departing employees with an explanation of the 
applicable post-employment restrictions contained in 18 U.S.C. 207 and 5 
CFR part 2641 and any other applicable law or regulation.
    (b) Provide guidance and assistance to supervisors and employees in 
implementing and adhering to the rules and procedures included in the 
Executive Branch-wide Standards and Treasury

[[Page 7]]

Supplemental Standards and Rules; obtain any necessary legal advice or 
interpretation from the Designated Agency Ethics Official or a Deputy 
Ethics Official; and inform employees as to how and from whom they may 
obtain additional clarification or interpretation of the Executive 
Branch-wide Standards, Treasury Supplemental Standards, Rules, and any 
other relevant law, rule or regulation.
    (c) Take appropriate corrective or disciplinary action against an 
employee who violates the Executive Branch-wide Standards, Treasury 
Supplemental Standards or Rules, or any other applicable law, rule or 
regulation, and against a supervisor who fails to carry out his 
responsibilities in taking or recommending corrective or disciplinary 
action when appropriate against an employee who has committed an 
offense.



Sec. 0.107  Employees.

    (a) Employees are required to:
    (1) Read and follow the rules and procedures contained in the 
Executive Branch-wide Standards, Treasury Supplemental Standards, and 
Rules;
    (2) Request clarification or interpretation from a supervisor or 
ethics official if the application of a rule contained in the Executive 
Branch-wide Standards, Treasury Supplemental Standards, or Rules is not 
clear;
    (3) Report to the Inspector General or to the appropriate internal 
affairs office of the Bureau of Alcohol, Tobacco and Firearms, Customs 
Service, Internal Revenue Service, or Secret Service, any information 
indicating that an employee, former employee, contractor, subcontractor, 
or potential contractor engaged in criminal conduct or that an employee 
or former employee violated the Executive Branch-wide Standards or the 
Treasury Supplemental Standards or Rules. Legal Division attorneys 
acquiring this type of information during the representation of a bureau 
shall report it to the appropriate Chief or Legal Counsel or the Deputy 
General Counsel, who shall report such information to the Inspector 
General or appropriate internal affairs office; and
    (4) Report to the Inspector General information defined in paragraph 
(a)(3) of this section relating to foreign intelligence or national 
security, as covered in Executive Order 12356. Legal Division attorneys 
acquiring this type of information during the representation of a bureau 
shall report it to the Deputy General Counsel, who shall report such 
information to the Inspector General.
    (b) The confidentiality of the source of the information reported to 
the Inspector General or the internal affairs office under this section 
will be maintained to the extent appropriate under the circumstances.



                       Subpart B--Rules of Conduct



Sec. 0.201  Political activity.

    (a) Employees may:
    (1) Take an active part in political management or in political 
campaigns to the extent permitted by law (5 U.S.C. 7321-7326); and
    (2) Vote as they choose and express their opinions on political 
subjects and candidates.
    (b) Employees may not use their official authority or influence to 
interfere with or affect election results.
    (c) Employees may be disqualified from employment for knowingly 
supporting or advocating the violent overthrow of our constitutional 
form of government.
    Note: The Hatch Act Reform Amendments of 1993 significantly reduced 
the statutory restrictions on the political activity of most Department 
employees. However, career members of the Senior Executive Service and 
employees of the Secret Service, the Internal Revenue Service, Office of 
Criminal Investigation, the Customs Service, Office of Investigative 
Programs, and the Bureau of Alcohol, Tobacco and Firearms, Office of Law 
Enforcement, remain subject to significant restrictions on their 
political activities.



Sec. 0.202  Strikes.

    Employees shall not strike against the Government.



Sec. 0.203  Gifts or gratuities from foreign governments.

    (a) The United States Constitution prohibits employees from 
accepting gifts, emoluments, offices, or titles from a foreign 
government without the consent of the Congress. Congress has consented 
to an employee accepting

[[Page 8]]

and retaining a gift from a foreign government that is of minimal value 
and offered as a souvenir or mark of courtesy, unless otherwise 
prohibited by bureau regulation (5 U.S.C. 7342). Minimal value is 
prescribed in 41 CFR part 101-49 and was set at $225.00 on the date that 
the Rules became effective.
    (b) All gifts exceeding minimal value, the refusal of which would 
likely cause offense or embarrassment or otherwise adversely affect the 
foreign relations of the United States, shall be accepted and deposited 
with the Department within sixty days of acceptance. If the gift is 
travel or expenses for travel taking place entirely outside the United 
States, it shall be reported within thirty days (see 5 U.S.C. 
7342(c)(1)(B)(ii)).
    (c) As used in paragraph (b) of this section, Deposit with the 
Department means delivery to the Department Gift Unit or other 
depository as authorized by the Treasury Directive on Foreign Gifts 
(Treasury Directive 61-04).
    (d) All foreign gifts must be reported as prescribed in the Treasury 
Directive on Foreign Gifts (Treasury Directive 61-04).



Sec. 0.204  Use of controlled substances and intoxicants.

    Employees shall not sell, use or possess controlled substances or 
intoxicants in violation of the law while on Department property or 
official duty, or use a controlled substance or intoxicant in a manner 
that adversely affects their work performance.



Sec. 0.205  Care of documents and data.

    (a) Employees shall not conceal, remove, alter, destroy, mutilate or 
access documents or data in the custody of the Federal Government 
without proper authority.
    (b) Employees are required to care for documents according to 
Federal law and regulation, and Department procedure (18 U.S.C. 2071, 5 
U.S.C. 552, 552a).
    (c) The term documents includes, but is not limited to, any writing, 
recording, computer tape or disk, blueprint, photograph, or other 
physical object on which information is recorded.



Sec. 0.206  Disclosure of information.

    Employees shall not disclose official information without proper 
authority, pursuant to Department or bureau regulation. Employees 
authorized to make disclosures should respond promptly and courteously 
to requests from the public for information when permitted to do so by 
law (31 CFR 1.9, 1.10, and 1.28(b)).



Sec. 0.207  Cooperation with official inquiries.

    Employees shall respond to questions truthfully and under oath when 
required, whether orally or in writing, and must provide documents and 
other materials concerning matters of official interest when directed to 
do so by competent Treasury authority.



Sec. 0.208  Falsification of official records.

    Employees shall not intentionally make false, misleading or 
ambiguous statements, orally or in writing, in connection with any 
matter of official interest. Matters of official interest include among 
other things: Transactions with the public, government agencies or 
fellow employees; application forms and other forms that serve as a 
basis for appointment, reassignment, promotion or other personnel 
action; vouchers; leave records and time and attendance records; work 
reports of any nature or accounts of any kind; affidavits; entry or 
record of any matter relating to or connected with an employee's duties; 
and reports of any moneys or securities received, held or paid to, for 
or on behalf of the United States.



Sec. 0.209  Use of Government vehicles.

    Employees shall not use Government vehicles for unofficial purposes, 
including to transport unauthorized passengers. The use of Government 
vehicles for transporting employees between their domiciles and places 
of employment must be authorized by statute (See, e.g., 31 U.S.C. 1344).



Sec. 0.210  Conduct while on official duty or on Government property.

    Employees must adhere to the regulations controlling conduct when 
they are on official duty or in or on Government property, including the 
Treasury Building, Treasury Annex Building and grounds; the Bureau of 
Engraving and Printing buildings and grounds; the

[[Page 9]]

United States Mint buildings and grounds; the grounds of the Federal Law 
Enforcement Training Center; and Treasury-occupied General Services 
Administration buildings and grounds (see 31 CFR parts 91, 407, 605, 
700).



Sec. 0.211  Soliciting, selling and canvassing.

    Employees shall not solicit, make collections, canvass for the sale 
of any article, or distribute literature or advertising in any space 
occupied by the Department without appropriate authority.



Sec. 0.212  Influencing legislation or petitioning Congress.

    (a) Employees shall not use Government time, money, or property to 
petition a Member of Congress to favor or oppose any legislation. This 
prohibition does not apply to the official handling, through the proper 
channels, of matters relating to legislation in which the Department of 
the Treasury has an interest.
    (b) Employees, individually or collectively, may petition Congress 
or Members of Congress or furnish information to either House of 
Congress when not using Government time, money or property (5 U.S.C. 
7211).



Sec. 0.213  General conduct prejudicial to the Government.

    Employees shall not engage in criminal, infamous, dishonest, or 
notoriously disgraceful conduct, or any other conduct prejudicial to the 
Government.



Sec. 0.214  Nondiscrimination.

    (a) Employees shall not discriminate against or harass any other 
employee, applicant for employment or person dealing with the Department 
on official business on the basis of race, color, religion, national 
origin, sex, sexual orientation, age, or disability. Sexual harassment 
is a form of sex discrimination and is prohibited by this section.
    (b) An employee who engages in discriminatory conduct may be 
disciplined under these rules. However, this section does not create any 
enforceable legal rights in any person.



Sec. 0.215  Possession of weapons and explosives.

    (a) Employees shall not possess firearms, explosives, or other 
dangerous or deadly weapons, either openly or concealed, while on 
Government property or official duty.
    (b) The prohibition in paragraph (a) of this section does not apply 
to employees who are required to possess weapons or explosives in the 
performance of their official duties.



Sec. 0.216  Privacy Act.

    Employees involved in the design, development, operation, or 
maintenance of any system of records or in maintaining records subject 
to the Privacy Act of 1974, as amended (5 U.S.C. 552a), shall comply 
with the conduct regulations delineated in 31 CFR 1.28(b).



Sec. 0.217  Personal financial interests.

    (a) Employees may hold the following financial interests without 
violating 18 U.S.C. 208(a):
    (1) The stocks or bonds of a publicly traded corporation with a 
value of $1000 or less; and
    (2) The stocks or bonds in the investment portfolio of a diversified 
mutual fund in which an employee has invested.
    (b) The Department has found that the financial interests listed in 
paragraph (a) of this section are too remote and inconsequential to 
affect the integrity of an employee's service.



                 Subpart C--Special Government Employees



Sec. 0.301  Applicability of subpart B.

    The rules of conduct contained in subpart B of this part apply to 
special Government employees employed with the Treasury Department. The 
regulations contained in Sec. 0.201 of subpart B, concerning political 
activity, apply to special Government employees only on the days that 
they serve the Department. Treasury bureaus are responsible for 
informing special Government employees employed with them of the 
applicability of bureau specific statutes or regulations.

[[Page 10]]



Sec. 0.302  Service with other Federal agencies.

    A special Government employee serving concurrently in the Department 
and in a Federal agency other than the Department is required to inform 
the Department and the agency in which he serves of the arrangement so 
that appropriate administrative measures may be taken.



                  Subpart D--Advisers to the Department



Sec. 0.401  Advisers to the Department.

    (a) An adviser or advisory committee member includes an individual 
who provides advice to the Department as a representative of an outside 
group and is not an employee or special Government employee of the 
Department. Questions concerning whether an individual serves the 
Department in the capacity of an adviser, employee, or special 
Government employee shall be addressed to the Designated Agency Ethics 
Official or a Deputy Ethics Official.
    (b) Advisers or advisory committee members are not required to 
follow the Rules and are not generally required by the Department to 
file financial disclosure statements; nevertheless, they should be 
guided by the regulations in this part covering such issues as public 
disclosure of official information (Sec. 0.206), conduct (Sec. 0.211 and 
Sec. 0.213), and gifts or gratuities from Foreign governments 
(Sec. 0.203).



PART 1--DISCLOSURE OF RECORDS--Table of Contents




                  Subpart A--Freedom of Information Act

Sec.
1.1   General.
1.2   Information made available.
1.3   Publication in the Federal Register.
1.4   Public inspection and copying.
1.5   Specific requests for other records.
1.6   Business information.
1.7   Fees for services.

                         Appendices to Subpart A

Appendix A--Departmental Offices
Appendix B--Internal Revenue Service
Appendix C--United States Customs Service
Appendix D--United States Secret Service
Appendix E--Bureau of Alcohol, Tobacco and Firearms
Appendix F--Bureau of Engraving and Printing
Appendix G--Financial Management Service
Appendix H--United States Mint
Appendix I--Bureau of the Public Debt
Appendix J--Office of the Comptroller of the Currency
Appendix K--Federal Law Enforcement Training Center
Appendix L--Office of Thrift Supervision

                 Subpart B--Other Disclosure Provisions

1.8  Scope.
1.9  Records not to be otherwise withdrawn or disclosed.
1.10  Oral information.
1.11  Testimony or the production of records in a court or other 
          proceeding.
1.12  Regulations not applicable to official request.

                         Subpart C--Privacy Act

1.20  Purpose and scope of regulations.
1.21  Definitions.
1.22  Requirements relating to systems of records.
1.23  Publication in the Federal Register--Notices of systems of 
          records, general exemptions, specific exemptions, review of 
          all systems.
1.24  Disclosure of records to person other than the individual to whom 
          they pertain.
1.25  Accounting of disclosures.
1.26  Procedures for notification and access to records pertaining to 
          individuals--format and fees for request for access.
1.27  Procedures for amendment of records pertaining to individuals--
          format, agency review and appeal from initial adverse agency 
          determination.

[[Page 11]]

1.28  Training, rules of conduct, penalties for non-compliance.
1.29  Records transferred to Federal Records Center or National Archives 
          of the United States.
1.30  Application to system of records maintained by Government 
          contractors.
1.31  Sale or rental of mailing lists.
1.32  Use and disclosure of social security numbers.
1.34  Guardianship.
1.35  Information forms.
1.36  Systems exempt in whole or in part from provisions of 5 U.S.C. 
          552a and this part.

                         Appendices to Subpart C

Appendix A--Departmental Offices
Appendix B--Internal Revenue Service
Appendix C--United States Customs Service
Appendix D--United States Secret Service
Appendix E--Bureau of Alcohol, Tobacco and Firearms
Appendix F--Bureau of Engraving and Printing
Appendix G--Financial Management Service
Appendix H--United States Mint
Appendix I--Bureau of the Public Debt
Appendix J--Office of the Comptroller of the Currency
Appendix K--Federal Law Enforcement Training Center
Appendix L--Office of Thrift Supervision

    Authority: 5 U.S.C. 301 and 31 U.S.C. 321. Subpart A also issued 
under 5 U.S.C. 552, as amended. Subpart C also issued under 5 U.S.C. 
552a.

    Source: 52 FR 26305, July 14, 1987, unless otherwise noted.



                  Subpart A--Freedom of Information Act

    Source: 65 FR 40504, June 30, 2000, unless otherwise noted.



Sec. 1.1  General.

    (a) Purpose and scope. (1) This subpart contains the regulations of 
the Department of the Treasury implementing the Freedom of Information 
Act (FOIA), 5 U.S.C. 552, as amended by the Electronic Freedom of 
Information Act Amendments of 1996. The regulations set forth procedures 
for requesting access to records maintained by the Department of the 
Treasury. These regulations apply to all bureaus of the Department of 
the Treasury. Any reference in this subpart to the Department or its 
officials, employees, or records shall be deemed to refer also to the 
bureaus or their officials, employees, or records. Persons interested in 
the records of a particular bureau should also consult the appendix to 
this subpart that pertains to that bureau. The head of each bureau is 
hereby authorized to substitute the officials designated and change the 
addresses specified in the appendix to this subpart applicable to the 
bureau. The bureaus of the Department of the Treasury for the purposes 
of this subpart are:
    (i) The Departmental Offices, which include the offices of:
    (A) The Secretary of the Treasury, including immediate staff;
    (B) The Deputy Secretary of the Treasury, including immediate staff;
    (C) The Chief of Staff, including immediate staff;
    (D) The Executive Secretary and all offices reporting to such 
official, including immediate staff;
    (E) The Under Secretary of the Treasury for International Affairs 
and all offices reporting to such official, including immediate staff;
    (F) The Under Secretary of the Treasury for Domestic Finance and all 
offices reporting to such official, including immediate staff;
    (G) The Under Secretary for Enforcement and all offices reporting to 
such official, including immediate staff;
    (H) The Assistant Secretary of the Treasury for Financial 
Institutions and all offices reporting to such official, including 
immediate staff;
    (I) The Assistant Secretary of the Treasury for Economic Policy and 
all offices reporting to such official, including immediate staff;
    (J) The Fiscal Assistant Secretary and all offices reporting to such 
official, including immediate staff;
    (K) The General Counsel and all offices reporting to such official, 
including immediate staff; except legal counsel to the components listed 
in paragraphs (a)(1)(i)(L), and (a)(1)(i)(S), and (a)((1)(ii) through 
(xii) of this section;
    (L) The Inspector General and all offices reporting to such 
official, including immediate staff;
    (M) The Assistant Secretary of the Treasury for International 
Affairs and

[[Page 12]]

all offices reporting to such official, including immediate staff;
    (N) The Assistant Secretary of the Treasury for Legislative Affairs 
and Public Liaison and all offices reporting to such official, including 
immediate staff;
    (O) The Assistant Secretary of the Treasury for Management and Chief 
Financial Officer and all offices reporting to such official, including 
immediate staff;
    (P) The Assistant Secretary of the Treasury for Public Affairs and 
all offices reporting to such official, including immediate staff;
    (Q) The Assistant Secretary of the Treasury for Tax Policy and all 
offices reporting to such official, including immediate staff;
    (R) The Treasurer of the United States, including immediate staff;
    (S) The Treasury Inspector General for Tax Administration and all 
offices reporting to such official, including immediate staff.
    (ii) The Bureau of Alcohol, Tobacco and Firearms.
    (iii) The Office of the Comptroller of the Currency.
    (iv) The United States Customs Service.
    (v) The Bureau of Engraving and Printing.
    (vi) The Federal Law Enforcement Training Center.
    (vii) The Financial Management Service.
    (viii) The Internal Revenue Service.
    (ix) The United States Mint.
    (x) The Bureau of the Public Debt.
    (xi) The United States Secret Service.
    (xii) The Office of Thrift Supervision.
    (2) For purposes of this subpart, the office of the legal counsel 
for the components listed in paragraphs (a)(1)(ii) through (xii) of this 
section are to be considered a part of their respective bureaus. Any 
office which is now in existence or may hereafter be established, which 
is not specifically listed or known to be a component of any of those 
listed in paragraphs (a)(1)(i) through (xii) of this section, shall be 
deemed a part of the Departmental Offices for the purpose of making 
requests for records under this subpart.
    (b) Definitions. As used in this subpart, the following terms shall 
have the following meanings:
    (1) Agency has the meaning given in 5 U.S.C. 551(1) and 5 U.S.C. 
552(f).
    (2) Appeal means a request for a review of an agency's determination 
with regard to a fee waiver, category of requester, expedited 
processing, or denial in whole or in part of a request for access to a 
record or records.
    (3) Bureau means an entity of the Department of the Treasury that is 
authorized to act independently in disclosure matters.
    (4) Business information means trade secrets or other commercial or 
financial information.
    (5) Business submitter means any entity which provides business 
information to the Department of the Treasury or its bureaus and which 
has a proprietary interest in the information. (6) Computer 
software means tools by which records are created, stored, and 
retrieved. Normally, computer software, including source code, object 
code, and listings of source and object codes, regardless of medium, are 
not agency records. However, when data are embedded within the software 
and cannot be extracted without the software, the software may have to 
be treated as an agency record. Proprietary (or copyrighted) software is 
not an agency record.
    (7) Confidential commercial information means records provided to 
the government by a submitter that arguably contain material exempt from 
release under Exemption 4 of the Freedom of Information Act, 5 U.S.C. 
552(b)(4), because disclosure could reasonably be expected to cause 
substantial competitive harm.
    (8) Duplication refers to the process of making a copy of a record 
in order to respond to a FOIA request. Such copies can take the form of 
paper copy, microform, audio-visual materials, or machine readable 
documentation (e.g., magnetic tape or disk), among others.
    (9) Electronic records means those records and information which are 
created, stored, and retrievable by electronic means. This ordinarily 
does not include computer software, which is a tool by which to create, 
store, or retrieve electronic records.

[[Page 13]]

    (10) Request means any request for records made pursuant to 5 U.S.C. 
552(a)(3).
    (11) Requester means any person who makes a request for access to 
records.
    (12) Responsible official means a disclosure officer or the head of 
the organizational unit having immediate custody of the records 
requested, or an official designated by the head of the organizational 
unit.
    (13) Review, for fee purposes, refers to the process of examining 
records located in response to a commercial use request to determine 
whether any portion of any record located is permitted to be withheld. 
It also includes processing any records for disclosure; e.g., doing all 
that is necessary to excise them and otherwise prepare them for release.
    (14) Search includes all time spent looking for material that is 
responsive to a request, including page-by-page or line-by-line 
identification of material within records. Searches may be done manually 
or by automated means.



Sec. 1.2  Information made available.

    (a) General. The FOIA (5 U.S.C. 552) provides for access to 
information and records developed or maintained by Federal agencies. The 
provisions of section 552 are intended to assure the right of the public 
to information. Generally, this section divides agency information into 
three major categories and provides methods by which each category of 
information is to be made available to the public. The three major 
categories of information are as follows:
    (1) Information required to be published in the Federal Register 
(see Sec. 1.3);
    (2) Information required to be made available for public inspection 
and copying or, in the alternative, to be published and offered for sale 
(see Sec. 1.4); and
    (3) Information required to be made available to any member of the 
public upon specific request (see Sec. 1.5).
    (b) Subject only to the exemptions and exclusions set forth in 5 
U.S.C. 552(b) and (c), any person shall be afforded access to 
information or records in the possession of any bureau of the Department 
of the Treasury, subject to the regulations in this subpart and any 
regulations of a bureau implementing or supplementing them.
    (c) Exemptions. (1) The disclosure requirements of 5 U.S.C. 552(a) 
do not apply to certain matters which are exempt under 5 U.S.C. 552(b); 
nor do the disclosure requirements apply to certain matters which are 
excluded under 5 U.S.C. 552(c).
    (2) Even though an exemption described in 5 U.S.C. 552(b) may be 
applicable to the information or records requested, a Treasury bureau 
may, if not precluded by law, elect under the circumstances of that 
request not to apply the exemption. The fact that the exemption is not 
applied by a bureau in response to a particular request shall have no 
precedential significance in processing other requests, but is merely an 
indication that, in the processing of the particular request, the bureau 
finds no necessity for applying the exemption.



Sec. 1.3  Publication in the Federal Register.

    (a) Requirement. Subject to the application of the exemptions and 
exclusions in 5 U.S.C. 552(b) and (c) and subject to the limitations 
provided in 5 U.S.C. 552(a)(1), each Treasury bureau shall, in 
conformance with 5 U.S.C. 552(a)(1), separately state, publish and 
maintain current in the Federal Register for the guidance of the public 
the following information with respect to that bureau:
    (1) Descriptions of its central and field organization and the 
established places at which, the persons from whom, and the methods 
whereby, the public may obtain information, make submittals or requests, 
or obtain decisions;
    (2) Statements of the general course and method by which its 
functions are channeled and determined, including the nature and 
requirements of all formal and informal procedures available;
    (3) Rules of procedure, descriptions of forms available or the 
places at which forms may be obtained, and instructions as to the scope 
and contents of all papers, reports, or examinations;
    (4) Substantive rules of general applicability adopted as authorized 
by law,

[[Page 14]]

and statements of general policy or interpretations of general 
applicability formulated and adopted by the bureau; and
    (5) Each amendment, revision, or repeal of matters referred to in 
paragraphs (a)(1) through (4) of this section.
    (b) The United States Government Manual. The functions of each 
bureau are summarized in the description of the Department and its 
bureaus in the United States Government Manual, which is issued annually 
by the Office of the Federal Register.



Sec. 1.4  Public inspection and copying.

    (a) In general. Subject to the application of the exemptions and 
exclusions described in 5 U.S.C. 552(b) and (c), each Treasury bureau 
shall, in conformance with 5 U.S.C. 552(a)(2), make available for public 
inspection and copying, or, in the alternative, promptly publish and 
offer for sale the following information with respect to the bureau:
    (1) Final opinions, including concurring and dissenting opinions, 
and orders, made in the adjudication of cases;
    (2) Those statements of policy and interpretations which have been 
adopted by the bureau but are not published in the Federal Register;
    (3) Its administrative staff manuals and instructions to staff that 
affect a member of the public;
    (4) Copies of all records, regardless of form or format, which have 
been released to any person under 5 U.S.C. 552(a)(3), and which the 
bureau determines have become or are likely to become the subject of 
subsequent requests for substantially the same records because they are 
clearly of interest to the public at large. The determination that 
records have become or may become the subject of subsequent requests 
shall be made by the Responsible Official (as defined at 
Sec. 1.1(b)(12)).
    (5) A general index of the records referred to in paragraph (a)(4) 
of this section.
    (b) Information made available by computer telecommunications. For 
records required to be made available for public inspection and copying 
pursuant to 5 U.S.C. 552(a)(2) (paragraphs (a)(1) through (4) of this 
section) which are created on or after November 1, 1996, as soon as 
practicable but no later than one year after such records are created, 
each bureau shall make such records available on the Internet.
    (c) Deletion of identifying details. To prevent a clearly 
unwarranted invasion of personal privacy, or pursuant to an exemption in 
5 U.S.C. 552(b), a Treasury bureau may delete information contained in 
any matter described in paragraphs (a)(1) through (4) of this section 
before making such matters available for inspection or publishing it. 
The justification for the deletion shall be explained fully in writing, 
and the extent of such deletion shall be indicated on the portion of the 
record which is made available or published, unless including that 
indication would harm an interest protected by the exemption in 5 U.S.C. 
552(b) under which the deletion is made. If technically feasible, the 
extent of the deletion shall be indicated at the place in the record 
where the deletion was made.
    (d) Public reading rooms. Each bureau of the Department of the 
Treasury shall make available for public inspection and copying, in a 
reading room or otherwise, the material described in paragraphs (a)(1) 
through (5) of this section. Fees for duplication shall be charged in 
accordance with Sec. 1.7. See the appendices to this subpart for the 
location of established bureau reading rooms.
    (e) Indexes. (1) Each bureau of the Department of the Treasury shall 
maintain and make available for public inspection and copying current 
indexes identifying any material described in paragraphs (a)(1) through 
(3) of this section. In addition, each bureau shall promptly publish, 
quarterly or more frequently, and distribute (by sale or otherwise) 
copies of each index or supplement unless the head of each bureau (or a 
delegate) determines by order published in the Federal Register that the 
publication would be unnecessary and impractical, in which case the 
bureau shall nonetheless provide copies of the index on request at a 
cost not to exceed the direct cost of duplication.
    (2) Each bureau shall make the index referred to in paragraph (a)(5) 
of this section available on the Internet by December 31, 1999.

[[Page 15]]



Sec. 1.5  Specific requests for other records.

    (a) In general. (1) Except for records made available under 5 U.S.C. 
552(a)(1) and (a)(2), but subject to the application of the exemptions 
and exclusions described in 5 U.S.C. 552(b) and (c), each bureau of the 
Department of the Treasury shall promptly make the requested records 
available to any person in conformance with 5 U.S.C. 552(a)(3). The 
request must conform in every respect with the rules and procedures of 
this subpart and the applicable bureau's appendix to this subpart. Any 
request or appeal from the initial denial of a request that does not 
comply with the requirements in this subpart will not be considered 
subject to the time constraints of paragraphs (h), (i), and (j) of this 
section, unless and until the request is amended to comply. Bureaus 
shall promptly advise the requester in what respect the request or 
appeal is deficient so that it may be amended and resubmitted for 
consideration in accordance with this subpart. If a requester does not 
respond within 30 days to a communication from a bureau to amend the 
request in order for it to be in conformance with this subpart, the 
request file will be considered closed. When the request conforms with 
the requirements of this subpart, bureaus shall make every reasonable 
effort to comply with the request within the time constraints. If the 
description of the record requested is of a type that is not maintained 
by the bureau, the requester shall be so advised and the request shall 
be returned to the requester.
    (2) This subpart applies only to records in the possession or 
control of the bureau at the time of the request. Records considered to 
be responsive to the request are those in existence on or before the 
date of receipt of the request by the appropriate bureau official. 
Requests for the continuing production of records created after the date 
of the appropriate bureau official's receipt of the request shall not be 
honored. Bureaus shall provide the responsive record or records in the 
form or format requested if the record or records are readily 
reproducible by the bureau in that form or format. Bureaus shall make 
reasonable efforts to maintain their records in forms or formats that 
are reproducible for the purpose of disclosure. For purposes of this 
section, readily reproducible means, with respect to electronic format, 
a record or records that can be downloaded or transferred intact to a 
floppy disk, compact disk (CD), tape, or other electronic medium using 
equipment currently in use by the office or offices processing the 
request. Even though some records may initially be readily reproducible, 
the need to segregate exempt from nonexempt records may cause the 
releasable material to not be readily reproducible.
    (3) Requests for information classified pursuant to Executive Order 
12958, ``Classified National Security Information,'' require the 
responsible bureau to review the information to determine whether it 
continues to warrant classification. Information which no longer 
warrants classification under the Executive Order's criteria shall be 
declassified and made available to the requester, unless the information 
is otherwise exempt from disclosure.
    (4) When a bureau receives five or more requests for substantially 
the same records, it shall place those requests in front of an existing 
request backlog that the responsible official may have. Upon completion 
of processing, the released records shall be made available in the 
bureau's public reading room, and if created on or after November 1, 
1996, shall be made available in the electronic reading room of the 
bureau's web site.
    (b) Form of request. In order to be subject to the provisions of 
this section, the following must be satisfied.
    (1) The request for records shall be made in writing, signed by the 
person making the request, and state that it is made pursuant to the 
Freedom of Information Act, 5 U.S.C. 552, or this subpart.
    (2) The request shall indicate whether the requester is a commercial 
user, an educational institution, non-commercial scientific institution, 
representative of the news media, or ``other'' requester, subject to the 
fee provisions described in Sec. 1.7. In order for the Department to 
determine the proper category for fee purposes as defined in this 
section, a request for

[[Page 16]]

records shall also state how the records released will be used. This 
information shall not be used to determine the releasibility of any 
record or records. A determination of the proper category of requester 
shall be based upon a review of the requester's submission and the 
bureau's own records. Where a bureau has reasonable cause to doubt the 
use to which a requester will put the records sought, or where that use 
is not clear from the request itself, bureaus should seek additional 
clarification before assigning the request to a specific category. The 
categories of requesters are defined as follows:
    (i) Commercial. A commercial use request refers to a request from or 
on behalf of one who seeks information for a use or purpose that 
furthers the commercial, trade, or profit interests of the requester or 
the person on whose behalf the request is made, which can include 
furthering those interests through litigation. The bureaus may determine 
from the use specified in the request that the requester is a commercial 
user.
    (ii) Educational institution. This refers to a preschool, a public 
or private elementary or secondary school, an institution of graduate 
higher education, an institution of undergraduate higher education, an 
institution of professional education, and an institution of vocational 
education, which operates a program or programs of scholarly research. 
This category does not include requesters wanting records for use in 
meeting individual academic research or study requirements.
    (iii) Non-commercial scientific institution. This refers to an 
institution that is not operated on a ``commercial'' basis as that term 
is defined in paragraph (b)(2)(i) of this section, and which is operated 
solely for the purpose of conducting scientific research, the results of 
which are not intended to promote any particular product or industry.
    (iv) Representative of the news media. This refers to any person 
actively gathering news for an entity that is organized and operated to 
publish or broadcast news to the public. The term news means information 
that is about current events or that would be of current interest to the 
public. Examples of news media entities include television or radio 
stations broadcasting to the public at large, and publishers of 
periodicals (but only in those instances when they can qualify as 
disseminators of ``news'') who make their products available for 
purchase or subscription by the general public. These examples are not 
intended to be all-inclusive. In the case of ``freelance'' journalists, 
they may be regarded as working for a news organization if they can 
demonstrate a solid basis for expecting publication through that 
organization, even though not actually employed by it. A publication 
contract would be the clearest proof, but bureaus may also look to the 
past publication record of a requester in making this determination.
    (v) ``Other'' Requester. This refers to a requester who does not 
fall within any of the previously described categories.
    (3) The request must be properly addressed to the bureau that 
maintains the record. The functions of each bureau are summarized in The 
United States Government Manual which is issued annually and is 
available from the Superintendent of Documents. Both the envelope and 
the request itself should be clearly marked ``Freedom of Information Act 
Request.'' See the appendices to this subpart for the office or officer 
to which requests shall be addressed for each bureau. A requester in 
need of guidance in defining a request or determining the proper bureau 
to which a request should be sent may contact Disclosure Services at 
202/622-0930, or may write to Disclosure Services, Department of the 
Treasury, 1500 Pennsylvania Avenue, NW, Washington, DC 20220. Requesters 
may access the ``FOIA Home Page'' at the Department of the Treasury 
World Wide Web site at: http://www.treas.gov.
    (4) The request must reasonably describe the records in accordance 
with paragraph (d) of this section.
    (5) The request must set forth the address where the person making 
the request wants to be notified about whether or not the request will 
be granted.
    (6) The request must state whether the requester wishes to inspect 
the records or desires to have a copy made

[[Page 17]]

and furnished without first inspecting them.
    (7) The request must state the firm agreement of the requester to 
pay the fees for search, duplication, and review as may ultimately be 
determined in accordance with Sec. 1.7. The agreement may state the 
upper limit (but not less than $25) that the requester is willing to pay 
for processing the request. A request that fees be waived or reduced may 
accompany the agreement to pay fees and shall be considered to the 
extent that such request is made in accordance with Sec. 1.7(d) and 
provides supporting information to be measured against the fee waiver 
standard set forth in Sec. 1.7(d)(1). The requester shall be notified in 
writing of the decision to grant or deny the fee waiver. A requester 
shall be asked to provide an agreement to pay fees when the request for 
a fee waiver or reduction is denied and the initial request for records 
does not include such agreement. If a requester has an outstanding 
balance of search, review, or duplication fees due for FOIA request 
processing, the requirements of this paragraph are not met until the 
requester has remitted the outstanding balance due.
    (c) Requests for records not in control of bureau; referrals; 
consultations. (1) When a requested record is in the possession or under 
the control of a bureau of the Department other than the office to which 
the request is addressed, the request for the record shall be 
transferred to the appropriate bureau and the requester notified. This 
referral shall not be considered a denial of access within the meaning 
of these regulations. The bureau of the Department to which this 
referral is made shall treat this request as a new request addressed to 
it and the time limits for response set forth by paragraph (h)(1) of 
this section shall begin when the referral is received by the designated 
office or officer of the bureau.
    (2) When a requested record has been created by an agency or 
Treasury bureau other than the Treasury bureau possessing the record, 
the bureau having custody of the record shall refer the record to the 
originating agency or Treasury bureau for a direct response to the 
requester. The requester shall be informed of the referral unless 
otherwise instructed by the originating agency. This is not a denial of 
a FOIA request; thus no appeal rights accrue to the requester.
    (3) When a FOIA request is received for a record created by a 
Treasury bureau that includes information originated by another bureau 
of the Department of the Treasury or another agency, the record shall be 
referred to the originating agency or bureau for review and 
recommendation on disclosure. The agency or bureau shall respond to the 
referring office. The Treasury bureau shall not release any such records 
without prior consultation with the originating bureau or agency.
    (4) In certain instances and at the discretion of the Departmental 
Offices, requests having impact on two or more bureaus of the Department 
may be coordinated by the Departmental Offices.
    (d) Reasonable description of records. The request for records must 
describe the records in reasonably sufficient detail to enable employees 
who are familiar with the subject area of the request to locate the 
records without placing an unreasonable burden upon the Department. 
Whenever possible, a request should include specific information about 
each record sought, such as the date, title or name, author, recipients, 
and subject matter of the record. If the Department determines that the 
request does not reasonably describe the records sought, the requester 
shall be given an opportunity to provide additional information. Such 
opportunity may, when necessary, involve a discussion with knowledgeable 
Department of the Treasury personnel. The reasonable description 
requirement shall not be used by officers or employees of the Department 
of the Treasury to improperly withhold records from the public.
    (e) Requests for expedited processing. (1) When a request for 
records includes a request for expedited processing, both the envelope 
and the request itself must be clearly marked, ``Expedited Processing 
Requested.''
    (2) Records will be processed as soon as practicable when a 
requester asks for expedited processing in writing and is granted such 
expedited treatment by the Department. The requester must

[[Page 18]]

demonstrate a compelling need for expedited processing of the requested 
records. A compelling need is defined as follows:
    (i) Failure to obtain the requested records on an expedited basis 
could reasonably be expected to pose an imminent threat to the life or 
physical safety of an individual. The requester shall fully explain the 
circumstances warranting such an expected threat so that the Department 
may make a reasoned determination that a delay in obtaining the 
requested records could pose such a threat; or
    (ii) With respect to a request made by a person primarily engaged in 
disseminating information, urgency to inform the public concerning 
actual or alleged Federal Government activity. A person ``primarily 
engaged in disseminating information'' does not include individuals who 
are engaged only incidentally in the dissemination of information. The 
standard of ``urgency to inform'' requires that the records requested 
pertain to a matter of current exigency to the American public and that 
delaying a response to a request for records would compromise a 
significant recognized interest to and throughout the American general 
public. The requester must adequately explain the matter or activity and 
why the records sought are necessary to be provided on an expedited 
basis.
    (3) A demonstration of a compelling need by a person making a 
request for expedited processing shall be made by a statement certified 
by the requester to be true and correct to the best of his or her 
knowledge and belief. The statement must be in the form prescribed by 28 
U.S.C. 1746, ``I declare under penalty of perjury that the foregoing is 
true and correct to the best of my knowledge and belief. Executed on 
[date].''
    (4) Upon receipt by the appropriate bureau official, a request for 
expedited processing shall be considered and a determination as to 
whether to grant or deny the request for expedited processing shall be 
made, and the requester notified, within 10 calendar days of the date of 
the request. However, in no event shall the bureau have fewer than five 
days (excluding Saturdays, Sundays, and legal public holidays) from the 
date of receipt of the request for such processing. The determination to 
grant or deny a request for expedited processing may be made solely on 
the information contained in the initial letter requesting expedited 
treatment.
    (5) Appeals of initial determinations to deny expedited processing 
must be made within 10 calendar days of the date of the initial letter 
of determination denying expedited processing. Both the envelope and the 
appeal itself shall be clearly marked, ``Appeal for Expedited 
Processing.''
    (6) An appeal determination regarding expedited processing shall be 
made, and the requester notified, within 10 days (excluding Saturdays, 
Sundays, and legal public holidays) from the date of receipt of the 
appeal.
    (f) Date of receipt of request. A request for records shall be 
considered to have been received on the date on which a complete request 
containing the information required by paragraph (b) of this section has 
been received. A determination that a request is deficient in any 
respect is not a denial of access, and such determinations are not 
subject to administrative appeal. Requests shall be stamped with the 
date of receipt by the office prescribed in the appropriate appendix. As 
soon as the date of receipt has been established, the requester shall be 
so informed and shall also be advised when to expect a response. The 
acknowledgment of receipt requirement shall not apply if a disclosure 
determination will be issued prior to the end of the 20-day time limit.
    (g) Search for record requested. Department of the Treasury 
employees shall search to identify and locate requested records, 
including records stored at Federal Records Centers. Searches for 
records maintained in electronic form or format may require the 
application of codes, queries, or other minor forms of programming to 
retrieve the requested records. Wherever reasonable, searches shall be 
done by electronic means. However, searches of electronic records are 
not required when such searches would significantly interfere with the 
operation of a Treasury automated information system or would require 
unreasonable effort to conduct. The Department of the Treasury is not 
required under 5 U.S.C. 552 to tabulate or compile information for the 
purpose

[[Page 19]]

of creating a record or records that do not exist.
    (h) Initial determination. (1) In general. The officers designated 
in the appendices to this part shall make initial determinations either 
to grant or to deny in whole or in part requests for records. Such 
officers shall respond in the approximate order of receipt of the 
requests, to the extent consistent with sound administrative practice. 
These determinations shall be made and the requester notified within 20 
days (excepting Saturdays, Sundays, and legal public holidays) after the 
date of receipt of the request, as determined in accordance with 
paragraph (f) of this section, unless the designated officer invokes an 
extension pursuant to paragraph (j)(1) of this section or the requester 
otherwise agrees to an extension of the 20-day time limitation.
    (2) Granting of request. If the request is granted in full or in 
part, and if the requester wants a copy of the records, a copy of the 
records shall be mailed to the requester, together with a statement of 
the applicable fees, either at the time of the determination or shortly 
thereafter.
    (3) Inspection of records. In the case of a request for inspection, 
the requester shall be notified in writing of the determination, when 
and where the requested records may be inspected, and of the fees 
incurred in complying with the request. The records shall then promptly 
be made available for inspection at the time and place stated, in a 
manner that will not interfere with Department of the Treasury 
operations and will not exclude other persons from making inspections. 
The requester shall not be permitted to remove the records from the room 
where inspection is made. If, after making inspection, the requester 
desires copies of all or a portion of the requested records, copies 
shall be furnished upon payment of the established fees prescribed by 
Sec. 1.7. Fees may be charged for search and review time as stated in 
Sec. 1.7.
    (4) Denial of request. If it is determined that the request for 
records should be denied in whole or in part, the requester shall be 
notified by mail. The letter of notification shall:
    (i) State the exemptions relied on in not granting the request;
    (ii) If technically feasible, indicate the amount of information 
deleted at the place in the record where such deletion is made (unless 
providing such indication would harm an interest protected by the 
exemption relied upon to deny such material);
    (iii) Set forth the name and title or position of the responsible 
official;
    (iv) Advise the requester of the right to administrative appeal in 
accordance with paragraph (i) of this section; and
    (v) Specify the official or office to which such appeal shall be 
submitted.
    (5) No records found. If it is determined, after a thorough search 
for records by the responsible official or his delegate, that no records 
have been found to exist, the responsible official will so notify the 
requester in writing. The letter of notification will advise the 
requester of the right to administratively appeal the Department's 
determination that no records exist (i.e., to challenge the adequacy of 
the Department's search for responsive records) in accordance with 
paragraph (i) of this section. The response shall specify the official 
or office to which the appeal shall be submitted for review.
    (i) Administrative appeal. (1)(i) A requester may appeal a 
Department of the Treasury initial determination when:
    (A) Access to records has been denied in whole or in part;
    (B) There has been an adverse determination of the requester's 
category as provided in Sec. 1.7(d)(4);
    (C) A request for fee waiver or reduction has been denied;
    (D) It has been determined that no responsive records exist; or
    (E) A request for expedited processing has been denied.
    (ii) An appeal, other than an appeal for expedited processing, must 
be submitted within 35 days of the date of the initial determination or 
the date of the letter transmitting the last records released, whichever 
is later, except in the case of a denial for expedited processing. An 
appeal of a denial for expedited processing must be made within 10 days 
of the date of the initial determination to deny expedited processing 
(see Sec. 1.5(e)(5)). All appeals must be submitted to the official 
specified in the

[[Page 20]]

appropriate appendix to this subpart whose title and address should also 
have been included in the initial determination. An appeal that is 
improperly addressed shall be considered not to have been received by 
the Department until the office specified in the appropriate appendix 
receives the appeal.
    (2) The appeal shall--
    (i) Be made in writing and signed by the requester or his or her 
representative;
    (ii) Be addressed to and mailed or hand delivered within 35 days (or 
within 10 days when expedited processing has been denied) of the date of 
the initial determination, or the date of the letter transmitting the 
last records released, whichever is later, to the office or officer 
specified in the appropriate appendix to this subpart and also in the 
initial determination. (See the appendices to this subpart for the 
address to which appeals made by mail should be addressed);
    (iii) Set forth the address where the requester desires to be 
notified of the determination on appeal;
    (iv) Specify the date of the initial request and date of the letter 
of initial determination, and, where possible, enclose a copy of the 
initial request and the initial determination being appealed.
    (3)(i) Appeals shall be stamped with the date of their receipt by 
the office to which addressed, and shall be processed in the approximate 
order of their receipt. The receipt of the appeal shall be acknowledged 
by the office or officer specified in the appropriate appendix to this 
subpart and the requester advised of the date the appeal was received 
and the expected date of response. The decision to affirm the initial 
determination (in whole or in part) or to grant the request for records 
shall be made and notification of the determination mailed within 20 
days (exclusive of Saturdays, Sundays, and legal public holidays) after 
the date of receipt of the appeal, unless extended pursuant to paragraph 
(j)(1) of this section. If it is decided that the initial determination 
is to be upheld (in whole or in part) the requester shall be--
    (A) Notified in writing of the denial;
    (B) Notified of the reasons for the denial, including the FOIA 
exemptions relied upon;
    (C) Notified of the name and title or position of the official 
responsible for the determination on appeal; and
    (D) Provided with a statement that judicial review of the denial is 
available in the United States District Court for the judicial district 
in which the requester resides or has a principal place of business, the 
judicial district in which the requested records are located, or the 
District of Columbia in accordance with 5 U.S.C. 552(a)(4)(B).
    (ii) If the initial determination is reversed on appeal, the 
requester shall be so notified and the request shall be processed 
promptly in accordance with the decision on appeal.
    (4) If a determination cannot be made within the 20-day period (or 
within a period of extension pursuant to paragraph (j)(1) of this 
section), the requester may be invited to agree to a voluntary extension 
of the 20-day appeal period. This voluntary extension shall not 
constitute a waiver of the right of the requester ultimately to commence 
an action in a United States district court.
    (j) Time extensions; unusual circumstances. (1) In unusual 
circumstances, the time limitations specified in paragraphs (h) and (i) 
of this section may be extended by written notice from the official 
charged with the duty of making the determination to the person making 
the request or appeal setting forth the reasons for this extension and 
the date on which the determination is expected to be sent. As used in 
this paragraph, unusual circumstances means, but only to the extent 
reasonably necessary to the proper processing of the particular 
requests:
    (i) The need to search for and collect the requested records from 
field facilities or other establishments that are separate from the 
office processing the request;
    (ii) The need to search for, collect, and appropriately examine a 
voluminous amount of separate and distinct records which are demanded in 
a single request; or
    (iii) The need for consultation, which shall be conducted with all 
practicable

[[Page 21]]

speed, with another agency having a substantial interest in the 
determination of the request, or among two or more bureaus or components 
of bureaus of the Department of the Treasury having substantial subject 
matter interest therein.
    (2) Any extension or extensions of time shall not cumulatively total 
more than 10 days (exclusive of Saturdays, Sundays, and legal public 
holidays). However, if additional time is needed to process the request, 
the bureau shall notify the requester and provide the requester an 
opportunity to limit the scope of the request or arrange for an 
alternative time frame for processing the request or a modified request. 
The requester shall retain the right to define the desired scope of the 
request, as long as it meets the requirements contained in this subpart.
    (3) Bureaus may establish multitrack processing of requests based on 
the amount of work or time, or both, involved in processing requests.
    (4) If more than one request is received from the same requester, or 
from a group of requesters acting in concert, and the Department 
believes that such requests constitute a single request which would 
otherwise satisfy the unusual circumstances specified in paragraph 
(j)(1) of this section, and the requests involve clearly related 
matters, the Department may aggregate these requests for processing 
purposes.
    (k) Failure to comply. If a bureau of the Department of the Treasury 
fails to comply with the time limits specified in paragraphs (h) or (i) 
of this section , or the time extensions of paragraph (j) of this 
section, any person making a request for records in accordance with 
Sec. 1.5 shall be considered to have exhausted administrative remedies 
with respect to the request. Accordingly, the person making the request 
may initiate suit as set forth in paragraph (l) of this section.
    (l) Judicial review. If an adverse determination is made upon appeal 
pursuant to paragraph (i) of this section, or if no determination is 
made within the time limits specified in paragraphs (h) and (i) of this 
section, together with any extension pursuant to paragraph (j)(1) of 
this section or within the time otherwise agreed to by the requester, 
the requester may commence an action in a United States district court 
in the district in which he resides, in which his principal place of 
business is located, in which the records are situated, or in the 
District of Columbia, pursuant to 5 U.S.C. 552(a)(4).
    (m) Preservation of records. Under no circumstances shall records be 
destroyed while they are the subject of a pending request, appeal, or 
lawsuit under the FOIA.
    (n) Processing requests that are not properly addressed. A request 
that is not properly addressed as specified in the appropriate appendix 
to this subpart shall be forwarded to the appropriate bureau or bureaus 
for processing. If the recipient of the request does not know the 
appropriate bureau to forward it to, the request shall be forwarded to 
the Departmental Disclosure Officer (Disclosure Services, DO), who will 
determine the appropriate bureau. A request not addressed to the 
appropriate bureau will be considered to have been received for purposes 
of paragraph (f) of this section when the request has been received by 
the appropriate bureau office as designated in the appropriate appendix 
to this subpart. An improperly addressed request, when received by the 
appropriate bureau office, shall be acknowledged by that bureau.



Sec. 1.6  Business information.

    (a) In general. Business information provided to the Department of 
the Treasury by a business submitter shall not be disclosed pursuant to 
a Freedom of Information Act request except in accordance with this 
section.
    (b) Notice to business submitters. A bureau shall provide a business 
submitter with prompt written notice of receipt of a request or appeal 
encompassing its business information whenever required in accordance 
with paragraph (c) of this section, and except as is provided in 
paragraph (g) of this section. Such written notice shall either describe 
the exact nature of the business information requested or provide copies 
of the records or portions of records containing the business 
information.
    (c) When notice is required. The bureau shall provide a business 
submitter with

[[Page 22]]

notice of receipt of a request or appeal whenever:
    (1) The business submitter has in good faith designated the 
information as commercially or financially sensitive information, or
    (2) The bureau has reason to believe that disclosure of the 
information could reasonably be expected to cause substantial 
competitive harm.
    (3) Notice of a request for business information falling within 
paragraph (c)(1) or (2) of this section shall be required for a period 
of not more than ten years after the date of submission unless the 
business submitter requests, and provides acceptable justification for, 
a specific notice period of greater duration.
    (4) The submitter's claim of confidentiality should be supported by 
a statement by an authorized representative of the company providing 
specific justification that the information in question is in fact 
confidential commercial or financial information and has not been 
disclosed to the public.
    (d) Opportunity to object to disclosure. (1) Through the notice 
described in paragraph (b) of this section, a bureau shall afford a 
business submitter ten days from the date of the notice (exclusive of 
Saturdays, Sundays, and legal public holidays) to provide the bureau 
with a detailed statement of any objection to disclosure. Such statement 
shall specify all grounds for withholding any of the information under 
any exemption of the Freedom of Information Act and, in the case of 
Exemption 4, shall demonstrate why the information is considered to be a 
trade secret or commercial or financial information that is privileged 
or confidential. Information provided by a business submitter pursuant 
to this paragraph may itself be subject to disclosure under the FOIA.
    (2) When notice is given to a submitter under this section, the 
requester shall be advised that such notice has been given to the 
submitter. The requester shall be further advised that a delay in 
responding to the request may be considered a denial of access to 
records and that the requester may proceed with an administrative appeal 
or seek judicial review, if appropriate. However, the requester will be 
invited to agree to a voluntary extension of time so that the bureau may 
review the business submitter's objection to disclose.
    (e) Notice of intent to disclose. A bureau shall consider carefully 
a business submitter's objections and specific grounds for nondisclosure 
prior to determining whether to disclose business information. Whenever 
a bureau decides to disclose business information over the objection of 
a business submitter, the bureau shall forward to the business submitter 
a written notice which shall include:
    (1) A statement of the reasons for which the business submitter's 
disclosure objections were not sustained;
    (2) A description of the business information to be disclosed; and
    (3) A specified disclosure date which is not less than ten days 
(exclusive of Saturdays, Sundays, and legal public holidays) after the 
notice of the final decision to release the requested information has 
been mailed to the submitter. Except as otherwise prohibited by law, a 
copy of the disclosure notice shall be forwarded to the requester at the 
same time.
    (f) Notice of FOIA lawsuit. Whenever a requester brings suit seeking 
to compel disclosure of business information covered by paragraph (c) of 
this section, the bureau shall promptly notify the business submitter.
    (g) Exception to notice requirement. The notice requirements of this 
section shall not apply if:
    (1) The bureau determines that the information shall not be 
disclosed;
    (2) The information lawfully has been published or otherwise made 
available to the public; or
    (3) Disclosure of the information is required by law (other than 5 
U.S.C. 552).



Sec. 1.7  Fees for services.

    (a) In general. This fee schedule is applicable uniformly throughout 
the Department of the Treasury and pertains to requests processed under 
the Freedom of Information Act. Specific levels of fees are prescribed 
for each of the following categories of requesters. Requesters are asked 
to identify the applicable fee category they belong to in

[[Page 23]]

their initial request in accordance with Sec. 1.5(b).
    (1) Commercial use requesters. These requesters are assessed charges 
which recover the full direct costs of searching for, reviewing, and 
duplicating the records sought. Commercial use requesters are not 
entitled to two hours of free search time or 100 free pages of 
duplication of documents. Moreover, when a request is received for 
disclosure that is primarily in the commercial interest of the 
requester, the Department is not required to consider a request for a 
waiver or reduction of fees based upon the assertion that disclosure 
would be in the public interest. The Department may recover the cost of 
searching for and reviewing records even if there is ultimately no 
disclosure of records, or no records are located.
    (2) Educational and Non-Commercial Scientific Institution 
Requesters. Records shall be provided to requesters in these categories 
for the cost of duplication alone, excluding charges for the first 100 
pages. To be eligible, requesters must show that the request is made 
under the auspices of a qualifying institution and that the records are 
not sought for a commercial use, but are sought in furtherance of 
scholarly (if the request is from an educational institution) or 
scientific (if the request is from a non-commercial scientific 
institution) research. These categories do not include requesters who 
want records for use in meeting individual academic research or study 
requirements.
    (3) Requesters who are Representatives of the News Media. Records 
shall be provided to requesters in this category for the cost of 
duplication alone, excluding charges for the first 100 pages.
    (4) All Other Requesters. Requesters who do not fit any of the 
categories described above shall be charged fees that will recover the 
full direct cost of searching for and duplicating records that are 
responsive to the request, except that the first 100 pages of 
duplication and the first two hours of search time shall be furnished 
without charge. The Department may recover the cost of searching for 
records even if there is ultimately no disclosure of records, or no 
records are located. Requests from persons for records about themselves 
filed in the Department's systems of records shall continue to be 
treated under the fee provisions of the Privacy Act of 1974 which permit 
fees only for duplication, after the first 100 pages are furnished free 
of charge.
    (b) Fee waiver determination. Where the initial request includes a 
request for reduction or waiver of fees, the responsible official shall 
determine whether to grant the request for reduction or waiver before 
processing the request and notify the requester of this decision. If the 
decision does not waive all fees, the responsible official shall advise 
the requester of the fact that fees shall be assessed and, if 
applicable, payment must be made in advance pursuant to Sec. 1.7(e)(2).
    (c) When fees are not charged. (1) No fee shall be charged for 
monitoring a requester's inspection of records.
    (2) Fees shall be charged in accordance with the schedule contained 
in paragraph (g) of this section for services rendered in responding to 
requests for records, unless any one of the following applies:
    (i) Services were performed without charge;
    (ii) The cost of collecting a fee would be equal to or greater than 
the fee itself; or,
    (iii) The fees were waived or reduced in accordance with paragraph 
(d) of this section.
    (d) Waiver or reduction of fees. (1) Fees may be waived or reduced 
on a case-by-case basis in accordance with this paragraph by the 
official who determines the availability of the records, provided such 
waiver or reduction has been requested in writing. Fees shall be waived 
or reduced by this official when it is determined, based upon the 
submission of the requester, that a waiver or reduction of the fees is 
in the public interest because furnishing the information is likely to 
contribute significantly to public understanding of the operations or 
activities of the government and is not primarily in the commercial 
interest of the requester. Fee waiver/reduction requests shall be 
evaluated against the fee waiver policy guidance issued by the 
Department of Justice on April 2, 1987.

[[Page 24]]

    (2) Normally no charge shall be made for providing records to state 
or foreign governments, international governmental organizations, or 
local government agencies or offices.
    (3) Appeals from denials of requests for waiver or reduction of fees 
shall be decided in accordance with the criteria set forth in paragraph 
(d)(1) of this section by the official authorized to decide appeals from 
denials of access to records. Appeals shall be addressed in writing to 
the office or officer specified in the appropriate appendix to this 
subpart within 35 days of the denial of the initial request for waiver 
or reduction and shall be decided within 20 days (excluding Saturdays, 
Sundays, and legal public holidays).
    (4) Appeals from an adverse determination of the requester's 
category as described in Sec. 1.5(b)(2) and provided in Sec. 1.5(i)(1) 
shall be decided by the official authorized to decide appeals from 
denials of access to records and shall be based upon a review of the 
requester's submission and the bureau's own records. Appeals shall be 
addressed in writing to the office or officer specified in the 
appropriate appendix to this subpart within 35 days of the date of the 
bureau's determination of the requester's category and shall be decided 
within 20 days (excluding Saturdays, Sundays, and legal public 
holidays).
    (e) Advance notice of fees. (1) When the fees for processing the 
request are estimated to exceed the limit set by the requester, and that 
amount is less than $250, the requester shall be notified of the 
estimated costs. The requester must provide an agreement to pay the 
estimated costs; however, the requester shall also be given an 
opportunity to reformulate the request in an attempt to reduce fees.
    (2) If the requester has failed to state a limit and the costs are 
estimated to exceed $250.00, the requester shall be notified of the 
estimated costs and must pre-pay such amount prior to the processing of 
the request, or provide satisfactory assurance of full payment if the 
requester has a history of prompt payment of FOIA fees. The requester 
shall also be given an opportunity to reformulate the request in such a 
way as to constitute a request for responsive records at a reduced fee.
    (3) When the Department or a bureau of the Department acts under 
paragraphs (e)(1) or (2) of this section, the administrative time limits 
of 20 days (excluding Saturdays, Sundays, and legal public holidays) 
from receipt of initial requests or appeals, plus extensions of these 
time limits, shall begin only after fees have been paid, a written 
agreement to pay fees has been provided, or a request has been 
reformulated.
    (f) Form of payment. (1) Payment may be made by check or money order 
payable to the Treasury of the United States or the relevant bureau of 
the Department of the Treasury.
    (2) The Department of the Treasury reserves the right to request 
prepayment after a request is processed and before documents are 
released.
    (3) When costs are estimated or determined to exceed $250, the 
Department shall either obtain satisfactory assurance of full payment of 
the estimated cost where the requester has a history of prompt payment 
of FOIA fees or require a requester to make an advance payment of the 
entire estimated or determined fee before continuing to process the 
request.
    (4) If a requester has previously failed to pay a fee within 30 days 
of the date of the billing, the requester shall be required to pay the 
full amount owed plus any applicable interest, and to make an advance 
payment of the full amount of the estimated fee before the Department 
begins to process a new request or the pending request. Whenever 
interest is charged, the Department shall begin assessing interest on 
the 31st day following the day on which billing was sent. Interest shall 
be at the rate prescribed in 31 U.S.C. 3717. In addition, the Department 
shall take all steps authorized by the Debt Collection Act of 1982, as 
amended by the Debt Collection Improvement Act of 1996, including 
administrative offset pursuant to 31 CFR Part 5, disclosure to consumer 
reporting agencies and use of collection agencies, to effect payment.
    (g) Amounts to be charged for specific services. The fees for 
services performed by a bureau of the Department of the Treasury shall 
be imposed and collected as set forth in this paragraph.

[[Page 25]]

    (1) Duplicating records. All requesters, except commercial 
requesters, shall receive the first 100 pages duplicated without charge. 
Absent a determination to waive fees, a bureau shall charge requesters 
as follows:
    (i) $.20 per page, up to 8\1/2\  x  14", made by photocopy or 
similar process.
    (ii) Photographs, films, and other materials--actual cost of 
duplication.
    (iii) Other types of duplication services not mentioned above--
actual cost.
    (iv) Material provided to a private contractor for copying shall be 
charged to the requester at the actual cost charged by the private 
contractor.
    (2) Search services. Bureaus shall charge for search services 
consistent with the following:
    (i) Searches for other than electronic records. The Department shall 
charge for search time at the salary rate(s) (basic pay plus 16 percent) 
of the employee(s) making the search. However, where a single class of 
personnel is used exclusively (e.g., all administrative/clerical, or all 
professional/executive), an average rate for the range of grades 
typically involved may be established. This charge shall include 
transportation of personnel and records necessary to the search at 
actual cost. Fees may be charged for search time as prescribed in 
Sec. 1.7, even if the search does not yield any responsive records, or 
if records are denied.
    (ii) Searches for electronic records. The Department shall charge 
for actual direct cost of the search, including computer search time, 
runs, and the operator's salary. The fee for computer output shall be 
actual direct costs. For requesters in the ``all other'' category, when 
the cost of the search (including the operator time and the cost of 
operating the computer to process a request) equals the equivalent 
dollar amount of two hours of the salary of the person performing the 
search (i.e., the operator), the charge for the computer search will 
begin.
    (3) Review of records. The Department shall charge commercial use 
requesters for review of records at the salary rate(s) (i.e., basic pay 
plus 16 percent) of the employee(s) making the review. However, when a 
single class of personnel is used exclusively (e.g., all administrative/
clerical, or all professional/executive), an average rate for the range 
of grades typically involved may be established. Fees may be charged for 
review time as prescribed in Sec. 1.7, even if records ultimately are 
not disclosed.
    (4) Inspection of records. Fees for all services provided shall be 
charged whether or not copies are made available to the requester for 
inspection.
    (5) Other services. Other services and materials requested which are 
not covered by this part nor required by the FOIA are chargeable at the 
actual cost to the Department. This includes, but is not limited to:
    (i) Certifying that records are true copies;
    (ii) Sending records by special methods such as express mail, etc.
    (h) Aggregating requests. When the Department or a bureau of the 
Department reasonably believes that a requester or group of requesters 
is attempting to break a request down into a series of requests for the 
purpose of evading the assessment of fees, the agency shall aggregate 
any such requests and charge accordingly.

                         Appendices to Subpart A

                    Appendix A--Departmental Offices

    1. In general. This appendix applies to the Departmental Offices as 
defined in 31 CFR 1.1(a)(1).
    2. Public reading room. The public reading room for the Departmental 
Offices is the Treasury Library. The Library is located in the Main 
Treasury Building, 1500 Pennsylvania Avenue, NW., Washington, DC 20220. 
For building security purposes, visitors are required to make an 
appointment by calling 202-622-0990.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Departmental Offices 
will be made by the head of the organizational unit having immediate 
custody of the records requested or the delegate of such official. 
Requests for records should be addressed to: Freedom of Information 
Request, DO, Assistant Director, Disclosure Services, Department of the 
Treasury, 1500 Pennsylvania Avenue, NW, Washington, DC 20220.
    4. Administrative appeal of initial determination to deny records.
    (i) Appellate determinations under 31 CFR 1.5(i) with respect to 
records of the Departmental Offices will be made by the Secretary, 
Deputy Secretary, Under Secretary,

[[Page 26]]

General Counsel, Inspector General, Treasury Inspector General for Tax 
Administration, Treasurer of the United States, or Assistant Secretary 
having jurisdiction over the organizational unit which has immediate 
custody of the records requested, or the delegate of such officer.
    (ii) Appellate determinations with respect to requests for expedited 
processing shall be made by the Deputy Assistant Secretary 
(Administration).
    (iii) Appeals should be addressed to:

Freedom of Information Appeal, DO, Assistant Director, Disclosure 
Services, Department of the Treasury, 1500 Pennsylvania Avenue, NW., 
Washington, DC 20220.

    5. Delivery of process. Service of process will be received by the 
General Counsel of the Department of the Treasury or the delegate of 
such officer and shall be delivered to the following location: General 
Counsel, Department of the Treasury, Room 3000, Main Treasury Building, 
1500 Pennsylvania Avenue, NW., Washington, DC 20220.

                  Appendix B--Internal Revenue Service

    1. In general. This appendix applies to the Internal Revenue 
Service. See also 26 CFR 601.702.
    2. Public reading room. The public reading rooms for the Internal 
Revenue Service are maintained at the following location:

                             National Office

                             Mailing Address

Freedom of Information Reading Room, PO Box 795, Ben Franklin Station, 
Washington, DC 20044

                             Walk-In Address

Room 1621, 1111 Constitution Avenue, NW., Washington, DC

                            Northeast Region

                             Mailing Address

Freedom of Information Reading Room, PO Box 5138, E:QMS:D, New York, NY 
10163

                             Walk-In Address

11th Floor, 110 W. 44th Street, New York, NY

                            Midstates Region

                             Mailing Address

Freedom of Information Reading Room, Mail Code 7000 DAL, 1100 Commerce 
Street, Dallas, TX 75242

                             Walk-In Address

10th Floor, Rm. 10B37, 1100 Commerce Street, Dallas, TX

                            Southeast Region

                             Mailing Address

401 W. Peachtree Street, NW., Stop 601D, Room 868, Atlanta, GA 30365

                             Walk-In Address

Same as mailing address

                             Western Region

                             Mailing Address

1301 Clay Street, Stop 800-S, Oakland, CA 94612

                             Walk-In Address

8th Floor, 1301 Clay Street, Oakland, CA

    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Internal Revenue 
Service, grant expedited processing, grant a fee waiver, or determine 
requester category will be made by those officials specified in 26 CFR 
601.702.
    4. Administrative appeal of initial determination to deny records. 
Appellate eterminations under 31 CFR 1.5(i) with respect to records of 
the Internal Revenue Service will be made by the Commissioner of 
Internal Revenue or the delegate of such officer. Appeals made by mail 
should be addressed to: Freedom of Information Appeal, Commissioner of 
Internal Revenue Service, c/o Ben Franklin Station, PO Box 929, 
Washington, DC 20044.
    Appeals may be delivered personally to the Assistant Chief Counsel 
(Disclosure Litigation) CC:EL:D, Office of the Chief Counsel, Internal 
Revenue Building, 1111 Constitution Avenue NW., Washington, D.C.
    5. Delivery of process. Service of process shall be effected 
consistent with Rule 4 of the Federal Rule of Civil Procedure, and 
directed to the Commissioner of Internal Revenue at the following 
address: Commissioner, Internal Revenue Service, 1111 Constitution 
Avenue NW., Washington, DC 20224. Attention: CC:EL:D.

                Appendix C--United States Customs Service

    1. In general. This appendix applies to the United States Customs 
Service.
    2. Public reading room. The public reading room for the United 
States Customs Service is maintained at the following location: United 
States Customs Service, 1300 Pennsylvania Avenue NW., Washington, DC 
20229.
    3. Requests for records. 
    (a) Headquarters--Initial determinations under 31 CFR 1.5(h) as to 
whether to grant requests for records will be made by the appropriate 
Division Director at Customs Service Headquarters having custody of or 
functional jurisdiction over the subject matter of the requested 
records. If the request relates

[[Page 27]]

to records maintained in an office which is not within a division, the 
initial determination shall be made by the individual designated for 
that purpose by the Assistant Commissioner having responsibility for 
that office. Requests may be mailed or delivered in person to: Freedom 
of Information Act, Chief, Disclosure Law Branch, U.S. Customs Service, 
1300 Pennsylvania Avenue, NW., Washington, DC 20229.
    (b) Field Offices--Initial determinations under 31 CFR 1.5(h) as to 
whether to grant requests for records maintained by the Office of 
Investigations will be made by the Special Agent in Charge in whose 
office the records are maintained. Initial determinations of records 
maintained in Customs Ports of Entry as to whether or not to grant 
requests for records will be made by the Port Director of the Customs 
Service Port having jurisdiction over the Port of Entry in which the 
records are maintained. Requests may be mailed or faxed to or delivered 
personally to the respective Special Agents in Charge or Port Directors 
of the Customs Service Ports at the following locations:

               Offices of Special Agents in Charge (SACS)

                              Atlanta--SAC

1691 Phoenix Blvd., Suite 250, Atlanta, Georgia 30349, Phone (770) 994-
2230, FAX (770) 994-2262

                              Detroit--SAC

McNamara Federal Building, 477 Michigan Avenue, Room 350, Detroit, 
Michigan 48226-2568, Phone (313) 226-3166, FAX (313) 226-6282

                             Baltimore--SAC

40 South Gay Street, 3rd Floor Baltimore, Maryland 21202, Phone (410) 
962-2620, FAX (410) 962-3469

                              El Paso--SAC

9400 Viscount Blvd., Suite 200, El Paso, Texas 79925, Phone (915) 540-
5700, FAX (915) 540-5754

                               Boston--SAC

10 Causeway Street, Room 722, Boston, MA 02222-1054, Phone (617) 565-
7400, FAX (617) 565-7422

                              Houston--SAC

4141 N. Sam Houston Pkwy, E., Houston, Texas 77032, Phone (281) 985-
0500, FAX (281) 985-0505

                              Buffalo--SAC

111 West Huron Street, Room 416, Buffalo, New York 14202, Phone (716) 
551-4375, FAX (716) 551-4379

                            Los Angeles--SAC

300 South Ferry St., Room 2037, Terminal Island, CA 90731, Phone (310) 
514-6231, FAX (310) 514-6280

                              Chicago--SAC

610 South Canal Street, Room 1001, Chicago, Illinois 60607, Phone (312) 
353-8450, FAX (312) 353-8455

                               Miami--SAC

8075 NW 53rd Street, Scranton Building, Miami, Florida 33166, Phone 
(305) 597-6030, FAX (305) 597-6227

                               Denver--SAC

115 Inverness Drive, East, Suite 300, Englewood, CO 80112-5131, Phone 
(303) 784-6480, FAX (303) 784-6490

                            New Orleans--SAC

423 Canal Street, Room 207, New Orleans, LA 70130, Phone (504) 670-2416, 
FAX (504) 589-2059

                              New York--SAC

6 World Trade Center, New York, New York 10048-0945, Phone (212) 466-
2900, FAX (212) 466-2903

                              San Juan--SAC

1, La Puntilla Street, Room 110, San Juan, PR 00901, Phone (787) 729-
6975 FAX (787) 729-6646

                            San Antonio--SAC

10127 Morocco, Suite 180, San Antonio, Texas 78216, Phone (210) 229-
4561, FAX (210) 229-4582

                              Seattle--SAC

1000--2nd Avenue, Suite 2300, Seattle, Washington, 98104, Phone (206) 
553-7531, FAX (206) 553-0826

                             San Diego--SAC

185 West ``F'' Street, Suite 600, San Diego, CA 92101, Phone (619) 557-
6850, FAX (619) 557-5109

                               Tampa--SAC

2203 North Lois Avenue, Suite 600, Tampa, Florida 33607, Phone (813) 
348-1881, FAX (813) 348-1871

                           San Francisco--SAC

1700 Montgomery Street, Suite 445, San Francisco, CA 94111, Phone (415) 
705-4070, FAX (415) 705-4065

                               Tucson--SAC

555 East River Road, Tucson, Arizona 85704, Phone (520) 670-6026, FAX 
(520) 670-6233

[[Page 28]]

                          Customs Service Ports

    Anchorage: 605 West Fourth Avenue Anchorage, AK 99501. Phone: (907) 
271-2675; FAX: (907) 271-2684.
    Minneapolis: 110 South Street Minneapolis, MN 55401. Phone: (612) 
348-1690; FAX: (612) 348-1630.
    Baltimore: 200 St. Paul Place Baltimore, MD 21202. Phone: (410) 962-
2666; FAX: (410) 962-9335.
    Mobile: 150 North Royal Street Mobile, AL 36602. Phone: (205) 441-
5106; FAX: (205) 441-6061.
    Blaine: 9901 Pacific Highway Blaine, WA 98230. Phone: (360) 332-
5771; FAX: (360) 332-4701.
    New Orleans: 423 Canal Street New Orleans, LA 70130. Phone: (504) 
589-6353; FAX: (504) 589-7305.
    Boston: 10 Causeway Street Boston, MA 02222-1059. Phone: (617) 565-
6147; FAX: (617) 565-6137.
    New York: 6 World Trade Center New York, NY 10048. Phone: (212) 466-
4444; FAX: (212) 455-2097.
    Buffalo: 111 West Huron Street Buffalo, NY 14202-22378. Phone: (716) 
551-4373; FAX: (716) 551-5011.
    New York-JFK Area: Building 77 Jamaica, NY 11430. Phone: (718) 553-
1542; FAX: (718) 553-0077.
    Champlain: 35 West Service Road Rts. 1 & 9 South Champlain, NY 
12919. Phone: (518) 298-8347; FAX: (518) 298-8314.
    New York-NY/Newark Area: Hemisphere Center, Newark, NJ 07114. Phone: 
(201) 645-3760; FAX: (201) 645-6634.
    Charleston: 200 East Bay Street Charleston, SC 29401. Phone: (803) 
727-4296; FAX: (803) 727-4043.
    Nogales: 9 North Grand Avenue Nogales, AZ 85621. Phone: (520) 287-
1410; FAX: (520) 287-1421.
    Charlotte: 1801-K Cross Beam Drive Charlotte, NC 28217. Phone: (704) 
329-6101; FAX: (704) 329-6103.
    Norfolk: 200 Granby Street Norfolk, VA 23510. Phone: (804) 441-3400; 
FAX: (804) 441-6630.
    Charlotte/Amalie: Main Post OFC-Sugar Estate St. Thomas, VI 00801. 
Phone: (809) 774-2511; FAX: (809) 776-3489.
    Pembina: PO Box 610 Pembina, ND 58271. Phone: (701) 825-6201; FAX: 
(701) 825-6473.
    Chicago: 610 South Canal Street Chicago, IL 60607. Phone: (312) 353-
6100; FAX: (312) 353-2337.
    Philadelphia: 2nd & Chestnut Streets Philadelphia, PA 19106. Phone: 
(215) 597-4605; FAX: (215) 597-2103.
    Cleveland: 56 Erieview Plaza Cleveland, OH 44114. Phone: (216) 891-
3804; FAX: (216) 891-3836.
    Portland, Oregon: 511 NW Broadway Portland, OR 97209. Phone: (503) 
326-2865; FAX: (503) 326-3511.
    Dallas/Fort Worth: PO Box 61905 Dallas/Fort Worth Airport, TX 75261. 
Phone: (972) 574-2170; FAX: (972) 574-4818.
    Providence: 49 Pavilion Avenue Providence, RI 02905. Phone: (401) 
941-6326; FAX: (401) 941-6628.
    Denver: 4735 Oakland Street Denver, CO 80239. Phone: (303) 361-0715; 
FAX: (303) 361-0722.
    San Diego: 610 West Ash Street San Diego, CA 92188. Phone: (619) 
557-6758; FAX: (619) 557-5314.
    Detroit: 477 Michigan Avenue Detroit, MI 48226. Phone: (313) 226-
3178; FAX: (313) 226-3179.
    San Francisco: 555 Battery Avenue San Francisco, CA 94111. Phone: 
(415) 744-7700; FAX: (415) 744-7710.
    Duluth: 515 West 1st Street Duluth, MN 55802-1390. Phone: (218) 720-
5201; FAX: (218) 720-5216.
    San Juan: 1 La Puntilla San Juan, PR 00901. Phone: (809) 729-6965; 
FAX: (809) 729-6978.
    El Paso: 9400 Viscount Boulevard El Paso, TX 79925. Phone: (915) 
540-5800; FAX: (915) 540-3011.
    Savannah: 1 East Bay Street Savannah, GA 31401. Phone: (912) 652-
4256; FAX: (912) 652-4435.
    Great Falls: 300 2nd Avenue South Great Falls, MT 59403. Phone: 
(406) 453-7631; FAX: (406) 453-7069.
    Seattle: 1000 2nd Avenue Seattle, WA 98104-1049. Phone: (206) 553-
0770; FAX: (206) 553-2970.
    Honolulu: 335 Merchant Street Honolulu, HI 96813. Phone: (808) 522-
8060; FAX: (808) 522-8060.
    St. Albans: P.O. Box 1490 St. Albans, VT 05478. Phone: (802) 524-
7352; FAX: (802) 527-1338.
    Houston/Galveston: 1717 East Loop Houston, TX 77029. Phone: (713) 
985-6712; FAX: (713) 985-6705.
    St. Louis: 4477 Woodson Road St. Louis, MO 63134-3716. Phone: (314) 
428-2662; FAX: (314) 428-2889.
    Laredo/Colombia: P.O. Box 3130 Laredo, TX 78044. Phone: (210) 726-
2267; FAX: (210) 726-2948.
    Tacoma: 2202 Port of Tacoma Road, Tacoma, WA 98421. Phone: (206) 
593-6336; FAX: (206) 593-6351.
    Los Angeles: 300 South Ferry Street Terminal Island, CA 90731. 
Phone: (310) 514-6001; FAX: (310) 514-6769.
    Tampa: 4430 East Adamo Drive Tampa, FL 33605. Phone: (813) 228-2381; 
FAX: (813) 225-7309.
    Miami Airport: 6601 West 25th Street Miami, FL 33102-5280. Phone: 
(305) 869-2800; FAX: (305) 869-2822.
    Washington, DC: P.O. Box 17423 Washington, DC. 20041. Phone: (703) 
318-5900; FAX: (703) 318-6706.

[[Page 29]]

    Milwaukee: P.O. Box 37260 Milwaukee, WI 53237-0260. Phone: (414) 
571-2860; FAX: (414) 762-0253.
    (c) All such requests should be conspicuously labeled on the face of 
the envelope, ``Freedom of Information Act Request'' or ``FOIA 
Request''.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) will be made by the 
Assistant Commissioner of Customs (Office of Regulations and Rulings), 
or his designee, and all such appeals should be mailed, faxed (202/927-
1873) or personally delivered to the United States Customs Service, 1300 
Pennsylvania Avenue, NW., Washington, DC 20229. If possible, a copy of 
the initial letter of determination should be attached to the appeal.
    5. Delivery of process. Service of process will be received by the 
Chief Counsel, United States Customs Service, 1300 Pennsylvania Avenue, 
NW., Washington, DC 20229.

                Appendix D--United States Secret Service

    1. In general. This appendix applies to the United States Secret 
Service.
    2. Public reading room. The United States Secret Service will 
provide a room on an ad hoc basis when necessary. Contact the Disclosure 
Officer, Room 720, 1800 G Street, NW., Washington, DC 20223 to make 
appointments.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the United States Secret 
Service will be made by the Freedom of Information and Privacy Acts 
Officer, United States Secret Service. Requests may be mailed or 
delivered in person to: Freedom of Information Act Request, FOIA and 
Privacy Acts Officer, U.S. Secret Service, Room 720, 1800 G Street, NW., 
Washington, DC 20223.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the United States Secret Service will be made by the Deputy Director, 
United States Secret Service. Appeals should be addressed to: Freedom of 
Information Appeal, Deputy Director, U.S. Secret Service, Room 800, 1800 
G Street, NW., Washington, DC 20223.
    5. Delivery of Process. Service of process will be received by the 
United States Secret Service Chief Counsel at the following address: 
Chief Counsel, U.S. Secret Service, Room 842, 1800 G Street, NW., 
Washington, DC 20223.

           Appendix E--Bureau of Alcohol, Tobacco and Firearms

    1. In general. This appendix applies to the Bureau of Alcohol, 
Tobacco and Firearms.
    2. Public reading room. The Bureau of Alcohol, Tobacco and Firearms 
will make materials available for review on an ad hoc basis when 
necessary. Contact the Chief, Disclosure Division, Bureau of Alcohol, 
Tobacco, and Firearms, 650 Massachusetts Avenue, NW., Washington, DC 
20226.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Bureau of Alcohol, 
Tobacco, and Firearms will be made by the Chief, Disclosure Division, 
Office of Assistant Director (Liaison and Public Information) or the 
delegate of such officer. Requests may be mailed or delivered in person 
to: Freedom of Information Act Request, Chief, Disclosure Division, 
Bureau of Alcohol, Tobacco, and Firearms, 650 Massachusetts Avenue, NW., 
Washington, DC 20226.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the Bureau of Alcohol, Tobacco and Firearms will be made by the 
Assistant Director, Liaison and Public Information, Bureau of Alcohol, 
Tobacco, and Firearms or the delegate of such officer.
    Appeals may be mailed or delivered in person to: Freedom of 
Information Appeal, Assistant Director, Liaison and Public Information, 
Bureau of Alcohol, Tobacco, and Firearms, 650 Massachusetts Avenue, NW., 
Washington, DC 20226.
    5. Delivery of process. Service of process will be received by the 
Director of the Bureau of Alcohol, Tobacco, and Firearms at the 
following location: Bureau of Alcohol, Tobacco, and Firearms, 650 
Massachusetts Avenue, NW., Washington, DC 20226, Attention: Chief 
Counsel.

              Appendix F--Bureau of Engraving and Printing

    1. In general. This appendix applies to the Bureau of Engraving and 
Printing.
    2. Public reading room. Contact the Disclosure Officer, 14th and C 
Streets, SW., Washington, DC 20228, to make an appointment.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Bureau of Engraving 
and Printing will be made by the Assistant to the Director. Requests may 
be mailed or delivered in person to: Freedom of Information Act Request, 
Disclosure Officer, (Assistant to the Director), Room 112-M, Bureau of 
Engraving and Printing, Washington, DC 20228.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the Bureau of Engraving and Printing will be made by the Director of the 
Bureau of Engraving and Printing or the delegate of the Director. 
Appeals may be mailed

[[Page 30]]

or delivered in person to: Freedom of Information Appeal, Director, 
Bureau of Engraving and Printing, 14th and C Streets, SW., Room 119-M, 
Washington, DC 20228.
    5. Delivery of process. Service of process will be received by the 
Chief Counsel or the delegate of such officer at the following location: 
Chief Counsel, Bureau of Engraving and Printing, 14th and C Streets, 
SW., Room 104-24 M, Washington, DC 20228.

                Appendix G--Financial Management Service

    1. In general. This appendix applies to the Financial Management 
Service.
    2. Public reading room. The public reading room for the Financial 
Management Service is maintained at the following location: Library, 
Main Treasury Building, 1500 Pennsylvania Avenue NW., Washington, DC 
20220. For building security purposes, visitors are required to make an 
appointment by calling 202/622-0990.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
whether to grant requests for records will be made by the Disclosure 
Officer, Financial Management Service. Requests may be mailed or 
delivered in person to: Freedom of Information Request, Disclosure 
Officer, Financial Management Service, 401 14th Street, SW., Washington, 
DC 20227.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) will be made by the 
Commissioner, Financial Management Service. Appeals may be mailed to: 
Freedom of Information Appeal (FOIA), Commissioner, Financial Management 
Service, 401 14th Street, SW., Washington, DC 20227.
    Appeals may be delivered personally to the Office of the 
Commissioner, Financial Management Service, 401 14th Street, SW., 
Washington, DC.
    5. Delivery of process. Service of process will be received by the 
Commissioner, Financial Management Service, and shall be delivered to: 
Commissioner, Financial Management Service, Department of the Treasury, 
401 14th Street, SW., Washington, DC 20227.

                     Appendix H--United States Mint

    1. In general. This appendix applies to the United States Mint.
    2. Public reading room. The U.S. Mint will provide a room on an ad 
hoc basis when necessary. Contact the Freedom of Information/Privacy Act 
Officer, United States Mint, Judiciary Square Building, 7th floor, 633 
3rd Street, NW., Washington, DC 20220.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the United States Mint 
will be made by the Freedom of Information/Privacy Act Officer, United 
States Mint. Requests may be mailed or delivered in person to: Freedom 
of Information Act Request, Freedom of Information/Privacy Act Officer, 
United States Mint, Judiciary Square Building, 7th Floor, 633 3rd 
Street, NW., Washington, DC 20220.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the United States Mint will be made by the Director of the Mint. Appeals 
made by mail should be addressed to: Freedom of Information Appeal, 
Director, United States Mint, Judiciary Square Building, 7th Floor, 633 
3rd Street, NW., Washington, DC 20220.
    5. Delivery of process. Service of process will be received by the 
Director of the Mint and shall be delivered to: Chief Counsel, United 
States Mint, Judiciary Square Building, 7th Floor, 633 3rd Street, NW., 
Washington, D.C. 20220.

                  Appendix I--Bureau of the Public Debt

    1. In general. This appendix applies to the Bureau of the Public 
Debt.
    2. Public reading room. The public reading room for the Bureau of 
the Public Debt is maintained at the following location: Library, Main 
Treasury Building, 1500 Pennsylvania Avenue, NW, Washington, DC 20220. 
For building security purposes, visitors are required to make an 
appointment by calling 202/622-0990.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records will be made by the 
Disclosure Officer of the Bureau of the Public Debt. Requests may be 
sent to: Freedom of Information Act Request, Disclosure Officer, Bureau 
of the Public Debt, Department of the Treasury, 999 E Street, NW., Room 
500, Washington, D.C. 20239-0001.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the Bureau of the Public Debt will be made by the Commissioner of the 
Public Debt. Appeals may be sent to: Freedom of Information Appeal, 
Commissioner of the Public Debt, Department of the Treasury, 999 E 
Street, NW., Room 500, Washington, DC 20239-0001.
    5. Delivery of process. Service of process will be received by the 
Chief Counsel, Bureau of the Public Debt, or the delegate of such 
officer, and shall be delivered to the following location: Chief 
Counsel's Office, Bureau of the Public Debt, Room 501, 999 E Street, 
NW., Washington, DC 20239-0001, or Bureau of the Public Debt, 200 Third 
Street, Room G-15, Parkersburg, WV 26106-1328.

[[Page 31]]

          Appendix J--Office of the Comptroller of the Currency

    1. In general. This appendix applies to the Office of the 
Comptroller of the Currency.
    2. Public reading room. The Office of the Comptroller of the 
Currency will make materials available through its Public Information 
Room at 250 E Street, SW., Washington, DC 20219.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Office of the 
Comptroller of the Currency will be made by the Disclosure Officer or 
the official so designated. Requests may be mailed or delivered in 
person to: Freedom of Information Act Request, Disclosure Officer, 
Communications Division, 3rd Floor, Comptroller of the Currency, 250 E 
Street, SW., Washington, DC 20219.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the Office of the Comptroller of the Currency will be made by the Chief 
Counsel or delegates of such person. Appeals made by mail should be 
addressed to: Communications Division, Comptroller of the Currency, 250 
E Street, SW., Washington, DC 20219.
    Appeals may be delivered personally to the Communications Division, 
Comptroller of the Currency, 250 E Street, SW., Washington, DC.
    5. Delivery of process. Service of process will be received by the 
Director, Litigation Division, Comptroller of the Currency, and shall be 
delivered to such officer at the following location: Litigation 
Division, Comptroller of the Currency, 250 E Street, SW., Washington, DC 
20219.

           Appendix K--Federal Law Enforcement Training Center

    1. In general. This apppendix applies to the Federal Law Enforcement 
Training Center.
    2. Public reading room. The public reading room for the Federal Law 
Enforcement Training Center is maintained at the following location: 
Library, Building 262, Federal Law Enforcement Training Center, Glynco, 
GA 31524.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records will be made by the Chief, 
Management Analysis Division, Federal Law Enforcement Training Center. 
Requests made by mail should be addressed to: Freedom of Information Act 
Request, Freedom of Information Act Officer, Federal Law Enforcement 
Training Center, Department of the Treasury, Building 94, Glynco, GA 
31524.
    Requests may be delivered personally to the Management Analysis 
Division, Federal Law Enforcement Training Center, Building 94, Glynco, 
GA.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the consolidated Federal Law Enforcement Training Center will be made by 
the Director, Federal Law Enforcement Training Center. Appeals may be 
mailed to: Freedom of Information Appeal, Federal Law Enforcement 
Training Center, Department of the Treasury, Building 94, Glynco, GA 
31524.
    5. Delivery of process. Service of process will be received by the 
Legal Counsel of the Federal Law Enforcement Training Center, or his 
delegate, and shall be delivered to such officer at the following 
location: Legal Counsel, Federal Law Enforcement Training Center, 
Department of the Treasury, Building 94, Glynco, GA 31524.

                Appendix L--Office of Thrift Supervision

    1. In general. This appendix applies to the Office of Thrift 
Supervision (OTS). OTS regulatory handbooks and other publications are 
available for sale. Information may be obtained by calling the OTS Order 
Department at 301/645-6264. OTS regulatory handbooks and other 
publications may be purchased by forwarding a request, along with a 
check to: OTS Order Department, PO Box 753, Waldorf, MD 20604 or by 
calling 301/645-6264 to pay by VISA or MASTERCARD.
    2. Public reading room. The public reading room for the Office of 
Thrift Supervision is maintained at the following location: 1700 G 
Street, NW., Washington, DC 20552.
    3. Requests for records. Initial determinations under 31 CFR 1.5(h) 
as to whether to grant requests for records of the Office of Thrift 
Supervision will be made by the Director, OTS Dissemination Branch. 
Requests for records should be addressed to: Freedom of Information 
Request, Manager, Dissemination Branch, Records Management & Information 
Policy Division, Office of Thrift Supervision, 1700 G Street, NW., 
Washington, DC 20552.
    Requests for records may be delivered in person to: Public Reference 
Room, Office of Thrift Supervision, 1700 G Street, NW., Washington, DC.
    4. Administrative appeal of initial determination to deny records. 
Appellate determinations under 31 CFR 1.5(i) with respect to records of 
the Office of Thrift Supervision will be made by the Director, Records 
Management & Information Policy, Office of Thrift Supervision, or their 
designee. Appeals made by mail should be addressed to: Freedom of 
Information Appeal, Director, Records Management & Information Policy 
Division, Office of Thrift Supervision, 1700 G Street, NW., Washington, 
DC 20552.

[[Page 32]]

    Appeals may be delivered in person to: Public Reference Room, Office 
of Thrift Supervision, 1700 G Street, NW., Washington, DC.
    5. Delivery of process. Service of process will be received by the 
Corporate Secretary of the Office of Thrift Supervision or their 
designee and shall be delivered to the following location: Corporate 
Secretary, Office of Thrift Supervision, 1700 G Street, NW., Washington, 
DC 20552.



                 Subpart B--Other Disclosure Provisions



Sec. 1.8  Scope.

    The regulations in this subpart concern access to information and 
records other than under 5 U.S.C. 552. This subpart is applicable only 
to the Departmental Offices as defined in Sec. 1.1(a) of this part and 
the United States Savings Bonds Division and the United States Secret 
Service.



Sec. 1.9  Records not to be otherwise withdrawn or disclosed.

    Except in accordance with this part, or as otherwise authorized, 
Treasury Department officers and employees are prohibited from making 
records or duplicates available to any person, not an officer or 
employee of the Department, and are prohibited from withdrawing any such 
records or duplicates from the files, possession or control of the 
Department.



Sec. 1.10  Oral information.

    (a) Officers and employees of the Department may, in response to 
requests, provide orally information contained in records of the 
Department which are determined to be available to the public. If the 
obtaining of such information requires search of the records, a written 
request and the payment of the fee for record search set forth in 
Sec. 1.6 will be required.
    (b) Information with respect to activities of the Department not a 
matter of record shall not be disclosed if the information involves 
matters exempt from disclosure under 5 U.S.C. 552 or the regulations in 
this part, or if the disclosure of such information would give the 
person requesting the information advantages not accorded to other 
citizens;



Sec. 1.11  Testimony or the production of records in a court or other proceeding.

    (a) Treasury Department officers and employees are prohibited from 
testifying or otherwise furnishing information obtained as a result of 
their official capacities or in connection with the transaction of 
public business, in compliance with a subpoena or other order or demand 
of any court or other authority without the prior approval of an officer 
authorized to determine the availability of records under these 
regulations.
    (b) Treasury Department officers and employees are prohibited from 
furnishing any record in compliance with subpoenas duces tecum or other 
order or demand of any court or other authority, without the prior 
approval of an officer authorized to determine the availability of 
records under the regulations in this part.
    (c) In court cases in which the United States or the Treasury 
Department is not a party, where the giving of testimony is desired, an 
affidavit by the litigant or the litigant's attorney, setting forth the 
information with respect to which the testimony of such officer or 
employee is desired, must be submitted before permission to testify will 
be granted. Permission to testify will, in all cases, be limited to the 
information set forth in the affidavit or to such portions thereof as 
may be deemed proper.
    (d) Where approval to testify or to furnish records in compliance 
with a subpoena, order or demand is not given the person to whom it is 
directed shall, if possible, appear in court or before the other 
authority and respectfully state his inability to comply in full with 
the subpoena, order or demand, relying for his action upon this section.



Sec. 1.12  Regulations not applicable to official request.

    The regulations in this part shall not be applicable to official 
requests of other governmental agencies or officers thereof acting in 
their official capacities, unless it appears that granting a particular 
request would be in violation of law or inimical to the public interest. 
Cases of doubt should be

[[Page 33]]

referred for decision to the supervisory official designated in 
Sec. 1.8.



                         Subpart C--Privacy Act



Sec. 1.20  Purpose and scope of regulations.

    The regulations in this subpart are issued to implement the 
provisions of the Privacy Act of 1974 (5 U.S.C. 552a). The regulations 
apply to all records which are contained in systems of records 
maintained by the Department of the Treasury and which are retrieved by 
an individual's name or personal identifier. They do not relate to those 
personnel records of Government employees, which are under the 
jurisdiction of the Office of Personnel Management to the extent such 
records are subject to regulations issued by such OPM. The regulations 
apply to all components of the Department of the Treasury. Any reference 
in this subpart to the Department or its officials, employees, or 
records shall be deemed to refer also to the components or their 
officials, employees, or records. The regulations set forth the 
requirements applicable to Department of the Treasury employees 
maintaining, collecting, using or disseminating records pertaining to 
individuals. They also set forth the procedures by which individuals may 
request notification of whether the Department of the Treasury maintains 
or has disclosed a record pertaining to them or may seek access to such 
records maintained in any nonexempt system of records, request 
correction of such records, appeal any initial adverse determination of 
any request for amendment, or may seek an accounting of disclosures of 
such records. For the convenience of interested persons, the components 
of the Department of the Treasury may reprint these regulations in their 
entirety (less any appendices not applicable to the component in 
question) in those titles of the Code of Federal Regulations which 
normally contain regulations applicable to such components. In 
connection with such republication, and at other appropriate times, 
components may issue supplementary regulations applicable only to the 
component in question, which are consistent with these regulations. In 
the event of any actual or apparent inconsistency, these Departmental 
regulations shall govern. Persons interested in the records of a 
particular component should, therefore, also consult the Code of Federal 
Regulations for any rules or regulations promulgated specifically with 
respect to that component (see Appendices to this subpart for cross 
references). The head of each component is hereby also authorized to 
substitute other appropriate officials for those designated and correct 
addresses specified in the appendix to this subpart applicable to the 
component. The components of the Department of the Treasury for the 
purposes of this subpart are:
    (a) The Departmental Offices, which include the offices of:
    (1) The Secretary of the Treasury, including immediate staff;
    (2) The Deputy Secretary of the Treasury, including immediate staff;
    (3) The Chief of Staff, including immediate staff;
    (4) The Executive Secretary and all offices reporting to such 
official, including immediate staff;
    (5) The Under Secretary of the Treasury for International Affairs 
and all offices reporting to such official, including immediate staff;
    (6) The Under Secretary of the Treasury for Domestic Finance and all 
offices reporting to such official, including immediate staff;
    (7) The Under Secretary for Enforcement and all offices reporting to 
such official, including immediate staff;
    (8) The Assistant Secretary of the Treasury for Financial 
Institutions and all offices reporting to such official, including 
immediate staff;
    (9) The Assistant Secretary of the Treasury for Economic Policy and 
all offices reporting to such official, including immediate staff;
    (10) The Fiscal Assistant Secretary and all offices reporting to 
such official, including immediate staff;
    (11) The General Counsel and all offices reporting to such official, 
including immediate staff; except legal counsel to the components listed 
in paragraphs (a)(17) and (b) through (l) of this section;
    (12) The Inspector General and all offices reporting to such 
official, including immediate staff;

[[Page 34]]

    (13) The Assistant Secretary of the Treasury for International 
Affairs and all offices reporting to such official, including immediate 
staff;
    (14) The Assistant Secretary of the Treasury for Legislative Affairs 
and Public Liaison and all offices reporting to such official, including 
immediate staff;
    (15) The Assistant Secretary of the Treasury for Management and 
Chief Financial Officer and all offices reporting to such official, 
including immediate staff;
    (16) The Assistant Secretary of the Treasury for Public Affairs and 
all offices reporting to such official, including immediate staff;
    (17) The Assistant Secretary of the Treasury for Tax Policy and all 
offices reporting to such official, including immediate staff;
    (18) The Treasurer of the United States, including immediate staff;
    (19) The Treasury Inspector General for Tax Administration and all 
offices reporting to such official, including immediate staff.
    (b) The Bureau of Alcohol, Tobacco and Firearms.
    (c) The Office of the Comptroller of the Currency.
    (d) The United States Customs Service.
    (e) The Bureau of Engraving and Printing.
    (f) The Federal Law Enforcement Training Center.
    (g) The Financial Management Service.
    (h) The Internal Revenue Service.
    (i) The United States Mint.
    (j) The Bureau of the Public Debt.
    (k) The United States Secret Service.
    (l) The Office of Thrift Supervision.
    (m) The Office of Thrift Supervision.

For purposes of this subpart, the office of the legal counsel for the 
components listed in paragraphs (b), (c), (d), (e), (f), (g), (h), (i), 
and (j) of this section are to be considered a part of such component. 
Any office, which is now in existence or may hereafter be established, 
which is not specifically listed or known to be a component of any of 
those listed above, shall be deemed a part of the Departmental Offices 
for the purpose of these regulations.

[52 FR 26305, July 14, 1987, as amended at 60 FR 31633, June 16, 1995; 
65 FR 2333, Jan. 14, 2000]



Sec. 1.21  Definitions.

    (a) The term agency means agency as defined in 5 U.S.C. 552(e);
    (b) The term individual means a citizen of the United States or an 
alien lawfully admitted for permanent residence;
    (c) The term maintain includes maintain, collect, use, or 
disseminate;
    (d) The term record means any item, collection, or grouping of 
information about an individual that is maintained by the Department of 
the Treasury or component of the Department. This includes, but is not 
limited to, the individual's education, financial transactions, medical 
history, and criminal or employment history and that contains the name, 
or an identifying number, symbol, or other identifying particular 
assigned to the individual, such as a finger or voice print or a 
photograph;
    (e) The term system of records means a group of any records under 
the control of the Department of the Treasury or any component from 
which information is retrieved by the name of the individual or by some 
identifying number, symbol, or other identifying particular assigned to 
the individual;
    (f) The term statistical record means a record in a system of 
records maintained for statistical research or reporting purposes only 
and not used in whole or part in making any determination about an 
identifiable individual, except as provided by 13 U.S.C. 8.
    (g) The term routine use means the disclosure of a record that is 
compatible with the purpose for which the record was collected;
    (h) The term component means a bureau or office of the Department of 
the Treasury as set forth in Sec. 1.20 and in the appendices to these 
regulations. (See 5 U.S.C. 552a(a).)
    (i) The term request for access means a request made pursuant to 5 
U.S.C. 552a(d)(1).

[[Page 35]]

    (j) The term request for amendment means a request made pursuant to 
5 U.S.C. 552a(d)(2).
    (k) The term request for accounting means a request made pursuant to 
5 U.S.C. 552a(c)(3).



Sec. 1.22  Requirements relating to systems of records.

    (a) In general. Subject to 5 U.S.C. 552a (j) and (k) and 
Sec. 1.23(c), each component shall, in conformance with 5 U.S.C. 552a:
    (1) Maintain in its records only such information about an 
individual as is relevant and necessary to accomplish a purpose of the 
agency required to be accomplished by the statute or by Executive order 
of the President (See 5 U.S.C. 552a(e)(1)).
    (2) Collect information to the greatest extent practicable directly 
from the subject individual when the information may result in adverse 
determinations about an individual's rights, benefits, and privileges 
under Federal programs. (See 5 U.S.C. 552a(e)(2)).
    (b) Requests for information from individuals. Subject to 5 U.S.C. 
552a(j) and Sec. 1.23(c)(1), each component of the Treasury shall inform 
each individual whom it asks to supply information, on the form which it 
uses to collect the information or on a separate form that can be 
retained by the individual:
    (1) The authority (whether granted by statute, or by Executive order 
of the President) which authorizes the solicitation of the information 
and whether disclosure of such information is mandatory or voluntary;
    (2) The principal purpose or purposes for which the information is 
intended to be used;
    (3) The routine uses which may be made of the information, as 
published pursuant to 5 U.S.C. 552a(e)(4)(D); and
    (4) The effects on such individual, if any, of not providing all or 
any part of the requested information. (See 5 U.S.C. 552a(e)(3)).
    (c) Report on new systems. Each component of the Treasury shall 
provide adequate advance notice to Congress and the Office of Management 
and Budget through the Disclosure Branch and Administration Section of 
the Office of the General Counsel of any proposal to establish or alter 
any system of records in order to permit an evaluation of the probable 
or potential effect of such proposal on the privacy and other personal 
or property rights of individuals or the disclosure of information 
relating to such individuals, and its effect on the preservation of the 
constitutional principles of federalism and separation of powers. (See 5 
U.S.C. 552a(o)).
    (d) Accurate and secure maintenance of records. Each component 
shall:
    (1) Subject to 5 U.S.C. 552a(j) and Sec. 1.23(c)(1), maintain all 
records which are used in making any determination about any individual 
with such accuracy, relevance, timeliness, and completeness as is 
reasonably necessary to assure fairness to the individual in the 
determination (see 5 U.S.C. 552a(e)(5);
    (2) Prior to disseminating any record about an individual to any 
person other than an agency, unless the dissemination is made pursuant 
to 5 U.S.C. 552 (see 31 CFR part 1, subpart A), make reasonable efforts 
to assure that such records are accurate, complete, timely, and relevant 
for Department of the Treasury purposes (see 5 U.S.C. 552a(e)(6)) and
    (3) Establish appropriate administrative, technical, and physical 
safeguards to insure the security and confidentiality of records and to 
protect against any anticipated threats or hazards to their security or 
integrity which could result in substantial harm, embarrassment, 
inconvenience, or unfairness to any individual on whom information is 
maintained. (See 5 U.S.C. 552a(e)(10)).
    (i) System managers, with the approval of the head of their offices 
within a component, shall establish administrative and physical 
controls, consistent with Department regulations, to insure the 
protection of records systems from unauthorized access or disclosure and 
from physical damage or destruction. The controls instituted shall be 
proportional to the degree of sensitivity of the records but at a 
minimum must insure that records other than those available to the 
general public under the Freedom of Information Act (5 U.S.C. 552), are 
protected from public view, that the area in which the records are 
stored is supervised during all business hours and

[[Page 36]]

physically secure during nonbusiness hours to prevent unauthorized 
personnel from obtaining access to the records. Automated systems shall 
comply with the security standards promulgated by the National Bureau of 
Standards.
    (ii) System managers, with the approval of the head of their offices 
within a component, shall adopt access restrictions to insure that only 
those individuals within the agency who have a need to have access to 
the records for the performance of their duties have access to them. 
Procedures shall also be adopted to prevent accidental access to, or 
dissemination of, records.
    (e) Prohibition against maintenance of records concerning First 
Amendment rights. No component shall maintain a record describing how 
any individual exercises rights guaranteed by the First Amendment (e.g. 
speech), unless the maintenance of such record is:
    (1) Expressly authorized by statute, or
    (2) Expressly authorized by the individual about whom the record is 
maintained, or
    (3) Pertinent to and within the scope of an authorized law 
enforcement activity. (See 5 U.S.C. 552a (e)(7))
    (f) Notification of disclosure under compulsory legal process. 
Subject to 5 U.S.C. 552a(j) and Sec. 1.23(c)(1), when records concerning 
an individual are subpoenaed by a Grand Jury, Court, or quasi-judicial 
agency, or disclosed in accordance with an ex parte court order pursuant 
to 26 U.S.C. 6103(i), the official served with the subpoena or court 
order shall make reasonable efforts to assure that notice of any 
disclosure is provided to the individual. Notice shall be provided 
within five working days of making the records available under 
compulsory legal process or, in the case of a Grand Jury subpoena or an 
ex parte order, within five days of its becoming a matter of public 
record. Notice shall be mailed to the last known address of the 
individual and shall contain the following information: the date and 
authority to which the subpoena is, or was returnable, or the date of 
and court issuing the ex parte order, the name and number of the case or 
proceeding, and the nature of the information sought and provided. 
Notice of the issuance of a subpoena or an ex parte order is not 
required if the system of records has been exempted from the notice 
requirement of 5 U.S.C. 552a (e)(8) and this section, pursuant to 5 
U.S.C. 552a (j) and Sec. 1.23 (c)(1), by a Notice of Exemption published 
in the Federal Register. (See 5 U.S.C. 552a (e)(8)).
    (g) Emergency disclosure. If information concerning an individual 
has been disclosed to any person under compelling circumstances 
affecting health or safety, the individual shall be notified at the last 
known address within 5 days of the disclosure (excluding Saturdays, 
Sundays, and legal public holidays). Notification shall include the 
following information: The nature of the information disclosed, the 
person or agency to whom it was disclosed, the date of disclosure, and 
the compelling circumstances justifying the disclosure. Notification 
shall be given by the officer who made or authorized the disclosure. 
(See 5 U.S.C. 552a (b)(8)).



Sec. 1.23  Publication in the Federal Register--Notices of systems of records, general exemptions, specific exemptions, review of all systems.

    (a) Notices of systems of records to be published in the Federal 
Register. (1) The Department shall publish a notice of the existence and 
character of all systems of records every 3 years in the Federal 
Register. An annual notice of systems of records is required to be 
published by the Office of the Federal Register in the publication 
entitled ``Privacy Act Issuances'', as specified in 5 U.S.C. 552a(f).
    (2) Minor changes to systems of records shall be published annually. 
(See paragraph (d)(8) of this section)
    (3) In addition, the Department shall publish in the Federal 
Register upon establishment or revision a notice of the existence and 
character of any new or revised systems of records. Unless otherwise 
instructed, each notice shall include:
    (i) The name and location of the system;
    (ii) The categories of individuals on whom records are maintained in 
the system;
    (iii) The categories of records maintained in the system;

[[Page 37]]

    (iv) Each routine use of the records contained in the system, 
including the categories of users and the purpose of such use;
    (v) The policies and practices of the component regarding storage, 
retrievability, access controls, retention, and disposal of the records;
    (vi) The title and business address of the Treasury official who is 
responsible for the system of records;
    (vii) The procedures of the component whereby an individual can be 
notified if the system of records contain a record pertaining to the 
individual, including reasonable times, places, and identification 
requirements.
    (viii) The procedures of the component whereby an individual can be 
notified on how to gain access to any record pertaining to such 
individual that may be contained in the system of records, and how to 
contest its content; and
    (ix) The categories of sources of records in the system. (See 5 
U.S.C. 552a(e)(4))
    (b) Notice of new or modified routine uses to be published in the 
Federal Register. At least 30 days prior to a new use or modification of 
a routine use, as published under paragraph (a)(3)(iv) of this section, 
each component shall publish in the Federal Register notice of such new 
or modified use of the information in the system and provide an 
opportunity for interested persons to submit written data, views, or 
arguments to the components. (See 5 U.S.C. 552a(e)(11))
    (c) Promulgation of rules exempting systems from certain 
requirements--(1) General exemptions. In accordance with existing 
procedures applicable to a Treasury component's issuance of regulations, 
the head of each such component may adopt rules, in accordance with the 
requirements (including general notice) of 5 U.S.C. 553 (b) (1), (2), 
and (3), (c) and (e), to exempt any system of records within the 
component from any part of 5 U.S.C. 552a and these regulations except 
subsections (b) (sec. 1.24, conditions of disclosure), (c)(1) (sec. 
1.25, keep accurate accounting of disclosures), (c)(2) (sec. 1.25, 
retain accounting for five years or life of record), (e)(4) (A) through 
(F) (paragraph (a) of this section, publication of annual notice of 
systems of records), (e)(6) (sec. 1.22(d), accuracy of records prior to 
dissemination), (e)(7) (sec. 1.22(e), maintenance of records on First 
Amendment rights), (e)(9) (sec. 1.28, establish rules of conduct), 
(e)(10) (sec. 1.22(d)(3), establish safeguards for records), (e)(11) 
(paragraph (c) of this section, publish new intended use), and (i) (sec. 
1.28(c), criminal penalties) if the systems of records maintained by the 
component which performs as its principal function any activity 
pertaining to the enforcement of criminal laws, including police efforts 
to prevent, control, or reduce crime or to apprehend criminals, and the 
activities of prosecutors, courts, correctional, probation, pardon, or 
parole authorities, and which consists of:
    (i) Information compiled for the purpose of identifying individual 
criminal offenders and alleged offenders and consisting only of 
identifying data and notations of arrests, the nature and disposition of 
criminal charges, sentencing, confinement, release, and parole, and 
probation status;
    (ii) Information compiled for the purpose of a criminal 
investigation, including reports of informants and investigators, and 
associated with an identifiable individual; or
    (iii) Reports identifiable to an individual compiled at any stage of 
the process of enforcement of the criminal laws from arrest or 
indictment through release from supervision. (See 5 U.S.C. 552a(j))
    (2) Specific exemptions. In accordance with existing procedures 
applicable to a Treasury component's issuance of regulations, the head 
of each such component may adopt rules, in accordance with the 
requirements (including general notice) of 5 U.S.C. 553 (b) (1), (2), 
and (3), (c), and (e), to exempt any system of records within the 
component from 5 U.S.C. 552a(c)(3) (sec. 1.25(c)(2), accounting of 
certain disclosures available to the individual), (d) (sec. 1.26(a), 
access to records), (e)(1) (sec. 1.22(a)(1), maintenance of information 
to accomplish purposes authorized by statute or executive order only), 
(e)(4)(G) (paragraph (a)(7) of this section, publication of procedures 
for notification), (e)(4)(H)

[[Page 38]]

(paragraph (a)(8) of this section, publication of procedures for access 
and contest), (e)(4)(I) (paragraph (a)(9) of this section, publication 
of sources of records), and (f) (sec. 1.26, promulgate rules for 
notification, access and contest), if the system of records is:
    (i) Subject to the provisions of 5 U.S.C. 552(b)(1);
    (ii) Investigatory material compiled for law enforcement purposes, 
other than material within the scope of subsection (j)(2) of 5 U.S.C. 
552a and paragraph (a)(1) of this section. If any individual is denied 
any right, privilege, or benefit that such individual would otherwise be 
entitled to by Federal law, or for which such individual would otherwise 
be eligible, as a result of the maintenance of this material, such 
material shall be provided to the individual, except to the extent that 
the disclosure of the material would reveal the identity of a source who 
furnished information to the Government under an express promise that 
the identity of the source would be held in confidence, or prior to 
September 27, 1975, under an implied promise that the identity of the 
source would be held in confidence;
    (iii) Maintained in connection with providing protective services to 
the President of the United States or other individuals pursuant to 18 
U.S.C. 3056;
    (iv) Required by statute to be maintained and used solely as 
statistical records;
    (v) Investigatory material compiled solely for the purpose of 
determining suitability, eligibility, or qualifications for Federal 
civilian employment, military service, Federal contracts, or access to 
classified information, but only to the extent that the disclosure of 
such material would reveal the identity of a source who furnished 
information to the Government under an express promise that the identity 
of the source would be held in confidence, or, prior to September 27, 
1975, under an implied promise that the identity of the source would be 
held in confidence;
    (vi) Testing or examination material used solely to determine 
individual qualifications for appointment or promotion in the Federal 
service the disclosure of which would compromise the objectivity or 
fairness of the testing or examination process; or
    (vii) Evaluation material used to determine potential for promotion 
in the armed services, but only to the extent that the disclosure of 
such material would reveal the identity of a source who furnished 
information to the Government under an express promise that the identity 
of the source would be held in confidence, or, prior to September 27, 
1975, under an implied promise that the identity of the source would be 
held in confidence.
    (3) At the time that rules under this subsection are adopted, the 
head of the component shall include in the statement required under 5 
U.S.C. 553(c) the reasons why the system of records is to be exempted 
from a provision of 5 U.S.C. 552a and this part. (See 5 U.S.C. 552a (j) 
and (k))
    (d) Review and report to OMB. The Department shall ensure that the 
following reviews are conducted as often as specified below by each of 
the components who shall be prepared to report to the Departmental 
Disclosure Branch upon request the results of such reviews and any 
corrective action taken to resolve problems uncovered. Each component 
shall:
    (1) Review every two years a random sample of the component's 
contracts that provide for the maintenance of a system of records on 
behalf of the component to accomplish a function of the component, in 
order to ensure that the working of each contract makes the provisions 
of the Act apply. (5 U.S.C. 552a(m)(1))
    (2) Review annually component's recordkeeping and disposal policies 
and practices in order to assure compliance with the Act.
    (3) Review routine use disclosures every 3 years, that are 
associated with each system of records in order to ensure that the 
recipient's use of such records continues to be compatible with the 
purpose for which the disclosing agency originally collected the 
information.
    (4) Review every three years each system of records for which the 
component has issued exemption rules pursuant to section (j) or (k) of 
the Privacy Act in order to determine whether the exemption is needed.

[[Page 39]]

    (5) Review annually each ongoing matching program in which the 
component has participated during the year, either as a source or as a 
matching agency in order to assure that the requirements of the Act, the 
OMB Matching Guidelines, and the OMB Model Control System and checklist 
have been met.
    (6) Review component's training practices annually to ensure that 
all component personnel are familiar with the requirements of the Act, 
these regulations and Departmental directives.
    (7) Review annually the actions of component personnel that have 
resulted either in the agency being found civilly liable under section 
(g) of the Act, or an employee being found criminally liable under the 
provisions of section (i) of the Act, in order to determine the extent 
of the problem and to prevent future recurrences.
    (8) Review annually each system of records notice to ensure that it 
accurately describes the system. Where minor changes are needed, publish 
an amended notice in the Federal Register. Minor changes shall be 
consolidated in one annual comprehensive publication. The term ``minor 
change to a system of records'' means a change that does not 
significantly change the system. More specifically, a minor change does 
not affect the character or purpose of the system and does not affect 
the ability of an individual to gain access to a record about the 
individual or to any information pertaining to such individual which is 
contained in the system; for example, changing the title of the system 
manager or the location of the system.



Sec. 1.24  Disclosure of records to person other than the individual to whom they pertain.

    (a) Conditions of disclosure. No component of Treasury shall 
disclose any record which is contained in a system of records maintained 
by it by any means of communication to any person, or to another agency, 
except pursuant to a written request by, or with the prior written 
consent of, the individual to whom the record pertains, or the parent, 
if a minor, or legal guardian, if incompetent, of such individual, 
unless disclosure of the record would be:
    (1) To those offices and employees of the Department of the Treasury 
who have a need for the record in the performance of their duties;
    (2) Retired under 5 U.S.C. 552 (subpart A of this part);
    (3) For a routine use as defined in 5 U.S.C. 552a(a)(7) and 
Sec. 1.21(g) and as described under 5 U.S.C. 552a(e)(4)(D) and 
Sec. 1.23(a)(4);
    (4) To the Bureau of the Census for purposes of planning or carrying 
out a census or survey or related activity pursuant to the provisions of 
title 13 of the U.S. Code;
    (5) To a recipient who has provided the component with advance 
adequate written assurance that the record will be used solely as a 
statistical research or reporting record, and the record is to be 
transferred in a form that is not individually identifiable;
    (6) To the National Archives of the United States as a record which 
has sufficient historical or other value to warrant its continued 
preservation by the United States Government, or for evaluation by the 
Administrator of General Services or the designee of such official to 
determine whether the record has such value;
    (7) To another agency or to an instrumentality of any governmental 
jurisdiction within or under the control of the United States for a 
civil or criminal law enforcement activity.
    (i) If the activity is authorized by law; and
    (ii) If the head of the agency or instrumentality has made a written 
request to the Department of the Treasury specifying the particular 
portion desired and the law enforcement activities for which the record 
is sought;
    (8) To a person pursuant to a showing of compelling circumstances 
affecting the health or safety of an individual, if upon such 
disclosure, notification is transmitted to the last known address of 
such individual;
    (9) To either House of Congress, or, to the extent of matter within 
its jurisdiction, any committee or subcommittee thereof, any joint 
committee of Congress or subcommittee of any such joint committee.

[[Page 40]]

    (10) To the Comptroller General, or the authorized representatives 
of such official, in the course of the performance of the duties of the 
General Accounting Office; or
    (11) Pursuant to the order of a court of competent jurisdiction. 
(See 5 U.S.C. 552a(b))



Sec. 1.25  Accounting of disclosures.

    (a) Accounting of certain disclosures. Each component, with respect 
to each system of records under its control, shall:
    (1) Keep an accurate accounting of: (i) The date, nature, and 
purpose of each disclosure of a record to any person or to an agency 
made under 5 U.S.C. 552a (b) and Sec. 1.24; and (ii) the name and 
address of the person or agency to whom the disclosure is made;
    (2) Retain the accounting made under paragraph (a)(1) of this 
section for at least five years or the life of the record, whichever is 
longer, after the disclosure for which the accounting is made; and
    (3) Inform any person or other agency about any correction or 
notation of dispute made by the constitutent unit in accordance with 5 
U.S.C. 552a (d) and Sec. 1.28 of any record that has been disclosed to 
the person or agency if an accounting of the disclosure was made. (See 5 
U.S.C. 552(c).)
    (b) Accounting systems. To permit the accounting required by 
paragraph (a) of this section, system managers, with the approval of the 
head of their offices within a component, shall establish or implement, 
a system of accounting for all disclosures of records, either orally or 
in writing, made outside the Department of the Treasury. Accounting 
records shall:
    (1) Be established in the least expensive and most convenient form 
that will permit the system manager to advise individuals, promptly upon 
request, what records concerning them have been disclosed and to whom:
    (2) Provide, as a minimum, the identification of the particular 
record disclosed, the name and address of the person or agency to whom 
or to whom or to which disclosed, and the date, nature and purpose of 
the disclosure; and
    (3) Be maintained for 5 years or until the record is destroyed or 
transferred to the National Archives and Records Service for storage in 
records centers, in which event, the accounting pertaining to those 
records, unless maintained separately, shall be transferred with the 
records themselves.
    (c) Exemptions from accounting requirements. No accounting is 
required for disclosure of records:
    (1) To those officers and employees of the Department of the 
Treasury who have a need for the record in the performance of their 
duties; or
    (2) If disclosure would be required under 5 U.S.C. 552 and Subpart A 
of this part.
    (d) Access to accounting by individual. (1) Subject to paragraphs 
(c) and (d)(2) of this section, each component shall establish and set 
forth in the appendix to this subpart applicable to the component, 
procedures for making the accounting required under paragraph (a) of 
this section available to the individual to whom the record pertains and 
shall thereafter make such accounting available in accordance therewith 
at the request of the individual. The procedures may require the 
requester to provide reasonable identification.
    (2) Access accountings of disclosure may be withheld from the 
individual named in the record only if the disclosures were (i) made 
under 5 U.S.C. 552a (b)(7) and Sec. 1.24 (a)(7), or (ii) under a system 
of records exempted from the requirements of 5 U.S.C. 552a(c)(3) in 
accordance with 5 U.S.C. 552 (j) or (k) and Sec. 1.23(c). (See 5 U.S.C. 
552a(c))



Sec. 1.26  Procedures for notification and access to records pertaining to individuals--format and fees for request for access.

    (a) Procedures for notification and access. Each component shall 
establish, in accordance with the requirements of 5 U.S.C. 553, and set 
forth in the appendix to this subpart applicable to such component 
procedures whereby an individual can be notified, in response to a 
request, if any system of records named by the individual contains a 
record pertaining to that individual. In addition, such procedures shall 
set forth the requirements for access to such records. As a minimum such 
procedures shall specify the times during, and the places at which 
access will be

[[Page 41]]

accorded, together with such identification as may be required of the 
individual before access. (See 5 U.S.C. 552a(f) (1), (2) and (3))
    (b) Access. Each component in accordance with the procedures 
prescribed under paragraph (a) of this section, shall allow an 
individual to gain access to records or to any information pertaining to 
such individual which is contained in the system of records upon 
request. The individual shall be permitted to review the record and have 
a copy made of all or any portion of the record in a form that is 
comprehensible. The individual will also be permitted to be accompanied 
by any person of the individual's choosing to review the record, except 
that the agency may require the individual to furnish a written 
statement authorizing discussion of that individual's record in the 
accompanying person's presence. (See 5 U.S.C. 552a(d)(1))
    (c) Exceptions. Neither the procedures prescribed under paragraph 
(a) of this section nor the requirements for access under paragraph (b) 
of this section shall be applicable to--(1) systems of records exempted 
pursuant to 5 U.S.C. 552a (j) and (k) and Sec. 1.23(c); (2) information 
compiled in reasonable anticipation of a civil action or proceeding (See 
5 U.S.C. 552(d)(5)); or (3) information pertaining to an individual 
which is contained in, and inseparable from, another individual's 
record.
    (d) Format of request. (1) A record for notification of whether a 
record exists shall:
    (i) Be made in writing and signed by the person making the request, 
who must be the individual about whom the record is maintained, or such 
individual's duly authorized representative (See Sec. 1.34);
    (ii) State that it is made pursuant to the Privacy Act, 5 U.S.C. 
552a or these regulations, have marked ``Privacy Act Request'' on the 
request and on the envelope;
    (iii) Give the name of the system or subsystem or categories of 
records to which access is sought, as specified in ``Privacy Act 
Issuances'' published by the Office of the Federal Register and 
referenced in the appendices to this subpart;
    (iv) Describe the nature of the record(s) sought in sufficient 
detail to enable Department personnel to locate the system of records 
containing the record with a reasonable amount of effort. Whenever 
possible, a request for access should describe the nature of the record 
sought, the date of the record or the period in which the record was 
compiled.
    (v) Provide such identification of the requester as may be specified 
in the appropriate appendix to this subpart; and
    (vi) Be addressed or delivered in person to the office or officer of 
the component indicated for the particular system or subsystem or 
categories of records the individual wishes access to, as specified in 
``Privacy Act Issuances'' published by the Office of the Federal 
Register and referenced in the appendices to this subpart. Assistance in 
ascertaining the appropriate component or in preparing a request for 
notification may be obtained by a written request to this effect 
addressed as specified in Appendix A of this part, as the address for 
the Departmental Offices for ``Request for notification and access to 
records and accountings of disclosures''.
    (2) A request for access to records shall, in addition to complying 
with paragraph (a)(1)(i) through (vi) of this section:
    (i) State whether the requester wishes to inspect the records or 
desires to have a copy made and furnished without first inspecting them;
    (ii) If the requester desires to have a copy made, state the firm 
agreement of the requester to pay the fees for duplication ultimately 
determined in accordance with (31 CFR 1.6) Subpart A of this title, 
unless such fees are waived pursuant to that section by the system 
manager or other appropriate official as indicated in the appropriate 
appendix to these regulations; and
    (iii) Comply with any other requirement set forth in the applicable 
appendix to this subpart or the ``Notice of Records Systems'' applicable 
to the system in question. Requesters are hereby advised that any 
request for access which does not comply with the foregoing requirements 
and those set forth elsewhere in this Subpart C, will

[[Page 42]]

not be deemed subject to the time constraints of this section, unless 
and until amended so as to comply. However, components shall advise the 
requester in what respect the request is deficient so that it may be 
processed. This section applies only to records which are contained in a 
system of records and which are in the possession or control of the 
component. (See 5 U.S.C. 552a (d) and (f))
    (e) Requests for records not in control of component. (1) Treasury 
employees shall make reasonable efforts to assist an oral requester to 
ascertain to which office or officer a written request should be sent. 
When the request is for a record which is not in the possession or 
control of any component of the Department of the Treasury, the 
requester shall be so advised.
    (2) Where the record requested was created by a Department or agency 
other than the Department of the Treasury or a component of the 
Department and has been classified (e.g. National Defense or 
Intelligence Information) or otherwise restrictively endorsed (e.g. 
Office of Personnel Management records of FBI reports) by such other 
Department or agency, and a copy is in the possession of a component of 
the Department of the Treasury, that portion of the request shall be 
referred to the originating agency for determination as to all issues in 
accordance with the Privacy Act. In the case of a referral to another 
agency under this paragraph, the requester shall be notified that such 
portion of the request has been so referred and that the requester may 
expect to hear from that agency.
    (3) When information sought from a system manager or other 
appropriate official in the Department of the Treasury includes 
information furnished by other Federal agencies not classified or 
otherwise restrictively endorsed, the system manager or other 
appropriate official receiving the request shall consult with the 
appropriate agency prior to making a decision to disclose or not to 
disclose the record. The decision as to whether the record shall be 
disclosed shall be made, in the first instance by the system manager or 
other appropriate official maintaining the record. (See 5 U.S.C. 552a 
(d) and (f))
    (f) Date of receipt of request. A request for notification or access 
to records shall be considered to have been received for purposes of 
this subpart on the date on which the requirements of paragraph (d) of 
this section have been satisfied. Requests for notification or access to 
records and any separate agreement to pay shall be stamped or endorsed 
with the date of receipt by the receiving office. The latest of such 
stamped dates will be deemed to be the date of receipt of the request 
for the purposes of this subpart. (See 5 U.S.C. 552a (d) and (f))
    (g) Notification of determination--(1) In general. Notification of 
determinations as to notification of whether a record exists or as to 
whether to grant access to records requested will be made by the 
officers designated in the appendices to this subpart. The notification 
of the determination shall be mailed within 30 days (excluding 
Saturdays, Sundays and legal public holidays) after the date of receipt 
of the request, as determined in accordance with paragraph (f) of this 
section. If it is not possible to respond within 30 days, the designated 
officer shall inform the requester, stating the reason for the delay 
(e.g. volume of records requested, scattered location of the records, 
need to consult other agencies, or the difficulty of the legal issues 
involved) and when a response will be dispatched. (See 5 U.S.C. 552a (d) 
and (f))
    (2) Granting of access. When it has been determined that the request 
for access will be granted--(i) and a copy requested; such copy in a 
form comprehensible to the requester shall be furnished promptly, 
together with a statement of the applicable fees for duplication; and 
(ii) and the right to inspect has been requested, the requester shall be 
promptly notified in writing of the determination, and when and where 
the requested records may be inspected. An individual seeking to inspect 
such records may be accompanied by another person of such individual's 
choosing. The individual seeking access shall be required to sign the 
required form indicating that the Department of the Treasury is 
authorized to discuss the contents of the subject

[[Page 43]]

record in the accompanying person's presence. If, after making the 
inspection, the individual making the request desires a copy of all or a 
portion of the requested records, such copy in a form comprehensible to 
the individual shall be furnished upon payment of the applicable fees 
for duplication. Fees to be charged are as prescribed by 31 CFR part 1, 
Subpart A, Sec. 1.6 Fees shall not be charged where they would amount, 
in the aggregate, to less than $3.00. (See 5 U.S.C. 552a (d) and (f))
    (3) Requirements for access to medical records. When access is 
requested to medical records, including psychological records, the 
responsible official may determine that such release could have an 
adverse effect on the individual and that release will be made only to a 
physician authorized in writing to have access to such records by the 
individual making the request. Upon receipt of the authorization the 
physician will be permitted to review the records or to receive copies 
of the records by mail, upon proper verification of identity. (See 5 
U.S.C. 552a (f) (3))
    (4) Denial of request. When it is determined that the request for 
notification of whether a record exists or access to records will be 
denied (whether in whole or part or subject to conditions or 
exceptions), the person making the request shall be so notified by mail 
in accordance with paragraph (g)(1) of this section. The letter of 
notification shall specify the city or other location where the 
requested records are situated (if known), contain a statement of the 
reasons for not granting the request as made, set forth the name and 
title or position of the responsible official and advise the individual 
making the request of the right to file suit in accordance with 5 U.S.C. 
552a (g)(1)(B).
    (5) Prohibition against the use of 5 U.S.C. 552 (b) exemptions. 
Exemptions from disclosure under 5 U.S.C. 552 (b) (31 CFR part 1, 
Subpart A, Sec. 1.2 (c)), may not be invoked for the purpose of 
withholding from an individual any record which is otherwise accessible 
to such individual under the Privacy Act, 5 U.S.C. 552a and this 
subpart. (See 5 U.S.C. 552a (q))
    (6) Records exempt in whole or in part. (i) When an individual 
requests notification as to whether a record exists or access to records 
concerning the individual which have been exempted from individual 
access pursuant to 5 U.S.C. 552a (j) or which have been compiled in 
reasonable anticipation of a civil action or proceeding in either a 
court or before an administrative tribunal and the assertion of the 
exemption is deemed necessary, the Department of the Treasury will 
neither confirm nor deny the existence of the record but shall advise 
the individual only that no record available to the individual pursuant 
to the Privacy Act of 1974 has been identified.
    (ii) Requests from individuals for access to records which have been 
exempted from access pursuant to 5 U.S.C. 552a (k) shall be processed as 
follows:
    (A) Requests for information classified pursuant to Executive Order 
11652 require the responsible component of the Department to review the 
information to determine whether it continues to warrant classification 
under the criteria of sections 1 and 5 (B), (C), (D) and (E) of the 
Executive order. Information which no longer warrants classification 
under these criteria shall be declassified and made available to the 
individual. If the information continues to warrant classification, the 
individual shall be advised that the information sought is classified, 
that it has been reviewed and continues to warrant classification, and 
that it has been exempted from access pursuant to 5 U.S.C. 552 (b)(1) 
and 5 U.S.C. 552a (k)(1). Information which has been exempted pursuant 
to 5 U.S.C. 552a (j) and which is also classified shall be reviewed as 
required by this paragraph but the response to the individual shall be 
in the form prescribed by paragraph (g)(6)(i) of this section.
    (B) Requests for information which has been exempted from disclosure 
pursuant to 5 U.S.C. 552a (k)(2) shall be responded to in the manner 
provided in paragraph (g)(6)(i) of this section unless the requester 
shows that the information has been used or is being used to deny the 
individual any right, privilege or benefit for which he is eligible or 
to which he would otherwise be entitled under federal law. In that 
event, the individual shall be advised of the

[[Page 44]]

existence of the information but such information as would identify a 
confidential source shall be extracted or summarized in a manner which 
protects the source to the maximum degree possible and the summary 
extract shall be provided to the requesting individual.
    (C) Information compiled as part of an employee background 
investigation which has been exempted pursuant to 5 U.S.C. 552a (k)(5) 
shall be made available to an individual upon request except to the 
extent that it identifies the confidential source. Material identifying 
the confidential sources shall be extracted or summarized in a manner 
which protects the source to the maximum degree possible and the summary 
or extract shall be provided to the requesting individual.
    (D) Testing or examination material which has been exempted pursuant 
to 5 U.S.C. 552a (k)(6) shall not be made available to an individual if 
disclosure would compromise the objectivity or fairness of the testing 
or examination process; but may be made available if no such compromise 
possibility exists. (See 5 U.S.C. 552a (d)(5), (j) and (k)).



Sec. 1.27  Procedures for amendment of records pertaining to individuals--format, agency review and appeal from initial adverse agency determination.

    (a) In general. Subject to the application of exemptions promulgated 
by the head of each component, in accordance with Sec. 1.23(c), and 
subject to Sec. 1.27(f), each component of the Department of the 
Treasury, shall in conformance with 5 U.S.C. 552a(d)(2), permit an 
individual to request amendment of a record pertaining to such 
individual. Any request for amendment of records or any appeal that does 
not fully comply with the requirements of this section and any 
additional specific requirements imposed by the component in the 
applicable appendix to this subpart will not be deemed subject to the 
time constraints of paragraph (e) of this section, unless and until 
amended so as to comply. However, components shall advise the requester 
in what respect the request or appeal is deficient so that it may be 
resubmitted or amended. (See 5 U.S.C. 552a (d) and (f))
    (b) Form of request to amend records. In order to be subject to the 
provisions of this section, a request to amend records shall:
    (1) Be made in writing and signed by the person making the request, 
who must be the individual about whom the record is maintained, or the 
duly authorized representative of such individual;
    (2) State that it is made pursuant to the Privacy Act, 5 U.S.C. 552a 
or these regulations, have marked ``Privacy Act Amendment Request'' on 
the request and on the envelope;
    (3) Be addressed to the office or officer of the component specified 
for such purposes in ``Privacy Act Issuances'' published by the Office 
of the Federal Register and referenced in the appendices to this subpart 
for that purpose; and
    (4) Reasonably describe the records which the individual desires to 
have amended, including, to the best of the requester's knowledge, dates 
of letters requesting access to such records previously and dates of 
letters in which notification concerning access was made, if any, and 
the individual's documentation justifying the correction. (See U.S.C. 
552a (d) and (f))
    (c) Date of receipt of request. A request for amendment of records 
pertaining to an individual shall be deemed to have been received for 
purposes of this subpart when the requirements of paragraph (b) of this 
section have been satisfied. The receiving office or officer shall stamp 
or otherwise endorse the date of receipt of the request. (See 5 U.S.C. 
552a (d) and (f))
    (d) Review of requests to amend records. Officials responsible for 
review of requests to amend records pertaining to an individual, as 
specified in the appropriate appendix to this subpart, shall:
    (1) Not later than 10 days (excluding Saturdays, Sundays, and legal 
public holidays) after the date of receipt of such request, acknowledge 
in writing such receipt; and
    (2) Promptly, either--(i) Make any correction of any portion which 
the individual believes and the official agrees is not accurate, 
relevant, timely, or complete; or

[[Page 45]]

    (ii) Inform the individual of the refusal to amend the record in 
accordance with the individual's request, the reason for the refusal, 
and the name and business address of the officer designated in the 
applicable appendix to this subpart, as the person who is to review such 
refusal. (See 5 U.S.C. 552a (d) and (f))
    (e) Administrative appeal--(1) In general. Each component shall 
permit individuals to request a review of initial decisions made under 
paragraph (d) of this section, when an individual disagrees with a 
refusal to amend this record. (See 5 U.S.C. 552a (d), (f), and (g)(1))
    (2) Form of request for administrative review of refusal to amend 
record. At any time within 35 days after the date of the notification of 
the initial decision described in paragraph (d)(2)(ii) of this section, 
the requester may submit an administrative appeal from such refusal to 
the official specified in the notification of the initial decision and 
the appropriate appendix to this subpart. The appeal shall:
    (i) Be made in writing stating any arguments in support thereof and 
be signed by the person to whom the record pertains, or the duly 
authorized representative of such official;
    (ii) Be addressed to and mailed or hand delivered within 35 days of 
the date of the initial decision, to the office or officer specified in 
the appropriate appendix to this subpart and in the notification. (See 
the appendices to this subpart for the address to which appeals made by 
mail should be addressed);
    (iii) Have clearly marked on the appeal and on the envelope, 
``Privacy Act Amendment Appeal'';
    (iv) Reasonably describe the records requested to be amended; and
    (v) Specify the date of the initial request, to amend records, and 
the date of the letter giving notification that the request was denied. 
(See 5 U.S.C. 552a (d) and (f))
    (3) Date of receipt. Appeals shall be promptly stamped with the date 
of their receipt by the office to which addressed and such stamped date 
will be deemed to be the date of receipt for all purposes of this 
subpart. The receipt of the appeal shall be acknowledged within 10 days 
(excluding Saturdays, Sundays, and legal public holidays) from the date 
of the receipt (unless the determination on appeal is dispatched in 10 
days, in which case, no acknowledgement is required) by the responsible 
official and the requester advised of the date of receipt established by 
the foregoing and when a response is due in accordance with this 
paragraph. (See 5 U.S.C. 552a (d) and (f))
    (4) Review of administrative appeals from denial of requests to 
amend records. Officials responsible for deciding administrative appeals 
from denials of requests to amend records pertaining to an individual, 
as specified in the appendices to this subpart shall: Complete the 
review, and notify the requester of the final agency decision within 30 
days (exclusive of Saturdays, Sundays and legal public holidays) after 
the date of receipt of such appeal, unless the time is extended by the 
head of the agency or the delegate of such official, for good cause 
shown. If such final agency decision is to refuse to amend the record, 
in whole or in part, the requester shall also be advised of the right--
(i) to file a concise ``Statement of Disagreement'' setting forth the 
reasons for his disagreement with the decision which shall be filed 
within 35 days of the date of the notification of the final agency 
decision and (ii) to judicial review of the final agency decision under 
5 U.S.C. 552a(g)(1)(A). (See 5 U.S.C. 552a (d), (f) and (g)(1))
    (5) Notation on record and distribution of statements of 
disagreement. The system manager is responsible, in any disclosure 
containing information about which an individual has filed a ``Statement 
of Disagreement'', occurring after the filing of the statement under 
paragraph (e)(4) of this section, for clearly noting any portion of the 
record which is disputed and providing copies of the statement and, if 
deemed appropriate, a concise statement of the component's reasons for 
not making the amendments requested to persons or other agencies to whom 
the disputed record has been disclosed. (See 5 U.S.C. 552a(d)(4))
    (f) Records not subject to correction under the Privacy Act. The 
following records are not subject to correction or amendment by 
individuals:

[[Page 46]]

    (1) Transcripts or written statements made under oath; and
    (2) Transcripts of Grand Jury proceedings, judicial or quasi-
judicial proceedings which form the official record of those 
proceedings; and
    (3) Pre-sentence reports comprising the property of the courts but 
maintained in agency files; and
    (4) Records pertaining to the determination, the collection and the 
payment of the Federal taxes; and
    (5) Records duly exempted from correction by notice published in the 
Federal Register; and
    (6) Records compiled in reasonable anticipation of a civil action or 
proceeding.



Sec. 1.28  Training, rules of conduct, penalties for non-compliance.

    (a) Training. Subject to policy guidance and regulations issued by 
the Deputy Secretary, who has Departmentwide responsibility therefor, 
each component shall institute a training program to instruct employees 
and employees of Government contractors covered by 5 U.S.C. 552a(m), who 
are involved in the design, development, operation or maintenance of any 
system of records, on a continuing basis with respect to the duties and 
responsibilities imposed on them and the rights conferred on individuals 
by the Privacy Act, the regulations in this subpart, including the 
appendices thereto, and any other related regulations. Such training 
shall provide suitable emphasis on the civil and criminal penalties 
imposed on the Department and the individual employees by the Privacy 
Act for non-compliance with specified requirements of the Act as 
implemented by the regulations in this subpart. (See 5 U.S.C. 
552a(e)(9))
    (b) Rules of conduct. In addition, to the Standards of Conduct 
published in part O of this title, particularly 31 CFR 0.735-44, the 
following are applicable to employees of the Department of the Treasury 
(including, to the extent required by the contract or 5 U.S.C. 552a(m), 
Government contractors and employees of such contractors), who are 
involved in the design, development, operation or maintenance of any 
system of records, or in maintaining any records, for or on behalf of 
the Department, including any component thereof.
    (1) The head of each office of a component of the Department shall 
be responsible for assuring that employees subject to such official's 
supervision are advised of the provisions of the Privacy Act, including 
the criminal penalties and civil liabilities provided therein, and the 
regulations in this subpart, and that such employees are made aware of 
their individual and collective responsibilities to protect the security 
of personal information, to assure its accuracy, relevance, timeliness 
and completeness, to avoid unauthorized disclosure either orally or in 
writing, and to insure that no information system concerning 
individuals, no matter how small or specialized is maintained without 
public notice.
    (2) Employees of the Department of the Treasury involved in the 
design, development, operation, or maintenance of any system of records, 
or in maintaining any record shall:
    (i) Collect no information of a personal nature from individuals 
unless authorized to collect it to achieve a function or carry out a 
responsibility of the Department;
    (ii) Collect from individuals only that information which is 
necessary to Department functions or responsibilities, unless related to 
a system exempted under 5 U.S.C. 552a (j) or (k):
    (iii) Collect information, wherever possible, directly from the 
individual to whom it relates, unless related to a system exempted under 
5 U.S.C. 552a(j);
    (iv) Inform individuals from whom information is collected about 
themselves of the authority for collection, the purposes thereof, the 
use that will be made of the information, and the effects, both legal 
and practical, of not furnishing the information. (While this provision 
does not explicitly require it, where feasible, third party sources 
should be informed of the purposes for which information they are asked 
to provide will be used.);
    (v) Neither collect, maintain, use nor disseminate information 
concerning an individual's religious or political beliefs or activities 
or membership in associations or organizations, unless (A)

[[Page 47]]

the individual has volunteered such information for the individual's own 
benefits; (B) the information is expressly authorized by statute to be 
collected, maintained, used or disseminated; or (C) the activities 
involved are pertinent to and within the scope of an authorized 
investigation, adjudication or correctional activity;
    (vi) Advise their supervisors of the existence or contemplated 
development of any record system which is capable of retrieving 
information about individuals by individual identifier;
    (vii) Disseminate no information concerning individuals outside the 
Department except when authorized by 5 U.S.C. 552a or pursuant to a 
routine use published in the Federal Register;
    (viii) Assure that an accounting is kept in the prescribed form, of 
all dissemination of personal information outside the Department, 
whether made orally or in writing, unless disclosed under 5 U.S.C. 552 
and subpart A of this part;
    (ix) Maintain and process information concerning individuals with 
care in order to insure that no inadvertent disclosure of the 
information is made either within or without the Department; and
    (x) Assure that the proper Department authorities are aware of any 
information in a system maintained by the Department which is not 
authorized to be maintained under the provisions of the Privacy Act of 
1974, including information on First Amendment Activities, information 
that is inaccurate, irrelevant or so incomplete as to risk unfairness to 
the individual concerned.
    (3) Heads of components within the Department or their delegates 
shall, at least annually, review the record systems subject to their 
supervision to insure compliance with the provisions of the Privacy Act 
of 1974 and the regulations in this subpart. (See 5 U.S.C. 552a (e)(9), 
(i) and (m))
    (c) Criminal penalties. (1) The Privacy Act imposes criminal 
penalties on the conduct of Government officers or employees as follows: 
Any officer or employee of an agency (which term includes the Department 
of the Treasury):
    (i) Who by virtue of the official's employment or official position, 
has possession of, or access to, agency records which contain 
individually identifiable information the disclosure of which is 
prohibited by this section (5 U.S.C. 552a) or regulations established 
thereunder, and who knowing that disclosure of the specific material is 
so prohibited, willfully discloses the material in any manner to any 
person or agency not entitled to receive it, or
    (ii) Who willfully maintains a system of records without meeting the 
notice requirements of paragraph (e)(4) of this section (5 U.S.C. 
552a)--shall be guilty of a misdemeanor and fined not more than $5,000.
    (2) The Act also imposes a collateral criminal penalty on the 
conduct of any person as follows:

    ``Any person who knowingly and willfully requests or obtains any 
record concerning an individual from an agency under false pretenses 
shall be guilty of a misdemeanor and fined not more than $5,000.''

    (3) For the purposes of 5 U.S.C. 552a (i), the provisions of 
paragraph (c)(1) of this section are applicable to Government 
contractors and employees of such contractors who by contract, operate 
by or on behalf of the Department of the Treasury a system of records to 
accomplish a Departmental function. Such contractor and employees are 
considered employees of the Department of the Treasury for the purposes 
of 5 U.S.C. 552a(i). (See 5 U.S.C. 552a (i) and (m).)



Sec. 1.29  Records transferred to Federal Records Center or National Archives of the United States.

    (a) Records transferred to the Administrator of General Services for 
storage in the Federal Records Center. Records pertaining to an 
identifiable individual which are transferred to the Federal Records 
Center in accordance with 44 U.S.C. 3103 shall, for the purposes of the 
Privacy Act, 5 U.S.C. 552a, be considered to be maintained by the 
component which deposited the record and shall be subject to the 
provisions of the Privacy Act and this subpart. The Administrator of 
General Services shall not disclose such records except to the

[[Page 48]]

Department of the Treasury or to others under rules consistent with the 
Privacy Act which may be established by the Department of the Treasury 
or a component. If such records are retrieved for the purpose of making 
a determination about an individual, they must be reviewed for accuracy, 
relevance, timeliness, and completeness.
    (b) Records transferred to the National Archives of the United 
States. (1) Records transferred to National Archives prior to September 
27, 1975. Records pertaining to an identifiable individual transferred 
to the National Archives prior to September 27, 1975, as a record which 
has sufficient historical or other value to warrant its continued 
preservation by the United States Government shall be considered to be 
maintained by the National Archives, and
    (i) Shall not be subject to 5 U.S.C. 552a,
    (ii) Except, that a statement describing such records [modeled after 
5 U.S.C. 552a (e)(4) (A) through (G)] shall be published in the Federal 
Register.
    (2) Records transferred to National Archives on or after September 
27, 1975. Records pertaining to an identifiable individual transferred 
to the National Archives as a record which has sufficient historical or 
other value to warrant its continued preservation by the United States 
Government, on or after September 27, 1975, shall be considered to be 
maintained by the National Archives, and
    (i) Shall not be subject to 5 U.S.C. 552a,
    (ii) Except, that a statement describing such records in accordance 
with 5 U.S.C. 552a (e)(4) (A) through (G) shall be published in the 
Federal Register and rules of conduct and training in accordance with 5 
U.S.C. 552 (e) (9) are to be established by the National Archives. (See 
5 U.S.C. 552a (e))



Sec. 1.30  Application to system of records maintained by Government contractors.

    When a component contracts for the operation of a system of records, 
to accomplish a Departmental function, the provisions of the Privacy 
Act, 5 U.S.C. 552a, and this subpart shall be applicable to such system. 
The component shall have responsibility for insuring that the contractor 
complies with the contract requirements relating to privacy.



Sec. 1.31  Sale or rental of mailing lists.

    (a) In general. An individual's name and address shall not be sold 
or rented by a component unless such action is specifically authorized 
by law.
    (b) Withholding of names and addresses. This section shall not be 
construed to require the withholding of names and addresses otherwise 
permitted to be made public. (See 5 U.S.C. 552a (n)).



Sec. 1.32  Use and disclosure of social security numbers.

    (a) In general. An individual shall not be denied any right, 
benefit, or privilege provided by law by a component because of such 
individual's refusal to disclose his social security number.
    (b) Exceptions. The provisions of paragraph (a) of this section 
shall not apply with respect to:
    (1) Any disclosure which is required by Federal statute, or
    (2) The disclosure of a social security number to any Federal, 
State, or local agency maintaining a system of records in existence and 
operating before January 1, 1975, if such disclosure was required under 
statute or regulation adopted prior to such date to verify the identity 
of an individual.
    (c) Requests for disclosure of social security number. Any component 
which requests an individual to disclose his or her social security 
account number shall inform that individual whether:
    (1) Disclosure is mandatory or voluntary.
    (2) By what statutory or other authority such number is solicited, 
and
    (3) What uses will be made of it. (See section 7 of the Privacy Act 
of 1974 set forth at 5 U.S.C. 552a, note.)



Sec. 1.34  Guardianship.

    The parent or guardian of a minor or a person judicially determined 
to be incompetent shall, in addition to establishing the identity of the 
minor or other person represented, establish parentage or guardianship 
by furnishing a copy of a birth certificate showing parentage or a court 
order establishing the guardianship and may thereafter,

[[Page 49]]

act on behalf of such individual. (See 5 U.S.C. 552a (h))



Sec. 1.35  Information forms.

    (a) Review of forms. Except for forms developed and used by 
constituent units, the Deputy Assistant Secretary for Administration 
shall be responsible for reviewing all forms developed and used by the 
Department of the Treasury to collect information from and about 
individuals. The heads of components shall each be responsible for the 
review of forms used by such component to collect information from and 
about individuals.
    (b) Scope of review. The responsible officers shall review each form 
for the purpose of eliminating any requirement for information that is 
not relevant and necessary to carry out an agency function and to 
accomplish the following objectives;
    (1) To insure that no information concerning religion, political 
beliefs or activities, association memberships (other than those 
required for a professional license), or the exercise of First Amendment 
rights is required to be disclosed unless such requirement of disclosure 
is expressly authorized by statute or is pertinent to, and within the 
scope of, any authorized law enforcement activity;
    (2) To insure that the form or a separate form that can be retained 
by the individual makes clear to the individual which information he is 
required by law to disclose and the authority for that requirement and 
which information is voluntary;
    (3) To insure that the form or a separate form that can be retained 
by the individual states clearly the principal purpose or purposes for 
which the information is being collected, and summarizes concisely the 
routine uses that will be made of the information;
    (4) To insure that the form or a separate form that can be retained 
by the individual clearly indicates to the individual the effect in 
terms of rights, benefits or privileges of not providing all or part of 
the requested information; and
    (5) To insure that any form requesting disclosure of a Social 
Security Number, or a separate form that can be retained by the 
individual, clearly advises the individual of the statute or regulation 
requiring disclosure of the number or clearly advises the individual 
that disclosure is voluntary and that no consequence will follow from 
the refusal to disclose it, and the uses that will be made of the number 
whether disclosed mandatorily and voluntarily.
    (c) Revision of forms. Any form which does not meet the objectives 
specified in the Privacy Act and in this section, shall be revised to 
conform thereto. A separate statement may be used in instances when a 
form does not conform. This statement will accompany a form and shall 
include all the information necessary to accomplish the objectives 
specified in the Privacy Act and this section.



Sec. 1.36  Systems exempt in whole or in part from provisions of 5 U.S.C. 552a and this part.

    In accordance with 5 U.S.C. 552a (j) and (k) and Sec. 1.23(c), 
constituent units of the Department of the Treasury exempt the following 
systems of records from certain provisions of the Privacy Act for the 
reasons indicated:

                         Office of the Secretary

                      office of the general counsel

 Notice exempting a system of records from requirements of the Privacy 
                                   Act

    (a) In general. The General Counsel of the Treasury exempts the 
system of records entitled ``Treasury Interagency Automated Litigation 
System (TRIALS)'' from the provisions of subsections (c)(3), (d), 
(e)(1), (e)(4)(G), (H) and (I), and (f) of 5 U.S.C. 552a. The manual 
part of this system of records contains information or documents 
relating to litigation or administrative proceedings involving or 
concerning the Department or its officials, and includes pending, active 
and closed files. The manual records consist of copies of pleadings, 
investigative reports, information compiled in reasonable anticipation 
of a civil action or proceeding, legal memoranda, and related 
correspondence. Pleadings which have been filed with a court or 
administrative tribunal are matters of public record and no exemption is 
claimed as

[[Page 50]]

to them. The computerized part of the system contains summary data on 
Treasury Department non-tax litigation and administrative proceedings, 
e.g., plaintiff, defendant, attorney, witness, judge and/or hearing 
officer names, type of case, relief sought, date, docket number, 
pertinent dates, and issues. The purpose of the exemptions is to 
maintain the confidentiality of investigatory materials compiled for law 
enforcement purposes; information compiled in reasonable anticipation of 
a civil action a proceeding is exempt from access under section (d)(5) 
until the file is closed; thereafter section (k)(2) may apply in part to 
the information. Legal memorandum and related correspondence contain no 
personal information and are not subject to disclosure under section 
552a. Determinations concerning whether particular information contained 
in this system is exempt from disclosure will be made at the time a 
request is received from an individual to gain access to information 
pertaining to him.
    (b) Authority. These rules are promulgated pursuant to the authority 
vested in the Secretary of the Treasury by 5 U.S.C. 552a(k), and 
pursuant to the authority vested in the General Counsel by 31 CFR 
1.23(c).
    (c) Name of system. Treasury Interagency Automated Litigation System 
(TRIALS).
    (d) Provisions from which exempted. This system contains records 
described in 5 U.S.C. 552a(k), the Privacy Act of 1974. Exemption will 
be claimed for such records only where appropriate from the following 
provisions, subsections (c)(3), (d), (e)(1), (e)(4)(G), (H), and (I), 
and (f) of 5 U.S.C. 552a.
    (e) Reasons for claimed exemptions. Those sections would otherwise 
require the Department to notify an individual of investigatory 
materials maintained in a record pertaining to him, permit access to 
such record, permit requests for its correction (section 552a(d), 
(e)(4)(G), (H), and (f)); make available to him any required accounting 
of disclosures made of the record (section 552a(c)(3)), publish the 
sources of records in the system (section 552a(e)(4)(I)); and screen 
records to insure that there is maintained only such information about 
an individual as is relevant to accomplish a required purpose of the 
Department (section 552a(e)(1)). The records compiled for the 
prosecution or defense of civil litigation on behalf of the Department 
or its officials contain investigatory materials compiled for litigation 
purposes, together with memoranda concerning the applicable law, and 
related correspondence. The use of investigatory material in court 
proceedings is governed by due process and statutory procedural 
requirements. Informing individuals that they are on record in a 
particular system enables such individuals to learn the nature of the 
investigatory material and the evidentiary basis for prosecuting or 
defending legal proceedings to which they are a party; furthermore, the 
disclosure of certain investigatory material compiled for law 
enforcement purposes may disclose investigative techniques and 
procedures so that future law enforcement efforts would be hindered. 
Access to an accounting of disclosures of such records would have a 
similar detrimental effort upon the successful prosecution of legal 
claims. In addition, screening for relevancy to Department purposes, and 
correction or attempted correction of such materials could require 
excessive amounts of time and effort on the part of all concerned. 
Accordingly, the General Counsel finds that the public interest and 
public policy in maintaining an effective legal services program 
requires exemption from the stated sections of the Act to the extent 
that they are applicable to appropriate materials in this system.

                     office of the inspector general

Notice exempting a system of records from the disclosure requirements of 
                         the Privacy Act of 1974

    (a) In general. The Office of the Inspector General, Department of 
the Treasury exempts the system of records entitled, ``General 
Allegations and Investigative Records'' from certain provisions of the 
Privacy Act of 1974. The purpose of the exemption is to maintain 
confidentiality of data obtained from various sources that may 
ultimately accomplish a statutory or executively ordered purpose.

[[Page 51]]

    (b) Authority: The authority to issue exemptions is vested in the 
Office of the Inspector General, as a constituent unit of the Treasury 
Department by 31 CFR 1.20.
    (c) Exemptions under 5 U.S.C. 552a(j)(2): (1) Under 5 U.S.C. 
552a(j)(2), the head of any agency may exempt any system of records 
within the agency from certain provisions of the Privacy Act of 1974, if 
the agency or component that maintains the system performs as its 
principal function any activities pertaining to the enforcement of 
criminal laws. The Office of the Inspector General is authorized under 
Treasury Department Order No. 256 to initiate, organize, direct, and 
control investigations of any allegations of illegal acts, violations, 
and any other misconduct, concerning any official or employee of any 
Treasury Office or Bureau.
    (2) To the extent that the exemption under 5 U.S.C. 552a(j)(2) does 
not apply to the above named system of records, then the exemption under 
5 U.S.C. 552a(k)(2) relating to investigatory material compiled for law 
enforcement purposes is claimed for this system.
    (3) The provisions of the Privacy Act of 1974 from which exemptions 
are claimed under 5 U.S.C. 552a(j)(2) are as follows:

5 U.S.C. 552a(c)(3) and (4)
5 U.S.C. 552a(d)(1), (2), (3), (4)
5 U.S.C. 552a(e)(1)(2) and (3)
5 U.S.C. 552a(e)(4)(G), (H), and (I)
5 U.S.C. 552a(e)(5) and (8)
5 U.S.C. 552a(f)
5 U.S.C. 552a(g)

    (d) Exemptions under 5 U.S.C. 552a(k)(2): (1) Under 5 U.S.C. 
552a(k)(2), the head of any agency may exempt any system of records 
within the agency from certain provisions of the Privacy Act of 1974 if 
the system is investigatory material compiled for law enforcement 
purposes.
    (2) To the extent that information contained in the above named 
system has as its principal purpose the enforcement of criminal laws, 
the exemption for such information under 5 U.S.C. 552a(j)(2) is claimed.
    (3) Provisions of the Privacy Act of 1974 from which exemptions are 
claimed under 5 U.S.C. 552a(k)(2) are as follows:

5 U.S.C. 552a(c)(3)
5 U.S.C. 552a(d)(1), (2), (3), and (4)
5 U.S.C. 552a(e)(1)
5 U.S.C. 552a(e)(4)(G), (H), and (I)
5 U.S.C. 552a(f)

    (e) Reasons for exemptions under 5 U.S.C. 552a(j)(2) and (k)(2): (1) 
5 U.S.C. 552a(c)(3) requires that an agency make accountings of 
disclosures of records available to individuals named in the records at 
their request. These accountings must state the date, nature and purpose 
of each disclosure of the record and the name and address of the 
recipient. The application of this provision would alert subjects of an 
investigation to the existence of the investigation and that such 
persons are subjects of that investigation. Since release of such 
information to subjects of an investigation would provide the subjects 
with significant information concerning the nature of the investigation, 
it could result in the altering or destruction of documentary evidence, 
improper influencing of witnesses, and other activities that could 
impede or compromise the investigation.
    (2) 5 U.S.C. 552a(c)(4), (d)(1), (2), (3), and (4), (e)(4)(G) and 
(H), (f) and (g) relate to an individual's right to be notified of the 
existence of records pertaining to such individual; requirements for 
identifying an individual who requests access to records; the agency 
procedures relating to access to records and the contest of information 
contained in such records; and the civil remedies available to the 
individual in the event of adverse determinations by an agency 
concerning access to or amendment of information contained in record 
systems. This system is exempt from the foregoing provisions for the 
following reasons: To notify an individual at the individual's request 
of the existence of records in an investigative file pertaining to such 
individual or to grant access to an investigative file could interfere 
with investigative and enforcement proceedings; co-defendants of a right 
to a fair trial; constitute an unwarranted invasion of the personal 
privacy of others, disclose the identity of confidential sources and 
reveal confidential information supplied by these sources; and disclose 
investigative techniques and procedures.

[[Page 52]]

    (3) 5 U.S.C. 552a(e)(4)(I) requires the publication of the 
categories of sources of records in each system of records. The 
application of this provision could disclose investigative techniques 
and procedures and cause sources to refrain from giving such information 
because of fear of reprisal, or fear of breach of promises of anonymity 
and confidentiality. This would compromise the ability to conduct 
investigations, and to identify, detect, and apprehend violators.
    (4) 5 U.S.C. 552a(e)(1) requires each agency to maintain in its 
records only such information about an individual that is relevant and 
necessary to accomplish a purpose of the agency required by statute or 
Executive Order. An exemption from the foregoing is needed:
    (A) Because it is not possible to detect relevance or necessity of 
specific information in the early stages of a criminal or other 
investigation.
    (B) Relevance and necessity are questions of judgment and timing. 
What appears relevant and necessary when collected may ultimately be 
determined to be unnecessary. It is only after the information is 
evaluated that the relevance and necessity of such information can be 
established.
    (C) In any investigation the Inspector General may obtain 
information concerning the violations of laws other than those within 
the scope of his jurisdiction. In the interest of effective law 
enforcement, the Inspector General should retain this information as it 
may aid in establishing patterns of criminal activity, and provide leads 
for those law enforcement agencies charged with enforcing other segments 
of criminal or civil law.
    (D) In interviewing persons, or obtaining other forms of evidence 
during an investigation, information may be supplied to the investigator 
which relate to matters incidental to the main purpose of the 
investigation but which may relate to matters under the investigative 
jurisdiction of another agency. Such information cannot readily be 
segregated.
    (5) 5 U.S.C. 552a(e)(2) requires an agency to collect information to 
the greatest extent practicable directly from the subject individual 
when the information may result in adverse determinations about an 
individual's rights, benefits, and privilege under Federal programs. The 
application of the provision would impair investigations of illegal 
acts, violations of the rules of conduct, merit system and any other 
misconduct for the following reasons:
    (A) In certain instances the subject of an investigation cannot be 
required to supply information to investigators. In those instances, 
information relating to a subject's illegal acts, violations of rules of 
conduct, or any other misconduct, etc., must be obtained from other 
sources.
    (B) Most information collected about an individual under 
investigation is obtained from third parties such as witnesses and 
informers. It is not feasible to rely upon the subject of the 
investigation as a source for information regarding his activities.
    (C) The subject of an investigation will be alerted to the existence 
of an investigation if an attempt is made to obtain information from the 
subject. This would afford the individual the opportunity to conceal any 
criminal activities to avoid apprehension.
    (D) In any investigation it is necessary to obtain evidence from a 
variety of sources other than the subject of the investigation in order 
to verify the evidence necessary for successful litigation.
    (6) 5 U.S.C. 552a(e)(3) requires that an agency must inform the 
subject of an investigation who is asked to supply information of:
    (A) The authority under which the information is sought and whether 
disclosure of the information is mandatory or voluntary.
    (B) The purposes for which the information is intended to be used,
    (C) The routine uses which may be made of the information, and
    (D) The effects on the subject, if any of not providing the 
requested information. The reasons for exempting this system of records 
from the foregoing provision are as follows:
    (i) The disclosure to the subject of the investigation as stated in 
(B) above

[[Page 53]]

would provide the subject with substantial information relating to the 
nature of the investigation and could impede or compromise the 
investigation.
    (ii) If the subject were informed of the information required by 
this provision, it could seriously interfere with undercover activities 
by requiring disclosure of undercover agents identity and impairing 
their safety, as well as impairing the successful conclusion of the 
investigation.
    (iii) Individuals may be contacted during preliminary information 
gathering in investigations authorized by Treasury Department Order No. 
256 before any individual is identified as the subject of an 
investigation. Informing the individual of the matters required by this 
provision would hinder or adversely affect any present or subsequent 
investigations.
    (7) 5 U.S.C. 552a(e)(5) requires that records be maintained with 
such accuracy, relevance, timeliness, and completeness as is reasonably 
necessary to assure fairness to the individual in making any 
determination about an individual. Since the law defines ``maintain'' to 
include the collection of information, complying with this provision 
would prevent the collection of any data not shown to be accurate, 
relevant, timely, and complete at the moment of its collection. In 
gathering information during the course of an investigation it is not 
possible to determine this prior to collection of the information. Facts 
are first gathered and then placed into a logical order which 
objectively proves or disproves criminal behavior on the part of the 
suspect. Material which may seem unrelated, irrelevant, incomplete, 
untimely, etc., may take on added meaning as an investigation 
progresses. The restrictions in this provision could interfere with the 
preparation of a complete investigative report.
    (8) 5 U.S.C. 552a(e)(8) requires an agency to make reasonable 
efforts to serve notice on an individual when any record on such 
individual is made available to any person under compulsory legal 
process when such process becomes a matter of public record. The notice 
requirement of this provision could prematurely reveal an ongoing 
criminal investigation to the subject of the investigation.
    (f) Exempt information included in another system. Any information 
from a system of records for which an exemption is claimed under 5 
U.S.C. 552a(j) or (k) which also is included in another system of 
records retains the same exempt status as in the system for which an 
exemption is claimed.

                 Assistant Secretary for Administration

    The Assistant Secretary for Administration exempts under section (k) 
of the Privacy Act of 1974, 5 U.S.C. 552a, the Department's Personnel 
Security Files and Personnel Security Files and Indices from sections 
(c)(3), (d), (e)(1), (e)(4)(G) through (e)(4)(I), and (f) of the Act. 
The records maintained in the exempt systems of records are of the type 
described in section (k)(5) of the Act:

investigatory material compiled solely for the purpose of determining 
suitability, eligibility, or qualifications for Federal civilian 
employment, military service, Federal contracts, or access to classified 
information, but only to the extent that the disclosure of such material 
would reveal the identity of a source who furnished information to the 
Government under an express promise that the identity of the source 
would be held in confidence, or, prior to the effective date of this 
section, under an implied promise that the identity of the source would 
be held in confidence.


Thus to the extent that the records in this system can be disclosed 
without revealing the identity of a confidential source, they are not 
within the scope of this exemption and are subject to all the 
requirements of the Privacy Act.
    The sections of the Act from which this system of records are exempt 
are in general those providing for individual access to records. When 
such access would cause the identity of a confidential source to be 
revealed, it would impair the future ability of the Treasury Department 
to compile investigatory material for the purpose of determining 
suitability, eligibility, or qualifications for Federal civilian 
employment, Federal contracts, or access to classified information.
    In addition, the systems are exempt from section (e)(1) which 
requires that the agency maintain in its records only such information 
about an individual

[[Page 54]]

as is relevant and necessary to accomplish a statutory or executively 
ordered purpose. The Director finds that to fulfill the requirements of 
section (e)(1) would unduly restrict the agency in its information 
gathering inasmuch as it is often not until well after the investigation 
that it is possible to determine the relevance and necessity of 
particular information.
    If any investigations within the scope of section (k)(5) become 
involved with civil or criminal matters, exemptions from the Act could 
also be asserted under sections (k)(2) or (j)(2).

  Exemption of foreign assets control enforcement records from certain 
  provisions of the Privacy Act of 1974 (pub. l. 93-579, 5 U.S.C. 552a)

    The new regulations promulgated by the Office of Foreign Assets 
Control (as amendments to its Foreign Assets Control Regulations; 
Transaction Control Regulations; Cuban Assets Control Regulations; and, 
Rhodesian Sanction Regulations) read as follows:
    Pursuant to subsection (k)(2) of 5 U.S.C. 552a, the Privacy Act of 
1974, the Enforcement Records of the Office of Foreign Assets Control 
are hereby exempted from the requirements of subsections (c)(3), (d), 
(e)(1), (e)(4)(G-I), and (f) of 5 U.S.C. 552a, as materials which are 
compiled and maintained for the purpose of conducting and recording 
investigations of criminal violations of relevant statutes and 
regulations administered by the Office of Foreign Assets Control. These 
records contain, among other things, information and evidence which was 
furnished in confidence by individuals, corporations, partnerships and 
other entities, Federal, State and local agencies, and by foreign 
individuals, corporations, partnerships and other entities, and foreign 
government sources. If it should appear that the individual concerning 
whom a record is maintained has been or will be denied any right, 
privilege, or benefit to which he would otherwise be entitled by Federal 
law, or for which he would otherwise be eligible, except for the 
maintenance of such material, such material shall be disclosed to such 
individual, except: (1) To the extent that disclosure would reveal the 
identity of a source who furnished information to the government under 
an express promise that the identity of the source would be held in 
confidence; or (2) to the extent that disclosure would reveal the 
identity of a source who furnished information prior to the effective 
date of the Privacy Act (September 27, 1975) under an implied promise 
that the identity of the source would be held in confidence.

                    Assistant Secretary (Enforcement)

                  Financial Crimes Enforcement Network

                         Notice of Exempt System

    (a) In general. The Assistant Secretary of the Treasury for 
Enforcement exempts the system of records entitled ``FinCEN Data Base'' 
(Treasury/DO .200) from certain provisions of the Privacy Act of 1974, 
as amended, 5 U.S.C. 552a.
    (b) Authority: 5 U.S.C. 552a (j) and (k); 31 CFR 1.23(c).
    (c) General exemptions under 5 U.S.C. 552a(j)(2). Pursuant to 5 
U.S.C. 552a(j)(2), the Assistant Secretary for Enforcement hereby 
exempts the FinCEN Data Base system of records, maintained by the 
Financial Crimes Enforcement Network (``FinCEN''), an office reporting 
to the Assistant Secretary for Enforcement, from the following 
provisions of the Privacy Act of 1974:

5 U.S.C. 552a(c) (3) and (4);
5 U.S.C. 552a(d) (1), (2), (3) and (4);
5 U.S.C. 552a (e) (1), (2) and (3);
5 U.S.C. 552a(e)(4) (G), (H) and (I);
5 U.S.C. 552a(e) (5) and (8);
5 U.S.C. 552a(f); and
5 U.S.C. 552a(g).

    (d) Specific exemptions under 5 U.S.C. 552a(k)(1). To the extent 
that the system of records may contain information subject to the 
provisions of 5 U.S.C. 552(b)(1), regarding national defense and foreign 
policy information classified pursuant to Executive order, the Assistant 
Secretary for Enforcement hereby exempts the FinCEN Data Base system of 
records from the following provisions of 5 U.S.C. 552a, pursuant to 5 
U.S.C. 552a(k)(1):

5 U.S.C. 552a(c)(3);
5 U.S.C. 552a(d) (1), (2), (3), and (4);
5 U.S.C. 552a(e)(1);

[[Page 55]]

5 U.S.C. 552a(e)(4) (G), (H), and (I); and
5 U.S.C. 552a(f).

    (e) Specific exemptions under 5 U.S.C. 552a(k)(2). To the extent 
that the exemption under 5 U.S.C. 552a(j)(2) does not apply to the 
FinCEN Data Base, the Assistant Secretary for Enforcement hereby exempts 
the FinCEN Data Base system of records from the following provisions of 
5 U.S.C. 552a, pursuant to 5 U.S.C. 552a(k)(2):

5 U.S.C. 552a(c)(3);
5 U.S.C. 552a(d) (1), (2), (3), and (4);
5 U.S.C. 552a(e)(1);
5 U.S.C. 552a(e)(4) (G), (H), and (I); and
5 U.S.C. 552a(f).

    (f) Reasons for exemptions under 5 U.S.C. 552a (j)(2) and (k)(2). 
(1) 5 U.S.C. 552a (e)(4)(G) and (f)(1) enable individuals to inquire 
whether a system of records contains records pertaining to them. 
Application of these provisions to the FinCEN Data Base would allow 
individuals to learn whether they have been identified as suspects or 
subjects of investigation. As further described in the following 
paragraph, access to such knowledge would impair FinCEN's ability to 
carry out its mission, since individuals could (i) take steps to avoid 
detection, (ii) inform associates that an investigation is in progress, 
(iii) learn the nature of the investigation, (iv) learn whether they are 
only suspects or identified as law violators, (v) begin, continue, or 
resume illegal conduct upon learning that they are not identified in the 
system of records, or (vi) destroy evidence needed to prove the 
violation.
    (2) 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f)(2), (3) and (5) grant 
individuals access to records pertaining to them. The application of 
these provisions to the FinCEN Data Base would compromise FinCEN's 
ability to provide useful tactical and strategic information to law 
enforcement agencies.
    (i) Permitting access to records contained in the FinCEN Data Base 
would provide individuals with information concerning the nature of any 
current investigations and would enable them to avoid detection or 
apprehension by (A) discovering the facts that would form the basis for 
their arrest, (B) enabling them to destroy or alter evidence of criminal 
conduct that would form the basis for their arrest, and (C) using 
knowledge that criminal investigators had reason to believe that a crime 
was about to be committed, to delay the commission of the crime or 
commit it at a location that might not be under surveillance.
    (ii) Permitting access to either on-going or closed investigative 
files would also reveal investigative techniques and procedures, the 
knowledge of which could enable individuals planning crimes to structure 
their operations so as to avoid detection or apprehension.
    (iii) Permitting access to investigative files and records could, 
moreover, disclose the identity of confidential sources and informers 
and the nature of the information supplied and thereby endanger the 
physical safety of those sources by exposing them to possible reprisals 
for having provided the information. Confidential sources and informers 
might refuse to provide criminal investigators with valuable information 
unless they believed that their identities would not be revealed through 
disclosure of their names or the nature of the information they 
supplied. Loss of access to such sources would seriously impair FinCEN's 
ability to carry out its mandate.
    (iv) Furthermore, providing access to records contained in the 
FinCEN Data Base could reveal the identities of undercover law 
enforcement officers who compiled information regarding the individual's 
criminal activities and thereby endanger the physical safety of those 
undercover officers or their families by exposing them to possible 
reprisals.
    (v) By compromising the law enforcement value of the FinCEN Data 
Base for the reasons outlined in paragraphs (f)(2) through (iv) of this 
paragraph, permitting access in keeping with these provisions would 
discourage other law enforcement and regulatory agencies, foreign and 
domestic, from freely sharing information with FinCEN and thus would 
restrict FinCEN's access to information necessary to accomplish its 
mission most effectively.
    (vi) Finally, the dissemination of certain information that FinCEN 
may maintain in the FinCEN Data Base is restricted by law.

[[Page 56]]

    (3) 5 U.S.C. 552a (d) (2), (3) and (4), (e)(4)(H), and (f)(4) permit 
an individual to request amendment of a record pertaining to him or her 
and require the agency either to amend the record, or to note the 
disputed portion of the record and to provide a copy of the individual's 
statement of disagreement with the agency's refusal to amend a record to 
persons or other agencies to whom the record is thereafter disclosed. 
Since these provisions depend on the individual's having access to his 
or her records, and since these rules propose to exempt the FinCEN Data 
Base from the provisions of 5 U.S.C. 552a relating to access to records, 
for the reasons set out in paragraph (f)(2) of this section, these 
provisions should not apply to the FinCEN Data Base.
    (4) 5 U.S.C. 552(c)(4) requires an agency to inform any person or 
other agency about any correction or notation of dispute that the agency 
made in accordance with 5 U.S.C. 552a(d) to any record that the agency 
disclosed to the person or agency if an accounting of the disclosure was 
made. Since this provision depends on an individual's having access to 
and an opportunity to request amendment of records pertaining to him or 
her, and since these rules proposed to exempt the FinCEN Data Base from 
the provisions of 5 U.S.C. 552a relating to access to and amendment of 
records, for the reeasons set out in paragraph (f)(3) of this section, 
this provision ought not apply to the FinCEN Data Base.
    (5) 5 U.S.C. 552a(3) requires an agency to make accountings of 
disclosures of a record available to the individual named in the record 
upon his or her request. The accountings must state the date, nature, 
and purpose of each disclosure of the record and the name and address of 
the recipient.
    (i) The application of this provision would impair the ability of 
law enforcement agencies outside the Department of the Treasury to make 
effective use of information provided by FinCEN. Making accountings of 
disclosures available to the subjects of an investigation would alter 
them to the fact that another agency is conducting an investigation into 
their criminal activities and could reveal the geographic location of 
the other agency's investigation, the nature and purpose of that 
investigation, and the dates on which that investigation was active. 
Violators possessing such knowledge would be able to take measures to 
avoid detection or apprehension by altering their operations, by 
transferring their criminal activities to other geographical areas, or 
by destroying or concealing evidence that would form the basis for 
arrest.
    (ii) Moreover, providing accountings to the subjects of 
investigations would alert them to the fact that FinCEN has information 
regarding their criminal activities and could inform them of the general 
nature of that information. Access to such information could reveal the 
operation of FinCEN's information-gathering and analysis systems and 
permit violators to take steps to avoid detection or apprehension.
    (6) 5 U.S.C. 552a(e)(4)(I) requires an agency to publish a general 
notice listing the categories of sources for information contained in a 
system of records. The application of this provision to the FinCEN Data 
Base could compromise FinCEN's ability to provide useful information to 
law enforcement agencies, since revealing sources for the information 
could (i) disclose investigative techniques and procedures, (ii) result 
in threats or reprisals against informers by the subjects of 
investigations, and (iii) cause informers to refuse to give full 
information to criminal investigators for fear of having their 
identities as sources disclosed.
    (7) 5 U.S.C. 552a(e)(1) requires an agency to maintain in its 
records only such information about an individual as is relevant and 
necessary to accomplish a purpose of the agency required to be 
accomplished by statute or executive order. The term ``maintain,'' as 
defined in 5 U.S.C. 552a(a)(3), includes ``collect'' and 
``disseminate.'' The application of this provision to the FinCEN Data 
Base could impair FinCEN's ability to collect and disseminate valuable 
law enforcement information.
    (i) At the time that FinCEN collects information, it often lacks 
sufficient time to determine whether the information is relevant and 
necessary to accomplish a FinCEN purpose.

[[Page 57]]

    (ii) In many cases, especially in the early stages of investigation, 
it may be impossible immediately to determine whether information 
collected is relevant and necessary, and information that initially 
appears irrelevent and unnecessary often may, upon further evaluation or 
upon collation with information developed subsequently, prove 
particularly relevant to a law enforcement program.
    (iii) Not all violations of law discovered by FinCEN analysts fall 
within the investigative jurisdiction of the Department of the Treasury. 
To promote effective law enforcement, FinCEN will have to disclose such 
violations to other law enforcement agencies, including State, local and 
foreign agencies, that have jurisdiction over the offenses to which the 
information relates. Otherwise, FinCEN might be placed in the position 
of having to ignore information relating to violations of law not within 
the jurisdiction of the Department of the Treasury when that information 
comes to FinCEN's attention during the collation and analysis of 
information in its records.
    (8) 5 U.S.C. 552a(e)(2) requires an agency to collect information to 
the greatest extent practicable directly from the subject individual 
when the information may result in adverse determinations about an 
individual's rights, benefits, and privileges under Federal programs. 
The application of this provision to the FinCEN Data Base would impair 
FinCEN's ability to collate, analyze, and disseminate investigative, 
intelligence, and enforcement information.
    (i) Most information collected about an individual under criminal 
investigation is obtained from third parties, such as witnesses and 
informants. It is usually not feasible to rely upon the subject of the 
investigation as a source for information regarding his criminal 
activities.
    (ii) An attempt to obtain information from the subject of a criminal 
investigation will often alert that individual to the existence of an 
investigation, thereby affording the individual an opportunity to 
attempt to conceal his criminal activities so as to avoid apprehension.
    (iii) In certain instances, the subject of a criminal investigation 
is not required to supply information to criminal investigators as a 
matter of legal duty.
    (iv) During criminal investigations it is often a matter of sound 
investigative procedure to obtain information from a variety of sources 
to verify information already obtained.
    (9) 5 U.S.C. 552a(e)(3) requires an agency to inform each individual 
whom it asks to supply information, on the form that it uses to collect 
the information or on a separate form that the individual can retain, of 
the agency's authority for soliciting the information; whether 
disclosure of information is voluntary or mandatory; the principal 
purposes for which the agency will use the information; the routine uses 
that may be made of the information; and the effects on the individual 
of not providing all or part of the information. The FinCEN Data Base 
should be exempted from this provision to avoid impairing FinCEN's 
ability to collect and collate investigative, intelligence, and 
enforcement data.
    (i) Confidential sources or undercover law enforcement officers 
often obtain information under circumstances in which it is necessary to 
keep the true purpose of their actions secret so as not to let the 
subject of the investigation or his or her associates know that a 
criminal investigation is in progress.
    (ii) If it became known that the undercover officer was assisting in 
a criminal investigation, that officer's physical safety could be 
endangered through reprisal, and that officer may not be able to 
continue working on the investigation.
    (iii) Individuals often feel inhibited in talking to a person 
representing a criminal law enforcement agency but are willing to talk 
to a confidential source or undercover officer whom they believe not to 
be involved in law enforcement activities.
    (iv) Providing a confidential source of information with written 
evidence that he or she was a source, as required by this provision, 
could increase the likelihood that the source of information would be 
subject to retaliation by the subject of the investigation.

[[Page 58]]

    (v) Finally, application of this provision could result in an 
unwarranted invasion of the personal privacy of the subject of the 
criminal investigation, particularly where further investigation reveals 
that the subject was not involved in any criminal activity.
    (10) 5 U.S.C. 552a(e)(5) requires an agency to maintain all records 
it uses in making any determination about any individual with such 
accuracy, relevance, timeliness, and completeness as is reasonably 
necessary to assure fairness to the individual in the determination.
    (i) Since 5 U.S.C. 552a(a)(3) defines ``maintain'' to include 
``collect'' and ``disseminate,'' application of this provision to the 
FinCEN Data Base would hinder the initial collection of any information 
that could not, at the moment of collection, be determined to be 
accurate, relevant, timely, and complete. Similarly, application of this 
provision would seriously restrict FinCEN's ability to disseminate 
information pertaining to a possible violation of law to law enforcement 
and regulatory agencies. In collecting information during a criminal 
investigation, it is often impossible or unfeasible to determine 
accuracy, relevance, timeliness, or completeness prior to collection of 
the information. In disseminating information to law enforcement and 
regulatory agencies, it is often impossible to determine accuracy, 
relevance, timeliness, or completeness prior to dissemination, because 
FinCEN may not have the expertise with which to make such 
determinations.
    (ii) Information that may initially appear inaccurate, irrelevant, 
untimely, or incomplete may, when collated and analyzed with other 
available information, become more pertinent as an investigation 
progresses. In addition, application of this provision could seriously 
impede criminal investigators and intelligence analysts in the exercise 
of their judgment in reporting results obtained during criminal 
investigations.
    (11) 5 U.S.C. 552a(e)(8) requires an agency to make reasonable 
efforts to serve notice on an individual when the agency makes any 
record on the individual available to any person under compulsory legal 
process, when such process becomes a matter of public record. The FinCEN 
Data Base should be exempted from this provision to avoid revealing 
investigative techniques and procedures outlined in those records and to 
prevent revelation of the existence of an ongoing investigation where 
there is need to keep the existence of the investigation secret.
    (12) 5 U.S.C. 552a(g) provides for civil remedies to an individual 
when an agency wrongfully refuses to amend a record or to review a 
request for amendment, when an agency wrongfully refuses to grant access 
to a record, when an agency fails to maintain accurate, relevant, 
timely, and complete records which are used to make a determination 
adverse to the individual, and when an agency fails to comply with any 
other provision of 5 U.S.C. 552a so as to adversely affect the 
individual. The FinCEN Data Base should be exempted from this provision 
to the extent that the civil remedies may relate to provisions of 5 
U.S.C. 552a from which these rules propose to exempt the FinCEN Data 
Base, since there should be no civil remedies for failure to comply with 
provisions from which FinCEN is exempted. Exemption from this provision 
will also protect FinCEN from baseless civil court actions that might 
hamper its ability to collate, analyze, and disseminate investigative, 
intelligence, and law enforcement data.
    (g) In general. The Assistant Secretary (Enforcement) exempts the 
system of records entitled ``Suspicious Activity Reporting System'' 
(Treasury/DO .212) from certain provisions of the Privacy Act of 1974, 
as amended, 5 U.S.C. 552a.
    (h) Authority. 5 U.S.C. 552a(j) and (k); 31 CFR 1.23(c).
    (i) General exemptions under 5 U.S.C. 552a(j)(2). Pursuant to 5 
U.S.C. 552a(j)(2), the Assistant Secretary (Enforcement) hereby exempts 
the Suspicious Activity Reporting System (SAR System) of records, 
maintained by FinCEN, an office reporting to the Assistant Secretary 
(Enforcement), from the following provisions of the Privacy Act of 1974:

5 U.S.C. 552a(c)(3) and (4);
5 U.S.C. 552a(d)(1), (2), (3), and (4);

[[Page 59]]

5 U.S.C. 552a(e)(1), (2), and (3);
5 U.S.C. 552a(e)(4)(G), (H), and (I):
5 U.S.C. 552a(e)(5) and (8);
5 U.S.C. 552a(f); and
5 U.S.C. 552a(g).

    (j) Specific exemptions under 5 U.S.C. 552a(k)(2). To the extent 
that the exemption under 5 U.S.C. 552a(j)(2) does not apply to the SAR 
System of records, the Assistant Secretary (Enforcement) hereby exempts 
the SAR System of records from the following provisions of 5 U.S.C. 552a 
pursuant to 5 U.S.C. 552a(k)(2):

5 U.S.C. 552a(c)(3);
5 U.S.C. 552a(d)(1), (2), (3), and (4)
5 U.S.C. 552a(e)(1)
5 U.S.C. 552a(e)(4)(G), (H), and (I); and
5 U.S.C. 552a(f).

    (k) Reasons for exemptions under 5 U.S.C. 552a(j)(2) and (k)(2). (1) 
5 U.S.C. 552a(e)(4)(G) and (f)(1) enable individuals to inquire whether 
a system of records contains records pertaining to them. Application of 
these provisions to the SAR System would allow individuals to learn 
whether they have been identified as suspects or possible subjects of 
investigation. Access by individuals to such knowledge would seriously 
hinder the law enforcement purposes that the SAR System is created to 
serve, because individuals involved in activities that are violations of 
law could:
    (i) Take steps to avoid detection;
    (ii) Inform associates that an investigation is in progress;
    (iii) Learn the nature of the investigation;
    (iv) Learn whether they are only suspects or identified as violators 
of law;
    (v) Begin, continue, or resume illegal conduct upon learning that 
they are not identified in the system of records, or
    (vi) Destroy evidence needed to prove the violation.
    (2) 5 U.S.C. 552a(d)(1), (e)(4)(H) and (f)(2), (f)(3) and (f)(5) 
grant individuals access to records containing information about them. 
The application of these provisions to the SAR System would compromise 
the ability of the component agencies of the SAR System to use the 
information effectively for purposes of law enforcement.
    (i) Permitting access to records contained in the SAR System would 
provide individuals with information concerning the nature of any 
current investigations and would enable them to avoid detection or 
apprehension, because they could;
    (A) Discover the facts that would form the basis of an arrest;
    (B) Destroy or alter evidence of criminal conduct that would form 
the basis of their arrest, and
    (C) Delay or change the commission of a crime that was about to be 
discovered by investigators.
    (ii) Permitting access to either on-going or closed investigative 
files would also reveal investigative techniques and procedures, the 
knowledge of which could enable individuals planning crimes to structure 
their operations so as to avoid detection or apprehension.
    (3) 5 U.S.C. 552a(d)(2), (d)(3) and (d)(4), (e)(4)(H) and (f)(4) 
permit an individual to request amendment of a record pertaining to him 
or her and require the agency either to amend the record or note the 
disputed portion of the record and, if the agency refuses to amend the 
record, to provide a copy of the individual's statement of disagreement 
with the agency's refusal, to persons or other agencies to whom the 
record is thereafter disclosed. Because these provisions depend on the 
individual's having access to his or her records, and since these rules 
exempt the SAR System from the provisions of 5 U.S.C. 552a relating to 
access to records, for the reasons set out in paragraph (k)(2), these 
provisions do not apply to the SAR System.
    (4) 5 U.S.C. 552a(c)(4) requires an agency to inform any person or 
other agency about any correction or notation of dispute that the agency 
made in accordance with 5 U.S.C. 552a(d) to any record that the agency 
disclosed to the person or agency, if an accounting of the disclosure 
was made. Because this provision depends on an individual's having 
access to and an opportunity to request amendment of records pertaining 
to him or her, and because these rules exempt the SAR System from the 
provisions of 5 U.S.C. 552a relating to access to and amendment of 
records, for the reasons set forth in paragraphs (k)(2) and (3), this 
provision does not apply to the SAR System.

[[Page 60]]

    (5) 5 U.S.C. 552a(c)(3) requires an agency to make the accounting of 
any disclosures of records required by 5 U.S.C. 552a(c)(1) available to 
the individual named in the record upon his or her request. The 
accounting must state the date, nature, and purpose of each disclosure 
of the record and the name and address of the recipient.
    (i) The application of this provision would impair the effective use 
of information collected in the SAR System. Making an accounting of 
disclosures available to the subjects of an investigation would alert 
them to the fact that another agency is conducting an investigation into 
their criminal activities and could reveal the geographic location of 
the other agency's investigation, the nature and purpose of that 
investigation, and the dates on which that investigation was active. 
Violators possessing such knowledge would be able to take measures to 
avoid detection or apprehension by altering their operations, by 
transferring their criminal activities to other geographical areas, or 
by destroying or concealing evidence that would form the basis for 
arrest.
    (ii) Moreover, providing an accounting to the subjects of 
investigations would alert them to the fact that FinCEN has information 
regarding possible criminal activities and could inform them of the 
general nature of that information. Access to such information could 
reveal the operation of the information-gathering and analysis systems 
of FinCEN, the Federal Supervisory Agencies and other SAR System Users 
and permit violators to take steps to avoid detection or apprehension.
    (6) 5 U.S. C. 552a(e)(4)(I) requires an agency to publish a general 
notice listing the categories of sources for information contained in a 
system of records. The application of this provision to the SAR System 
could compromise FinCEN's and the Federal Supervisory Agencies' ability 
to provide useful information to law enforcement agencies, because 
revealing sources for the information could:
    (i) Disclose investigative techniques and procedures,
    (ii) Result in threats or reprisals against informers by the 
subjects of investigations, and
    (iii) Cause informers to refuse to give full information to criminal 
investigators for fear of having their identities as sources disclosed.
    (7) 5 U.S.C. 552a(e)(1) requires an agency to maintain in its 
records only such information about an individual as is relevant and 
necessary to accomplish a purpose of the agency required to be 
accomplished by statute or executive order. The application of this 
provision to the SAR System could impair the effectiveness of law 
enforcement because in many cases, especially in the early stages of 
investigation, it may be impossible immediately to determine whether 
information collected is relevant and necessary, and information that 
initially appears irrelevant and unnecessary, upon further evaluation or 
upon collation with information developed subsequently, often may prove 
helpful to an investigation.
    (8) 5 U.S.C. 552a(e)(2) requires an agency to collect information to 
the greatest extent practicable directly from the subject individual 
when the information may result in adverse determinations about an 
individual's rights, benefits, and privileges under Federal programs. 
The application of this provision to the SAR System would impair 
FinCEN's ability to collect, analyze and disseminate to System Users 
investigative or enforcement information. The SAR System is designed to 
house information about known or suspected criminal activities or 
suspicious transactions that has been collected and reported by 
financial institutions, or their examiners or other enforcement or 
supervisory officials. It is not feasible to rely upon the subject of an 
investigation to supply information. An attempt to obtain information 
from the subject of any investigation would alert that individual to the 
existence of an investigation, providing an opportunity to conceal 
criminal activity and avoid apprehension. Further, with respect to the 
initial SAR, 31 U.S.C. Sec. 5318(g)(2) specifically prohibits financial 
institutions making such reports from notifying any participant in the 
transaction that a report has been made.

[[Page 61]]

    (9) 5 U.S.C. 552a(e)(3) requires an agency to inform each individual 
whom it asks to supply information, on the form that it uses to collect 
the information or on a separate form that the individual can retain, 
the agency's authority for soliciting the information; whether 
disclosure of information is voluntary or mandatory; the principal 
purposes for which the agency will use the information; the routine uses 
that may be made of the information; and the effects on the individual 
of not providing all or part of the information. The application of 
these provisions to the SAR System would compromise the ability of the 
component agencies of the SAR System to use the information effectively 
for purposes of law enforcement.
    (10) 5 U.S.C. 552a(e)(5) requires an agency to maintain all records 
it uses in making any determination about any individual with such 
accuracy, relevance, timeliness, and completeness as is reasonably 
necessary to assure fairness to the individual in the determination. 
Application of this provision to the SAR System would hinder the 
collection and dissemination of information. Because Suspicious Activity 
Reports are filed by financial institutions with respect to known or 
suspected violations of law or suspicious activities, it is not possible 
at the time of collection for the agencies that use the SAR System to 
determine that the information in such records is accurate, relevant, 
timely and complete.
    (11) 5 U.S.C. 552a(e)(8) requires an agency to make reasonable 
efforts to serve notice on an individual when the agency makes any 
record on the individual available to any person under compulsory legal 
process, when such process becomes a matter of public record. 
Application of these requirements to the SAR System would prematurely 
reveal the existence of an ongoing investigation to the subject of 
investigation where there is need to keep the existence of the 
investigation secret. It would render ineffective 31 U.S.C. 
Sec. 5318(g)(2), which prohibits financial institutions and their 
officers, employees and agents from disclosing to any person involved in 
a transaction that a SAR has been filed.
    (12) 5 U.S.C. 552a(g) provides an individual with civil remedies 
when an agency wrongfully refuses to amend a record or to review a 
request for amendment, when an agency wrongfully refuses to grant access 
to a record, when any determination relating to an individual is based 
on records that are not accurate, relevant, timely and complete, and 
when an agency fails to comply with any other provision of 5 U.S.C. 552a 
so as to adversely affect the individual. Because the SAR System is 
exempt from these provisions it follows that civil remedies for failure 
to comply with these provisions are not appropriate.
    (l) Exempt information included in another system. Any information 
from a system of records for which an exemption is claimed under 5 
U.S.C. 552a (j) or (k) which is also included in another system of 
records retains the same exempt status such information has in the 
system for which such exemption is claimed.

                      The Internal Revenue Service

                        notice of exempt systems

    The Commissioner of Internal Revenue finds that the orderly and 
efficient administration of the internal revenue laws necessitates that 
certain systems of records maintained by the Internal Revenue Service be 
exempted from certain sections of the Privacy Act of 1974 (88 Stat. 
1986).
    (a) Exemptions under 5 U.S.C. 552a (j) (2). (1) This paragraph 
applies to the following systems of records maintained by the Internal 
Revenue Service, for which exemptions are claimed under 5 U.S.C. 552a(j) 
(2).

------------------------------------------------------------------------
                         Name of system                            No.
------------------------------------------------------------------------
Case Management and Time Reporting System, Criminal               46.002
 Investigation Division........................................
Confidential Informants, Criminal Investigation Division.......   46.003
Electronic Surveillance Files, Criminal Investigation Division.   46.005
Centralized Evaluation and Processing of Information Items        46.009
 (CEPIIs), Criminal Investigation Division.....................
Relocated Witnesses, Criminal Investigation Division...........   46.015
Secret Service Details, Criminal Investigation Division........   46.016
Treasury Enforcement Communications System (TECS)..............   46.022
Automated Information Analysis System..........................   46.050
Assault and Threat Investigation Files.........................   60.001

[[Page 62]]

 
Bribery Investigation Files....................................   60.002
Disclosure Investigation Files.................................   60.004
Internal Security Management Information System (ISMIS)........   60.011
Chief Counsel Criminal Tax Case Files..........................   90.001
------------------------------------------------------------------------

    (2) Under 5 U.S.C. 552a(j)(2), the head of any agency may promulgate 
rules to exempt any system of records within the agency from certain 
provisions of the Privacy Act of 1974 if the agency or component thereof 
that maintains the system performs as its principal function any 
activities pertaining to the enforcement of criminal laws. Certain 
components of the Internal Revenue Service have as their principal 
function activities pertaining to the enforcement of criminal laws.
    (3) To the extent the exemption under 5 U.S.C. 552a(j)(2) does not 
apply to any of the above-named systems, then exemptions under 5 U.S.C. 
552a(k)(2), relating to investigatory material compiled for law 
enforcement purposes, are hereby claimed for such systems.
    (4) The provisions of the Privacy Act of 1974 from which exemptions 
are claimed under 5 U.S.C. 552a(j)(2) are as follows:

5 U.S.C. 552a(c) (3) and (4)
5 U.S.C. 552a(d) (1), (2), (3), and (4)
5 U.S.C. 552a(e) (1), (2), and (3)
5 U.S.C. 552a(e) (4) (G), (H), and (I)
5 U.S.C. 552a(e) (5) and (8)
5 U.S.C. 552a(f)
5 U.S.C. 552a(g)

    (5) See paragraph (c) for reasons for the exemptions.
    (b) Exemptions under 5 U.S.C. 552a (k)(2). (1) This paragraph 
applies to the following systems of records maintained by the Internal 
Revenue Service, for which exemptions are claimed under 5 U.S.C. 
552a(k)(2):

------------------------------------------------------------------------
                         Name of system                            No.
------------------------------------------------------------------------
Wage and Information Returns Processing (IRP)..................   22.061
Acquired Property Records......................................   26.001
Form 2209, Courtesy Investigations.............................   26.006
IRS and Treasury Employee Delinquency..........................   26.008
Litigation Case Files..........................................   26.011
Offer in Compromise (OIC) Files................................   26.012
One-hundred Per Cent Penalty Cases.............................   26.013
Returns Compliance Programs (RCP)..............................   26.016
TDA (Taxpayer Delinquent Accounts).............................   26.019
TDI (Taxpayer Delinquency Investigations) Files................   26.020
Transferee Files...............................................   26.021
Delinquency Prevention Programs................................   26.022
Audit Trail Lead Analysis System...............................   34.020
Applicant Appeal Files.........................................   37.002
Closed Files containing Derogatory Information about              37.003
 Individuals' practice before the IRS and Files of attorneys
 and certified public accountants formerly enrolled to Practice
Derogatory Information (No Action).............................   37.004
Present Suspensions and Disbarments Resulting from                37.005
 Administrative Proceeding.....................................
Inventory......................................................   37.007
Resigned Enrolled Agents (action pursuant to 31 CFR Section       37.009
 10.55(b)).....................................................
Present Suspensions from Practice Before the Internal Revenue     37.011
 Service.......................................................
Examination Administrative File................................   42.001
Audit Information Management System (AIMS).....................   42.008
Classification and Examination Selection Files.................   42.016
Compliance Programs and Projects Files.........................   42.021
International Enforcement Program Files........................   42.017
Combined Case Control Files....................................   42.012
Audit Underreporter Case Files.................................   42.029
Discriminant Function File (DIF)...............................   42.030
Appeals Case Files.............................................   44.001
Automated Information Analysis System..........................   46.050
Disclosure Records.............................................   48.001
Collateral and Information Requests System.....................   49.001
Component Authority and Index Card Mircofilm Retrieval System..   49.002
Overseas Compliance Projects System............................   49.007
Conduct Investigation Files....................................   60.003
Enrollee Charge Investigation Files............................   60.006
Miscellaneous Information File.................................   60.007
Special Inquiry Investigation Files............................   60.009
Chief Counsel Disclosure Litigation Division Case Files........   90.002
Chief Counsel General Legal Services Case Files................   90.004
Chief Counsel General Litigation Case Files....................   90.005
Chief Counsel Tax Litigation Case Files........................   90.009
File Digest Room Files containing briefs, Legal opinions,         90.010
 Digests of Documents generated internally or by the Department
 of Justice relating to the Administration of the Revenue Laws.
Legal Case Files of the Chief Counsel, Deputy Chief Counsel,      90.013
 Associate Chief Counsels (Litigation) and (Technical).........
Reports and Information Retrieval Activity Computer and           90.016
 Microfilm Records.............................................
Correspondence File--Inquiries about Enforcement Activities....   00.002
------------------------------------------------------------------------

    (2) Under 5 U.S.C. 552a (k)(2), the head of any agency may 
promulgate rules to exempt any system of records within the agency from 
certain provisions of the Privacy Act of 1974 if the system is 
investigatory material compiled for law enforcement purposes. To the 
extent that information contained in the above-named systems has as its 
principal purpose the enforcement of criminal laws, exemption for such 
information under 5 U.S.C. 552a (j)(2) is hereby claimed.
    (3) The provisions of the Privacy Act of 1974 from which exemptions 
are claimed under 5 U.S.C. 552a(k)(2) are as follows:

5 U.S.C. 552a(c)(3)
5 U.S.C. 552a(d) (1), (2), (3), and (4)

[[Page 63]]

5 U.S.C. 552a (e)(1)
5 U.S.C. 552a(e)(4) (G), (H), and (I)
5 U.S.C. 552a(f)

    (4) See paragraph (c) for reasons for the exemptions.
    (c) Reasons for exemptions. The following are the reasons for 
exempting systems of records maintained by the Internal Revenue Service 
pursuant to 5 U.S.C. 552a (j)(2) and (k)(2) of the Privacy Act of 1974.
    (1) 5 U.S.C. 552a(c)(3). This provision of the Privacy Act provides 
for the release of the disclosure accounting required by 5 U.S.C. 
552a(c) (1) and (2) to the individual named in the record at his 
request. The reasons for exempting systems of records from the foregoing 
provision are as follows:
    (i) The release of disclosure accounting would put the subject of an 
investigation on notice of the existence of an investigation and that 
such person is the subject of that investigation;
    (ii) Such release would provide the subject of an investigation with 
an accurate accounting of the date, nature, and purpose of each 
disclosure and the name and address of the person or agency to whom the 
disclosure is made. The release of such information to the subject of an 
investigation would provide the subject with significant information 
concerning the nature of the investigation and could result in the 
altering or destruction of documentary evidence, the improper 
influencing of witnesses, and other activities that could impede or 
compromise the investigation. In the case of a delinquent account, such 
release might enable the subject of the investigation to dissipate 
assets before levy;
    (iii) Release to the individual of the disclosure accounting would 
alert the individual as to which agencies were investigating this person 
and the scope of the investigation, and could aid the individual in 
impeding or compromising investigations by those agencies.
    (2) 5 U.S.C. 552a (c)(4), (d)(1), (2), (3), and (4), (e)(4) (G) and 
(H), (f), and (g). These provisions of the Privacy Act relate to an 
individual's right to notification of the existence of records 
pertaining to such individual; requirements for identifying an 
individual who requests access to records; the agency procedures 
relating to access to records and the contest of the information 
contained in such records; and the civil remedies available to the 
individual in the event of adverse determinations by an agency 
concerning access to or amendment of information contained in record 
systems. The reasons for exempting systems of records from the foregoing 
provisions are as follows: To notify an individual at the individual's 
request of the existence of records in an investigative file pertaining 
to such individual or to grant access to an investigative file could 
interfere with investigative and enforcement proceedings; deprive co-
defendants of a right to a fair trial or an impartial adjudication; 
constitute an unwarranted invasion of the personal privacy of others; 
disclose the identity of confidential sources and reveal confidential 
information supplied by such sources; and disclose investigative 
techniques and procedures.
    (3) 5 U.S.C. 552a(e)(4)(I). This provision of the Privacy Act 
requires the publication of the categories of sources of records in each 
system of records. In cases where an exemption from this provision has 
been claimed, the reasons are as follows:
    (i) Revealing categories of sources of information could disclose 
investigative techniques and procedures;
    (ii) Revealing categories of sources of information could cause 
sources who supply information to investigators to refrain from giving 
such information because of fear of reprisal, or fear of breach of 
promises of anonymity and confidentiality.
    (4) 5 U.S.C. 552a(e)(1). This provision of the Privacy Act requires 
each agency to maintain in its records only such information about an 
individual as is relevant and necessary to accomplish a purpose of the 
agency required to be accomplished by statute or executive order. The 
reasons for exempting systems of records from the foregoing provision 
are as follows:
    (i) The Internal Revenue Service will limit its inquiries to 
information which is necessary for the enforcement and administration of 
tax laws. However, an exemption from the foregoing provision is needed 
because, particularly in the early stages of a tax audit

[[Page 64]]

or other investigation, it is not possible to determine the relevance or 
necessity of specific information.
    (ii) Relevance and necessity are questions of judgment and timing. 
What appears relevant and necessary when collected may subsequently be 
determined to be irrelevant or unnecessary. It is only after the 
information is evaluated that the relevance and necessity of such 
information can be established with certainty.
    (iii) When information is received by the Internal Revenue Service 
relating to violations of law within the jurisdiction of other agencies, 
the Service processes this information through Service systems in order 
to forward the material to the appropriate agencies.
    (5) 5 U.S.C. 552a(e)(2). This provision of the Privacy Act requires 
an agency to collect information to the greatest extent practicable 
directly from the subject individual when the information may result in 
adverse determinations about an individual's rights, benefits, and 
privileges under Federal programs. The reasons for exempting systems of 
records from the foregoing provisions are as follows:
    (i) In certain instances the subject of a criminal investigation 
cannot be required to supply information to investigators. In those 
instances, information relating to a subject's criminal activities must 
be obtained from other sources;
    (ii) In a criminal investigation it is necessary to obtain evidence 
from a variety of sources other than the subject of the investigation in 
order to accumulate and verify the evidence necessary for the successful 
prosecution of persons suspected of violating the criminal laws.
    (6) 5 U.S.C. 552a(e)(3). This provision of the Privacy Act requires 
that an agency must inform the subject of an investigation who is asked 
to supply information of (A) the authority under which the information 
is sought and whether disclosure of the information is mandatory or 
voluntary, (B) the purposes for which the information is intended to be 
used, (C) the routine uses which may be made of the information, and (D) 
the effects on the subject, if any, of not providing the requested 
information. The reasons for exempting systems of records from the 
foregoing provision are as follows:
    (i) The disclosure to the subject of an investigation of the 
purposes for which the requested information is intended to be used 
would provide the subject with significant information concerning the 
nature of the investigation and could result in impeding or compromising 
the investigation.
    (ii) Informing the subject of an investigation of the matters 
required by this provision could seriously undermine the actions of 
undercover officers, requiring them to disclose their identity and 
impairing their safety, as well as impairing the successful conclusion 
of the investigation.
    (iii) Individuals may be contacted during preliminary information 
gathering, surveys, or compliance projects concerning the administration 
of the internal revenue laws before any individual is identified as the 
subject of an investigation. Informing the individual of the matters 
required by this provision would impede or compromise subsequent 
investigations.
    (7) 5 U.S.C. 552a(e)(5). This provision of the Privacy Act requires 
an agency to maintain all records which are used in making any 
determination about an individual with such accuracy, relevance, 
timeliness, and completeness as is reasonably necessary to assure 
fairness to the individual in the determination. The reasons for 
exempting systems of records from the foregoing provision are as 
follows: Since the law defines ``maintain'' to include the collection of 
information, compliance with the foregoing provision would prohibit the 
initial collection of any data not shown to be accurate, relevant, 
timely, and complete at the moment of its collection. In gathering 
information during the course of a criminal investigation, it is not 
feasible or possible to determine completeness, accuracy, timeliness, or 
relevancy prior to collection of the information. Facts are first 
gathered and then placed into a cohesive order which objectively proves 
or disproves criminal behavior on the part of a suspect. Seemingly 
nonrelevant, untimely, or incomplete information

[[Page 65]]

when gathered may acquire new significance as an investigation 
progresses. The restrictions of the foregoing provision could impede 
investigators in the preparation of a complete investigative report.
    (8) 5 U.S.C. 552a(e)(8). This provision of the Privacy Act requires 
an agency to make reasonable efforts to serve notice on an individual 
when any record on such individual is made available to any person under 
compulsory legal process when such process becomes a matter of public 
record. The reasons for exempting systems of records from the foregoing 
provision are as follows: The notice requirement of the foregoing 
provision could prematurely reveal the existence of criminal 
investigations to individuals who are the subject of such 
investigations.
    (d) Exemption under 5 U.S.C. 552a (k)(4). (1) This paragraph applies 
to the following system of records maintained by the Internal Revenue 
Service, for which exemption is claimed under 5 U.S.C. 552a(k)(4): 
Statistics of Income--Individual Tax Returns 70.001.
    (2) Under 5 U.S.C. 552a(k)(4), the head of any agency may promulgate 
rules to exempt any system of records within the agency from certain 
provisions of the Privacy Act of 1974 if the system is required by 
statute to be maintained and used solely as statistical records.
    (3) The above-named system is maintained under section 6108 of the 
Internal Revenue Code, which provides that ``the Secretary or his 
delegate shall prepare and publish annually statistics reasonably 
available with respect to the operation of the income tax laws, 
including classifications of taxpayers and of income, the amounts 
allowed as deductions, exemptions, and credits, and any other facts 
deemed pertinent and valuable''.
    (4) The reason for exempting the above-named system of records is 
that disclosure of statistical records (including release of accounting 
for disclosures) would in most instances be of no benefit to a 
particular individual since the records do not have a direct effect on a 
given individual.
    (5) The provisions of the Privacy Act of 1974 from which exemption 
is claimed under 5 U.S.C. 552a(k)(4) are as follows:

5 U.S.C. 552a(c)(3)
5 U.S.C. 552a(d) (1), (2), (3), and (4)
5 U.S.C. 552a(e)(1)
5 U.S.C. 552a(e)(4) (G), (H), and (I)
5 U.S.C. 552a(f)

    (e) Exemptions under 5 U.S.C. 552a (k)(5). (1) This paragraph 
applies to the following systems of records maintained by the Internal 
Revenue Service, for which exemptions are claimed under 5 U.S.C. 
552a(k)(5):

------------------------------------------------------------------------
                         Name of system                            No.
------------------------------------------------------------------------
Recruiting, Examining and Placement Records....................   36.008
Security, Background, and Character Investigations Files.......   60.008
Chief Counsel General Administrative Systems...................   90.003
Employee Recruiting Files Maintained by the Operations Division   90.011
Management Files Maintained by Operations Division and the        90.014
 Deputy Chief Counsel other than the Office of Personnel
 Management's Official Personnel Files.........................
------------------------------------------------------------------------

    (2) Under 5 U.S.C. 552a(k)(5), the head of any agency may promulgate 
rules to exempt any system of records within the agency from certain 
provisions of the Privacy Act of 1974 if the system is investigatory 
material compiled solely for the purpose of determining suitability, 
eligibility, and qualifications for Federal civilian employment or 
access to classified information, but only to the extent that the 
disclosure of such material would reveal the identity of a source who 
furnished information to the Government under an express promise that 
the identity of the source would be held in confidence, or, prior to 
September 27, 1975, under an implied promise that the identity of the 
source would be held in confidence. Thus, to the extent that records in 
the above-named systems can be disclosed without revealing the identity 
of a confidential source, they are not within the scope of this 
exemption and are subject to all the requirements of the Privacy Act.
    (3) The provisions of the Act from which exemptions are claimed for 
the above-named systems of records are in general those providing for 
individual access to records. When such access would cause the identity 
of a confidential source to be revealed, it would impair the future 
ability of the Service to compile investigatory material for the purpose 
of determining suitability, eligibility, or qualifications for Federal

[[Page 66]]

civilian employment, Federal contracts, or access to classified 
information. In addition, the systems are to be exempt from 5 U.S.C. 
552a(e)(1), which requires that the agency maintain in its records only 
such information about an individual as is relevant and necessary to 
accomplish a statutory or executively ordered purpose. The Service finds 
that to fulfill the requirements of 5 U.S.C. 552a(e)(1) would unduly 
restrict the agency in its information gathering inasmuch as it is often 
not until well after the investigation that it is possible to determine 
the relevance and necessity of particular information.
    (4) If any investigatory material contained in the above-named 
systems becomes involved in criminal or civil matters, exemptions of 
such material under 5 U.S.C. 552a (j)(2) or (k)(2) is hereby claimed.
    (5) The provisions of the Privacy Act of 1974 from which exemptions 
are claimed under 5 U.S.C. 552a(k)(5) are as follows:

5 U.S.C. 552a(c)(3)
5 U.S.C. 552a (d) (1), (2), (3), and (4)
5 U.S.C. 552a(e)(1)
5 U.S.C. 552a(e)(4) (G), (H), and (I)
5 U.S.C. 552a (f)

    (f) Exemption under 5 U.S.C. 552a(k)(6). (1) This paragraph applies 
to the following system of records maintained by the Internal Revenue 
Service, for which exemption is claimed under 5 U.S.C. 552a(k)(6): 
Recruiting, Examining and Placement Records 36.008
    (2) Under 5 U.S.C. 552a(k)(6), the head of any agency may promulgate 
rules to exempt any system of records that is testing or examination 
material used solely to determine individual qualifications for 
appointment or promotion in the Federal service the disclosure of which 
would compromise the objectivity or fairness of the testing or 
examination process.
    (3) The reason for exempting the above-named system is that 
disclosure of the material in the system would compromise the 
objectivity or fairness of the examination process.
    (4) The provisions of the Privacy Act of 1974 from which exemptions 
are claimed under 5 U.S.C. 552a(k)(6) are as follows:

5 U.S.C. 552a(c)(3)
5 U.S.C. 552a(d)(1), (2), (3), and (4)
5 U.S.C. 552a(e)(1)
5 U.S.C. 552a(e)(4) (G), (H), and (I)
5 U.S.C. 552a (f)

    (g) Exempt information included in another system. Any information 
from a system of records for which an exemption is claimed under 5 
U.S.C. 552a (j) or (k) which also is included in another system of 
records retains the same exempt status such information has in the 
system for which such exemption is claimed.

                      United States Customs Service

                        notice of exempt systems

    In accordance with 5 U.S.C. 552a (j) and (k), general notice is 
hereby given of rulemaking pursuant to the Privacy Act of 1974 by the 
Commissioner, United States Customs Service, under authority delegated 
to him by the Secretary of the Treasury. The Commissioner, United States 
Customs Service, exempts the systems of records identified in the 
paragraphs below from certain provisions of the Privacy Act of 1974 as 
set forth in such paragraphs.
    a. General exemptions under 5 U.S.C. 552a(j)(2). Pursuant to the 
provisions of 5 U.S.C. 552a(j)(2), the Commissioner, United States 
Customs Service, hereby exempts certain systems of records, maintained 
by the United States Customs Service, from the provisions of 5 U.S.C. 
552a(c) (3) and (4), (d) (1), (2), (3) and (4), (e)(1), (2), (3), 
(4)(G), (H) and (I), (5) and (8), (f) and (g).
    1. Exempt systems. The following systems of records, which contain 
information of the type described in 5 U.S.C. 552a(j)(2), shall be 
exempt from the provisions of 5 U.S.C. 552a listed in paragraph a. above 
except as otherwise indicated below and in the general notice of the 
existence and character of systems of records which appears elsewhere in 
the Federal Register:

00.285--Automated Index to Central Enforcement Files
00.270--Background--Record File of Non-Customs Employees
00.067--Bank Secrecy Act Reports File
00.037--Cargo Security Record System
00.053--Confidential Source Identification File
00.287--Customs Automated Licensing Information System (CALIS) 
[Proposed]
00.127--Internal Security Records System
00.129--Investigations Record System

[[Page 67]]

00.171--Pacific Basin Reporting Network
00.213--Seized Asset and Case Tracking System (SEACATS)
00.244--Treasury Enforcement Communications System (TECS)

    2. Reasons for exemptions, (a) 5 U.S.C. 552a (e)(4)(G) and (f)(1) 
enable individuals to be notified whether a system of records contains 
records pertaining to them. The Customs Service believes that 
application of these provisions to the above-listed systems of records 
would give individuals an opportunity to learn whether they are of 
record either as suspects or as subjects of a criminal investigation; 
this would compromise the ability of the Customs Service to complete 
investigations and to detect and apprehend violators of the Customs and 
related laws in that individuals would thus be able (1) to take steps to 
avoid detection, (2) to inform co-conspirators of the fact that an 
investigation is being conducted, (3) to learn the nature of the 
investigation to which they are being subjected, (4) to learn the type 
of surveillance being utilized, (5) to learn whether they are only 
suspects or identified law violators, (6) to continue or resume their 
illegal conduct without fear of detection upon learning that they are 
not in a particular system of records, and (7) to destroy evidence 
needed to prove the violation.
    (b) 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f) (2), (3) and (5) enable 
individuals to gain access to records pertaining to them. The Customs 
Service believes that application of these provisions to the above-
listed systems of records would compromise its ability to complete or 
continue criminal investigations and to detect and apprehend violators 
of the Customs and related criminal laws. Permitting access to records 
contained in the above-listed systems of records would provide 
individuals with significant information concerning the nature of the 
investigation, and this could enable them to avoid detection or 
apprehension in the following ways: (1) By discovering the collection of 
facts which would form the basis for their arrest, (2) by enabling them 
to destroy contraband or other evidence of criminal conduct which would 
form the basis for their arrest and, (3) by learning that the criminal 
investigators had reason to believe that a crime was about to be 
committed, they could delay the commission of the crime or change the 
scene of the crime to a location which might not be under surveillance. 
Granting access to on-going or closed investigative files would also 
reveal investigative techniques and procedures, the knowledge of which 
could enable individuals planning criminal activity to structure their 
future operations in such a way as to avoid detection or apprehension, 
thereby neutralizing law enforcement officer's established investigative 
tools and procedures. Further, granting access to investigative files 
and records could disclose the identity of confidential sources and 
other informers and the nature of the information which they supplied, 
thereby endangering the life or physical safety of those sources of 
information by exposing them to possible reprisals for having provided 
information relating to the criminal activities of those individuals who 
are the subjects of the investigative files and records; confidential 
sources and other informers might refuse to provide criminal 
investigators with valuable information if they could not be secure in 
the knowledge that their identities would not be revealed through 
disclosure of either their names or the nature of the information they 
supplied, and this would seriously impair the ability of the Customs 
Service to carry out its mandate to enforce the Customs criminal and 
related laws. Additionally, providing access to records contained in the 
above-listed systems of records could reveal the identities of 
undercover law enforcement officers who compiled information regarding 
individual's criminal activities, thereby endangering the life or 
physical safety of those undercover officers or their families by 
exposing them to possible reprisals.
    (c) 5 U.S.C. 552a(d) (2), (3) and (4), (e)(4)(H) and (f)(4), which 
are dependent upon access having been granted to records pursuant to the 
provisions cited in paragraph (b) above, enable individuals to contest 
(seek amendment to) the content of records contained in a system of 
records and require an agency to note an amended record and to provide a 
copy of an individual's

[[Page 68]]

statement (of disagreement with the agency's refusal to amend a record) 
to persons or other agencies to whom the record has been disclosed. The 
Customs Service believes that the reasons set forth in paragraph (b) 
above are equally applicable to this subparagraph and, accordingly, 
those reasons are hereby incorporated herein by reference.
    (d) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of 
disclosures of records available to individuals named in the records at 
their request; such accountings must state the date, nature and purpose 
of each disclosure of a record and the name and address of the 
recipient. The Customs Service believes that application of this 
provision to the above-listed systems of records would impair the 
ability of other law enforcement agencies to make effective use of 
information provided by the Customs Service in connection with the 
investigation, detection and apprehension of violators of the criminal 
laws enforced by those other law enforcement agencies. Making 
accountings of disclosure available to violators would alert those 
individuals to the fact that another agency is conducting an 
investigation into their criminal activities, and this could reveal the 
geographic location of the other agency's investigation, the nature and 
purpose of that investigation, and the dates on which that investigation 
was active. Violators possessing such knowledge would thereby be able to 
take appropriate measures to avoid detection or apprehension by altering 
their operations, by transferring their criminal activities to other 
geographical areas or by destroying or concealing evidence which would 
form the basis for their arrest. In addition, providing violators with 
accountings of disclosure would alert those individuals to the fact that 
the Customs Service has information regarding their criminal activities 
and could inform those individuals of the general nature of that 
information; this, in turn, would afford those individuals a better 
opportunity to take appropriate steps to avoid detection or apprehension 
for violations of the Customs and related criminal laws.
    (e) 5 U.S.C. 552a(c)(4) requires that an agency inform any person or 
other agency about any correction or notation of dispute made by the 
agency in accordance with 5 U.S.C. 552a(d) of any record that has been 
disclosed to the person or agency if an accounting of the disclosure was 
made. Since this provision is dependent on an individual's having been 
provided an opportunity to contest (seek amendment to) records 
pertaining to him, and since the above-listed systems of records are 
proposed to be exempted from those provisions of 5 U.S.C. 552a relating 
to amendments of records as indicated in paragraph (c) above, the 
Customs Service believes that this provision should not be applicable to 
the above-listed systems of records.
    (f) 5 U.S.C. 552a(e)(4)(I) requires that an agency publish a public 
notice listing the categories of sources for information contained in a 
system of records. The Customs Service believes that application of this 
provision to the above-listed systems of records could compromise its 
ability to conduct investigations and to identify, detect and apprehend 
violators of the Customs and related criminal laws for the reasons that 
revealing sources for information could 1) disclose investigative 
techniques and procedures, 2) result in threatened or actual reprisal 
directed to informers by the subject under investigation, and 3) result 
in the refusal of informers to give information or to be candid with 
criminal investigators because of the knowledge that their identities as 
sources might be disclosed.
    (g) 5 U.S.C. 552a(e)(1) requires that an agency maintain in its 
records only such information about an individual as is relevant and 
necessary to accomplish a purpose of the agency required to be 
accomplished by statute or executive order. The term ``maintain'' as 
defined in 5 U.S.C. 552a(a)(3) includes ``collect'' and ``disseminate.'' 
At the time that information is collected by the Customs Service, there 
is often insufficient time to determine whether the information is 
relevant and necessary to accomplish a purpose of the Customs Service; 
in many cases information collected may not be immediately susceptible 
to a determination of whether the information is relevant and necessary, 
particularly in the early

[[Page 69]]

stages of investigation, and in many cases information which initially 
appears to be irrelevant and unnecessary may, upon further evaluation or 
upon continuation of the investigation, prove to have particular 
relevance to an enforcement program of the Customs Service. Further, not 
all violations of law discovered during a Customs Service criminal 
investigation fall within the investigative jurisdiction of the Customs 
Service; in order to promote effective law enforcement, it often becomes 
necessary and desirable to disseminate information pertaining to such 
violations to other law enforcement agencies which have jurisdiction 
over the offense to which the information relates. The Customs Service 
should not be placed in a position of having to ignore information 
relating to violations of law not within its jurisdiction where that 
information comes to the attention of the Customs Service through the 
conduct of a lawful Customs Service investigation. The Customs Service 
therefore believes that it is appropriate to exempt the above-listed 
systems of records from the provisions of 5 U.S.C. 552a(e)(1).
    (h) 5 U.S.C. 552a(e)(2) requires that an agency collect information 
to the greatest extent practicable directly from the subject individual 
when the information may result in adverse determinations about an 
individual's rights, benefits, and privileges under Federal programs. 
The Customs Service believes that application of this provision to the 
above-listed systems of records would impair the ability of the Customs 
Service to conduct investigations and to identify, detect and apprehend 
violators of the Customs and related criminal laws for the following 
reasons: (1) most information collected about an individual under 
criminal investigation is obtained from third parties such as witnesses 
and informers, and it is usually not feasible to rely upon the subject 
of the investigation as a source for information regarding his criminal 
activities, (2) an attempt to obtain information from the subject of a 
criminal investigation will often alert that individual to the existence 
of an investigation, thereby affording the individual an opportunity to 
attempt to conceal his criminal activities so as to avoid apprehension, 
(3) in certain instances the subject of a criminal investigation is not 
required to supply information to criminal investigators as a matter of 
legal duty, and (4) during criminal investigations it is often a matter 
of sound investigative procedure to obtain information from a variety of 
sources in order to verify information already obtained.
    (i) 5 U.S.C. 552a(e)(3) requires that an agency inform each 
individual whom it asks to supply information, on the form which it uses 
to collect the information or on a separate form that can be retained by 
the individual: the authority which authorizes the solicitation of the 
information and whether disclosure of such information is mandatory or 
voluntary; the principal purposes for which the information is intended 
to be used; the routine uses which may be made of the information; and 
the effects on the individual of not providing all or part of the 
requested information. The Customs Service believes that the above-
listed systems of records should be exempted from this provision in 
order to avoid adverse effects on its ability to identify, detect and 
apprehend violators of the Customs and related criminal laws. In many 
cases information is obtained by confidential sources or other informers 
or by undercover law enforcement officers under circumstances where it 
is necessary that the true purpose of their actions be kept secret so as 
to not let it be known by the subject of the investigation or his 
associates that a criminal investigation is in progress. Further, if it 
became known that the undercover officer was assisting in a criminal 
investigation, that officer's life or physical safety could be 
endangered through reprisal, and, further, under such circumstances it 
may not be possible to continue to utilize that officer in the 
investigation. In many cases individuals for personal reasons would feel 
inhibited in talking to a person representing a criminal law enforcement 
agency but would be willing to talk to a confidential source or 
undercover officer who they believed was not involved in law enforcement 
activities. In addition, providing a source of information with written 
evidence that he was a source, as required by this

[[Page 70]]

provision, could increase the likelihood that the source of information 
would be the subject of retaliatory action by the subject of the 
investigation. Further, application of this provision could result in an 
unwarranted invasion of the personal privacy of the subject of the 
criminal investigation, particularly where further investigation would 
result in a finding that the subject was not involved in any criminal 
activity.
    (j) 5 U.S.C. 552a(e)(5) requires that an agency maintain all records 
used by the agency in making any determination about any individual with 
such accuracy, relevance, timeliness and completeness as is reasonably 
necessary to assure fairness to the individual in the determination. 
Since 5 U.S.C. 552a(a)(3) defines ``maintain'' to include ``collect'' 
and ``disseminate,'' application of this provision to the above-listed 
systems of records would hinder the initial collection of any 
information which could not, at the moment of collection, be determined 
to be accurate, relevant, timely and complete. Similarly, application of 
this provision would seriously restrict the necessary flow of 
information from the Customs Service to other law enforcement agencies 
where a Customs Service investigation revealed information pertaining to 
a violation of law which was under the investigative jurisdiction of 
another agency. In collecting information during the course of a 
criminal investigation, it is not possible or feasible to determine 
accuracy, relevance, timeliness or completeness prior to collection of 
the information; in disseminating information to other law enforcement 
agencies it is often not possible to determine accuracy, relevance, 
timeliness or completeness prior to dissemination because the 
disseminating agency may not have the expertise with which to make such 
determinations. Further, information which may initially appear to be 
inaccurate, irrelevant, untimely or incomplete may, when gathered, 
grouped, and evaluated with other available information, become more 
pertinent as an investigation progresses. In addition, application of 
this provision could seriously impede criminal investigators and 
intelligence analysts in the exercise of their judgment in reporting on 
results obtained during criminal investigations. The Customs Service 
therefore believes that it is appropriate to exempt the above-listed 
systems of records from the provisions of 5 U.S.C. 552a(e)(5).
    (k) 5 U.S.C. 552a(e)(8) requires that an agency make reasonable 
efforts to serve notice on an individual when any record on the 
individual is made available to any person under compulsory legal 
process when such process becomes a matter of public record. The Customs 
Service believes that the above-listed systems of records should be 
exempt from this provision in order to avoid revealing investigative 
techniques and procedures outlined in those records and in order to 
prevent revelation of the existence of an on-going investigation where 
there is a need to keep the existence of the investigation secret.
    (l) 5 U.S.C. 552a(g) provides civil remedies to an individual for an 
agency refusal to amend a record or to make a review of a request for 
amendment, for an agency refusal to grant access to a record, for an 
agency failure to maintain accurate, relevant, timely and complete 
records which are used to make a determination which is adverse to the 
individual, and for an agency failure to comply with any other provision 
of 5 U.S.C. 552a in such a way as to have an adverse effect on an 
individual. The Customs Service believes that the above-listed systems 
of records should be exempted from this provision to the extent that the 
civil remedies provided therein may relate to provisions of 5 U.S.C. 
552a from which the above-listed systems of records are proposed to be 
exempt. Since the provisions of 5 U.S.C. 552a enumerated in paragraphs 
(a) through (k) above are proposed to be inapplicable to the above-
listed systems of records for the reasons stated therein, there should 
be no corresponding civil remedies for failure to comply with the 
requirements of those provisions to which the exemption is proposed to 
apply. Further, the Customs Service believes that application of this 
provision to the above-listed systems of records would adversely affect 
its ability to conduct criminal investigations by exposing to civil 
court

[[Page 71]]

action every stage of the criminal investigative process in which 
information is compiled or used in order to identify, detect, apprehend 
and otherwise investigate persons suspected or known to be engaged in 
criminal conduct in violation of the Customs and related laws.
    b. Specific exemptions under 5 U.S.C. 552a(k) (2). Pursuant to the 
provisions of 5 U.S.C. 552a(k)(2), the Commissioner, United States 
Customs Service, hereby exempts certain systems of records, maintained 
by the United States Customs Service, from the provisions of 5 U.S.C. 
552a(c)(3), (d) (1), (2), (3) and (4), (e) (1) and (4) (G), (H) and (I) 
and (f).
    1. Exempt systems. The following systems of records, which contain 
information of the type described in 5 U.S.C. 552a(k)(2), shall be 
exempt from the provisions of 5 U.S.C. 552a listed in paragraph b. above 
except as otherwise indicated below and in the general notice of the 
existence and character of systems of records which appears elsewhere in 
the Federal Register:

00.014--Advice Requests (Legal) (Pacific Region)
00.021--Arrest/Seizure/Search Report and Notice of Penalty File
00.022--Attorney Case File
00.285--Automated Index to Central Enforcement Files
00.270--Background--Record File of Non-Customs Employees
00.067--Bank Secrecy Act Reports File
00.037--Cargo Security File
00.271--Cargo Security Record System
00.041--Cartmen or Lightermen
00.043--Case Files (Regional Counsel--South Central Region)
 00.046--Claims Case File
00.053--Confidential Source Identification File
 00.057--Container Station Operator Files
00.058--Cooperating Individual Files
00.061--Court Case File
00.069--Customhouse Brokers File (Chief Counsel)
00.287--Customs Automated Licensing Information System (CALIS)
00.077--Disciplinary Action and Resulting Grievances or Appeal Case 
Files
00.078--Disclosure of Information File
00.098--Fines, Penalties, and Forfeitures Records 
00.099--Fines, Penalties, and Forfeiture Files (Supplemental Petitions)
00.100--Fines, Penalties, and Forfeiture Records (Headquarters)
00.122--Information Received File
00.125--Intelligence Log
00.127--Internal Security Records System
00.129--Investigations Record System
00.133--Justice Department Case File
00.138--Litigation Issue Files
00.140--Lookout Notice
00.155--Narcotics Suspect File
00.159--Notification of Personnel Management Division when an employee 
is placed under investigation by the Office of Internal Affairs.
00.171--Pacific Basin Reporting Network
00.182--Penalty Case File
00.186--Personal Search
00.190--Personal Case File
00.197--Private Aircraft/Vessel Inspection Reporting System
00.206--Regulatory Audits of Customhouse Brokers
00.212--Search/Arrest/Seizure Report
00.13--Seized Asset and Case Tracking Sytem (SEACATS)
00.214--Seizure File
00.224--Suspect Persons Index
00.232--Tort Claims Act File
00.244--Treasury Enforcement Communications System (TECS)
00.258--Violator's Case Files
00.260--Warehouse Proprietor Files

    2. Reasons for exemptions. (a) 5 U.S.C. 552a (e)(4)(G) and (f)(1) 
enable individuals to be notified whether a system of records contains 
records pertaining to them. The Customs Service believes that 
application of these provisions (to those of the above-listed systems of 
records for which no notification procedures have been provided in the 
general notice of the existence and character of systems of records 
which appears elsewhere in the Federal Register) would impair the 
ability of the Customs Service to successfully complete investigations 
and inquires of suspected violators of civil and criminal laws and 
regulations under its jurisdiction. In many cases investigations and 
inquiries into violations of civil and criminal laws and regulations 
involve complex and continuing patterns of behavior. Individuals, if 
informed that they have been identified as suspected violators of civil 
or criminal laws and regulations, would have an opportunity to take 
measures to prevent detection of illegal action so as to avoid 
prosecution or the imposition of civil sanctions. They would also be 
able to learn the nature and location of the investigation or inquiry 
and the type of surveillance being utilized, and they would be able to 
transmit this knowledge to co-conspirators. Finally, violators might be 
given the opportunity to destroy evidence needed to prove the

[[Page 72]]

violation under investigation or inquiry.
    (b) 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f) (2), (3) and (5) enable 
individuals to gain access to records pertaining to them. The Customs 
Service believes that application of these provisions to the above-
listed systems of records would impair its ability to complete or 
continue civil or criminal investigations and inquiries and to detect 
and apprehend violators of the Customs and related laws. Permitting 
access to records contained in the above-listed systems of records would 
provide violators with significant information concerning the nature of 
the civil or criminal investigation or inquiry. Knowledge of the facts 
developed during an investigation or inquiry would enable violators of 
criminal and civil laws and regulations to learn the extent to which the 
investigation or inquiry has progressed, and this could provide them 
with an opportunity to destroy evidence that would form the basis for 
prosecution or the imposition of civil sanctions. In addition, knowledge 
gained through access to investigatory material could alert a violator 
to the need to temporarily postpone commission of the violation or to 
change the intended point where the violation is to be committed so as 
to avoid detection or apprehension. Further, access to investigatory 
material would disclose investigative techniques and procedures which, 
if known, could enable violators to structure their future operations in 
such a way as to avoid detection or apprehension, thereby neutralizing 
investigators' established and effective investigative tools and 
procedures. In addition, investigatory material may contain the identity 
of a confidential source of information or other informer who would not 
want his identity to be disclosed for reasons of personal privacy or for 
fear of reprisal at the hands of the individual about whom he supplied 
information. In some cases mere disclosure of the information provided 
by an informer would reveal the identity of the informer either through 
the process of elimination or by virtue of the nature of the information 
supplied. If informers cannot be assured that their identities (as 
sources for information) will remain confidential, they would be very 
reluctant in the future to provide information pertaining to violations 
of criminal and civil laws and regulations, and this would seriously 
compromise the ability of the Customs Service to carry out its mission. 
Further, application of 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f) (2), (3) 
and (5) to the above-listed systems of records would make available 
attorney's work product and other documents which contain evaluations, 
recommendations, and discussions of ongoing civil and criminal legal 
proceedings; the availability of such documents could have a chilling 
effect on the free flow of information and ideas within the Customs 
Service which is vital to the agency's predecisional deliberative 
process, could seriously prejudice the agency's or the Government's 
position in a civil or criminal litigation, and could result in the 
disclosure of investigatory material which should not be disclosed for 
the reasons stated above. It is the belief of the Customs Service that, 
in both civil actions and criminal prosecutions, due process will assure 
that individuals have a reasonable opportunity to learn of the existence 
of, and to challenge, investigatory records and related materials which 
are to be used in legal proceedings.
    (c) 5 U.S.C. 552a(d) (2), (3) and (4), (e)(4)(H) and (f)(4), which 
are dependent upon access having been granted to records pursuant to the 
provisions cited in subparagraph (b) above, enable individuals to 
contest (seek amendment to) the content of records contained in a system 
of records and require an agency to note an amended record and to 
provide a copy of an individual's statement (of disagreement with the 
agency's refusal to amend a record) to persons or other agencies to whom 
the record has been disclosed. The Customs Service believes that the 
reasons set forth in subparagraph (b) above are equally applicable to 
this subparagraph, and, accordingly, those reasons are hereby 
incorporated herein by reference.
    (d) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of 
disclosures of records available to individuals named in the records at 
their request; such accountings must state the

[[Page 73]]

date, nature and purpose of each disclosure of a record and the name and 
address of the recipient. The Customs Service believes that application 
of this provision to the above-listed systems of records would impair 
the ability of the Customs Service and other law enforcement agencies to 
conduct investigations and inquiries into civil and criminal violations 
under their respective jurisdictions. Making accountings available to 
violators would alert those individuals to the fact that the Customs 
Service or another law enforcement authority is conducting an 
investigation or inquiry into their activities, and such accountings 
could reveal the geographic location of the investigation or inquiry, 
the nature and purpose of the investigation or inquiry and the nature of 
the information disclosed, and the dates on which that investigation or 
inquiry was active. Violators possessing such knowledge would thereby be 
able to take appropriate measures to avoid detection or apprehension by 
altering their operations, transferring their activities to other 
locations or destroying or concealing evidence which would form the 
basis for prosecution or the imposition of civil sanctions.
    (e) 5 U.S.C. 552a(e)(1) requires that an agency maintain in its 
records only such information about an individual as is relevant and 
necessary to accomplish a purpose of the agency required to be 
accomplished by statute or executive order. The term ``maintain'' as 
defined in 5 U.S.C. 552a(a)(3) includes ``collect'' and ``disseminate.'' 
At the time that information is collected by the Customs Service there 
is often insufficient time to determine whether the information is 
relevant and necessary to accomplish a purpose of the Customs Service; 
in many cases information collected may not be immediately susceptible 
to a determination of whether the information is relevant and necessary, 
particularly in the early stages of investigation or inquiry, and in 
many cases information which initially appears to be irrelevant and 
unnecessary may, upon further evaluation or upon continuation of the 
investigation or inquiry, prove to have particular relevance to an 
enforcement program of the Customs Service. Further, not all violations 
of law uncovered during a Customs Service investigation or inquiry fall 
within the civil or criminal jurisdiction of the Customs Service; in 
order to promote effective law enforcement it often becomes necessary 
and desirable to disseminate information pertaining to such violations 
to other law enforcement agencies which have jurisdiction over the 
offense to which the information relates. The Customs Service should not 
be placed in a position of having to ignore information relating to 
violations of law not within its jurisdiction where that information 
comes to the attention of the Customs Service through the conduct of a 
lawful Customs Service civil or criminal investigation or inquiry. The 
Customs Service therefore believes that it is appropriate to exempt the 
above-listed systems of records from the provisions of 5 U.S.C. 
552a(e)(1).
    c. Specific exemptions under 5 U.S.C. 552a(k)(5). Pursuant to the 
provisions of 5 U.S.C. 552a(k)(5), the Commissioner, United States 
Customs Service, hereby exempts the Internal Security Records System 
from the provisions of 5 U.S.C. 552a (c)(3), (d) (1), (2), (3) and (4), 
(e) (1) and (4) (G), (H) and (I) and (f). The records maintained in the 
exempt system of records are of the type described in 5 U.S.C. 
552a(k)(5): ``investigatory material compiled solely for the purpose of 
determining suitability, eligibility, or qualifications for Federal 
civilian employment, military service, Federal contracts, or access to 
classified information, but only to the extent that disclosure of such 
material would reveal the identity of a source who furnished information 
to the Government under an express promise that the identity of the 
source would be held in confidence, or, prior to the effective date of 
this section, under an implied promise that the identity of the source 
would be held in confidence.''

Thus to the extent that the records in this system can be disclosed 
without revealing the identity of a confidential source, they are not 
within the scope of this exemption and are subject to all the 
requirements of 5 U.S.C. 552a, except where those records contain other 
information which is exempt under the

[[Page 74]]

provisions of 5 U.S.C. 552a(k)(2) for the reasons stated under paragraph 
b. above.

The sections of 5 U.S.C. 552a from which this system of records is 
exempt include in general those providing for individuals' access to or 
amendment of records. When such access or amendment would cause the 
identity of a confidential source to be revealed, it would impair the 
future ability of the Customs Service to compile investigatory material 
for the purpose of determining suitability, eligibility, or 
qualifications for Federal civilian employment, Federal contracts, or 
access to classified information.

In addition, the systems shall be exempt from 5 U.S.C. 552a(e)(1) which 
requires that an agency maintain in its records only such information 
about an individual as is relevant and necessary to accomplish a purpose 
of the agency required to be accomplished by statute or executive order. 
The Customs Service believes that to fulfill the requirements of 5 
U.S.C. 552a(e)(1) would unduly restrict the agency in its information 
gathering inasmuch as it is often not until well after the investigation 
that it is possible to determine the relevance and necessity of 
particular information.

If any investigations within the scope of 5 U.S.C. 552a(k)(5) become 
involved with civil or criminal matters, exemptions from 5 U.S.C. 552a 
could also be asserted under 5 U.S.C. 552a (k)(2) or (j)(2).

                      United States Secret Service

Notice of rules exempting certain systems from requirements of the 
    Privacy Act

    (a) In general. The Director of the U.S. Secret Service hereby 
issues rules exempting the Criminal Investigation Information System of 
records, the Non-Criminal Investigation Information System of records, 
and the Protection Information System of records from the provisions of 
certain subsections of 5 U.S.C. 552a, the Privacy Act of 1974. The 
purpose of the exemptions is to maintain the confidentiality of 
information compiled for the purpose of criminal, non-criminal, and 
protective investigations.
    (b) Authority. These rules are promulgated pursuant to the authority 
vested in the Secretary of the Treasury by 5 U.S.C. 552a (j) and (k) and 
pursuant to the authority vested in the Director, U.S. Secret Service by 
paragraph 123(c) of subpart C of part 1 of subtitle A of title 31 of the 
Code of Federal Regulations.
    (c) Exempted Systems.

    I. U.S. Secret Service Criminal Investigation Information System

The Criminal Investigation Information System is further described in 
``Notices of Records Systems'' published by the General Services 
Administration.
    (1) Provisions from which exempted. The Criminal Investigation 
Information System maintained by the Secret Service contains records 
described in 5 U.S.C. 552a(j) and (k), the Privacy Act of 1974. 
Exemptions are claimed for such described records only where appropriate 
from the following provisions of the Privacy Act of 1974 subsections (c) 
(3) and (4); (d) (1), (2), (3) and (4); (e) (1), (2), and (3); (e) (4) 
(G), (H) and (I); (e) (5) and (8); (f) and (g) of 5 U.S.C. 552a.
    (2) Reasons for claimed exemptions. a. 5 U.S.C. 552a(c)(3): This 
provision of the Privacy Act provides for the release of the disclosure 
accounting required by 5 U.S.C. 552a(c) (1) and (2) to the individual 
named in the record at his request. The reasons why the Criminal 
Investigation Information System is exempted from the foregoing 
provision are as follows:
    (i) The release of accounting disclosures would put the subject of a 
criminal investigation on notice of the existence of an investigation 
and that he is the subject of that investigation;
    (ii) It would provide the subject of a criminal investigation with 
an accurate accounting of the date, nature, and purpose of each 
disclosure and the name and address of the person or agency to whom the 
disclosure is made. Obviously, the release of such information to the 
subject of a criminal investigation would provide him with significant 
information concerning the nature of the investigation and could result 
in impeding or compromising

[[Page 75]]

the efforts of law enforcement personnel to detect and arrest persons 
suspected of criminal activity;
    (iii) Disclosure to the individual of the disclosure accounting 
after the investigation is closed would alert the individual as to which 
agencies were investigating him and would put him on notice concerning 
the scope of his suspected criminal activities and could aid him in 
avoiding detection and apprehension.
    b. 5 U.S.C. 552a (c)(4); (d); (e)(4) (G) and (H); (f) and (g): The 
foregoing provisions of the Privacy Act relate to an individual's right 
to notification of the existence of records pertaining to him and access 
to such records; the agency procedures relating to notification, access 
and contest of the information contained in such records; and the civil 
remedies available to the individual in the event of adverse 
determinations by an agency concerning access to or amendment of 
information contained in record systems. The reasons why the Criminal 
Investigation Information System of records is exempted from the 
foregoing provisions are as follows:
    (i) To notify an individual at his request of the existence of 
records pertaining to him in the Criminal Investigation Information 
System would inform the individual of the existence of an investigation 
and that he is the subject of that investigation. This would enable the 
individual to avoid detection and would further enable him to inform co-
conspirators of the fact that an investigation is being conducted;
    (ii) To permit access to the records contained in the Criminal 
Investigation Information System would not only inform an individual 
that he is or was the subject of a criminal investigation, but would 
also provide him with significant information concerning the nature of 
the investigation which might enable him to avoid detection or 
apprehension;
    (iii) To grant access to an on-going or closed criminal 
investigative file could interfere with Secret Service investigative and 
enforcement proceedings, deprive co-defendants of a right to a fair 
trial or an impartial adjudication, constitute an unwarranted invasion 
of the personal privacy of others, disclose the identity of confidential 
sources and reveal confidential information supplied by such sources, 
and disclose investigative techniques and procedures, or endanger the 
life or physical safety of law enforcement personnel, informants, 
witnesses, and other persons supplying information to investigators.
    c. 5 U.S.C. 552a(e)(4)(I). This provision of the Privacy Act 
requires the publication of the categories of sources of records, in 
each system of records. The reasons why the Criminal Investigation 
Information System of records is exempted from the foregoing provision 
are as follows:
    (i) Revealing sources of information could disclose investigative 
techniques and procedures;
    (ii) Revealing sources of information could result in retaliation 
and threat of reprisal by the subject under investigation against such 
sources;
    (iii) Revealing sources of information could cause witnesses, 
informants and others who supply information to criminal investigators 
to refrain from giving such information because of fear of reprisal, or 
fear of breach of promises of anonymity and confidentiality;
    (iv) Revealing sources of information could result in the refusal of 
some sources to give full and complete information or to be candid with 
investigators because of the knowledge that the identity of such sources 
may be disclosed.
    d. 5 U.S.C. 552a(e)(1): This provision of the Privacy Act requires 
each agency to maintain in its records only such information about an 
individual as is relevant and necessary to accomplish a purpose of the 
agency. The reasons why the Criminal Investigation Information System of 
records is exempted from the foregoing provisions are as follows:
    (i) In a criminal investigation it is difficult to accurately 
determine the relevancy and necessity of information during the process 
of information gathering. Only after the information is evaluated can 
the relevancy and necessity of such information be ascertained;
    (ii) In a criminal investigation, the Secret Service often obtains 
information concerning the violations of laws other than those within 
the scope of its criminal investigative jurisdiction. In

[[Page 76]]

the interest of effective law enforcement, the Secret Service should 
retain this information as it may aid in establishing patterns of 
criminal activity, and provide valuable leads for those law enforcement 
agencies charged with enforcing other segments of the criminal law;
    (iii) In interviewing persons, or obtaining other forms of evidence 
during a criminal investigation, information will be supplied to the 
investigator which relates to matters which are ancillary to the main 
purpose of the investigation but which may relate to matters under the 
investigative jurisdiction of another agency. Such information is not 
readily susceptible to segregation.
    e. 5 U.S.C. 552a(e)(2): This provision of the Privacy Act requires 
an agency to collect information to the greatest extent practicable 
directly from the subject individual when the information may result in 
adverse determinations about an individual's right, benefits and 
privileges under Federal programs. The reasons why the Criminal 
Investigation Information System is exempted from the foregoing 
provision are as follows:
    (i) In certain instances, the subject of a criminal investigation is 
not required to supply information to investigators as a matter of legal 
right. In those instances, information relating to a subject's criminal 
activities must be obtained from other sources;
    (ii) A requirement that information be collected from an individual 
who is the subject of a criminal investigation would put the individual 
on notice of the existence of the investigation and could enable him to 
avoid detection or apprehension;
    (iii) In a criminal investigation it is necessary to obtain evidence 
from a variety of sources other than the subject of the investigation in 
order to accumulate and verify the evidence necessary for the successful 
prosecution of persons suspected of violating the criminal laws.
    f. 5 U.S.C. 552a(e)(3): This provision of the Privacy Act requires 
an agency to inform each individual whom it asks to supply information 
of the authority which authorizes the solicitation of the information 
and whether disclosure of such information is mandatory or voluntary; 
the principal purposes for which the information is intended to be used; 
the routine uses which may be made of the information; and the effect on 
the individual of not providing the requested information. The reasons 
why the Criminal Investigation Information System is exempted from the 
foregoing provision are as follows:
    (i) Informing each individual who is asked to supply information in 
a criminal investigation of the information required under the foregoing 
provision could inform the individual of the existence of a confidential 
investigation; reveal the identity of confidential sources of 
information; and endanger the life or physical safety of confidential 
informants;
    (ii) Informing each individual who is asked to supply information in 
a criminal investigation of the information required under the foregoing 
provision could result in an unwarranted invasion of the privacy of 
individuals who may be the subject of a criminal investigation or who 
are suspected of engaging in criminal activity;
    (iii) Informing each individual who is asked to supply information 
in a criminal investigation of the information required under the 
foregoing provision would inhibit such individuals from supplying the 
requested information and thereby present a serious impediment to the 
successful investigation and prosecution of violations of the criminal 
law.
    g. 5 U.S.C. 552a(e)(5): This provision of the Privacy Act requires 
an agency to maintain all records which are used in making any 
determination about an individual with such accuracy, relevance, 
timeliness, and completeness as is reasonably necessary to assure 
fairness to the individual in the determination. The reasons why the 
Criminal Investigation Information System is exempted from the foregoing 
provisions are as follows:
    (i) In gathering information during the course of a criminal 
investigation it is usually not possible to determine in advance what 
information is accurate, relevant, timely, and complete. Seemingly 
nonrelevant or untimely information may acquire new significance as an 
investigation progresses;

[[Page 77]]

    (ii) The restrictions on the maintenance of the records contained in 
the foregoing provision could impede investigators and intelligence 
analysts in the exercise of their judgment and discretion in reporting 
on criminal investigations;
    (iii) Compliance with the records maintenance criteria listed in the 
foregoing provision could require the periodic up-dating of Secret 
Service criminal investigations to insure that the records maintained in 
the system remain timely and complete.
    h. 5 U.S.C. 552a(e)(8): This provision of the Privacy Act requires 
an agency to make reasonable efforts to serve notice to an individual 
when any record on such individual is made available to any person under 
compulsory legal process becomes a matter of public record. The reasons 
why the Criminal Investigation Information System is exempted from the 
foregoing provision are as follows:
    (i) The notice requirement of the foregoing provision could impede 
law enforcement by revealing investigative techniques and procedures;
    (ii) The notice requirement of the foregoing provision could reveal 
the existence of confidential investigations to individuals who are the 
subjects of such investigations.
    i. The foregoing exemptions are claimed for materials maintained in 
the Criminal Investigation Information System to the extent that such 
materials contain information and reports described in 5 U.S.C. 552a(j) 
(2). Further, records maintained in the Criminal Investigation 
Information System described in 5 U.S.C. 552a(k) are exempted from 
subsections (c)(3), (d) (1), (2), (3) and (4), (e)(1), (e)(4) (G), (H) 
and (I) and (f) of 5 U.S.C. 552a for the reasons previously stated.

  II. U.S. Secret Service Non-Criminal Investigation Information System

The Non-Criminal Investigation Information System is further described 
in ``Notices of Records Systems'' published by the General Services 
Administration.
    (1) Provisions from which exempted: The Non-Criminal Investigation 
Information System maintained by the Secret Service contains records 
similar to those described in 5 U.S.C. 552a(k), the Privacy Act of 1974. 
Exemptions are claimed for such described records where appropriate from 
the following provisions of the Privacy Act of 1974: subsections (c)(3), 
(d) (1), (2), (3) and (4), (e)(1), (e)(4) (G), (H) and (I) and (f) of 5 
U.S.C. 552a.
    (2) Reasons for claimed exemptions. a. 5 U.S.C. 552a(c)(3): This 
provision of the Privacy Act provides for the release of the disclosure 
accounting required by 5 U.S.C. 552a(c) (1) and (2) to the individual 
named in the record at his request. The reasons why the Non-Criminal 
Investigation Information System is exempted from the foregoing 
provision are as follows;
    (i) The release of accounting disclosures would put the subject of 
an investigation on notice of the existence of an investigation and that 
he is the subject of that investigation;
    (ii) It would provide the subject of an investigation with an 
accurate accounting of the date, nature, and purpose of each disclosure 
and the name and address of the person or agency to whom the disclosure 
is made. Obviously, the release of such information to the subject of an 
investigation would provide him with significant information concerning 
the nature of the investigation and could result in impeding or 
compromising the efforts of law enforcement personnel to obtain 
information essential to the successful conclusion of the investigation;
    (iii) Disclosure to the individual of the disclosure accounting 
after the investigation is closed would alert the individual as to which 
agencies were investigating him; put him on notice concerning the scope 
of his suspected activities and reveal investigatory techniques and the 
identity of confidential informants. It could result in an invasion of 
privacy of private citizens who provide information in connection with a 
particular investigation.
    b. 5 U.S.C. 552a; (d), (e)(4) (G), (H) and (f): The foregoing 
provisions of the Privacy Act relate to an individual's right to 
notification of the existence of records pertaining to him and access to 
such records and the agency procedures relating to notification, access 
and contest of the information contained in

[[Page 78]]

such records. The reasons why the Non-Criminal Investigation Information 
System of records is exempted from the foregoing provisions are as 
follows:
    (i) To notify an individual at his request of the existence of 
records pertaining to him in the Non-Criminal Investigation Information 
System would inform the individual of the existence of an investigation 
and that he is the subject of that investigation. This could enable the 
individual to secrete or destroy evidence essential to the successful 
completion of the investigation;
    (ii) To permit access to the records contained in the Non-Criminal 
Investigation System would not only inform an individual that he is or 
was the subject of an investigation, but would also provide him with 
significant information concerning the nature of the investigation which 
might enable him to avoid detection or apprehension;
    (iii) To grant access to an on-going or closed non-criminal 
investigative file would interfere with Secret Service investigative and 
enforcement proceedings; deprive other parties involved in the 
investigations of a right to a fair trial or an impartial adjudication; 
constitute an unwarranted invasion of the personal privacy of others; 
disclose the identity of confidential sources and reveal confidential 
information supplied by such sources; and disclose investigative 
techniques and procedures.
    c. 5 U.S.C. 552a 3 (e)(4)(I). This provision of the Privacy Act 
requires the publication of the categories of sources of records in each 
system of records. The reasons why the Non-Criminal Investigation 
Information System of records is exempted from the foregoing provision 
are as follows:
    (i) Revealing sources of information would disclose investigative 
techniques and procedures;
    (ii) Revealing sources of information would result in retaliation 
and threat of reprisal by the subject under investigation against such 
sources;
    (iii) Revealing sources of information could cause witnesses, 
informants and others who supply information to investigators to refrain 
from giving such information because of fear of reprisal, or fear of 
breach of promises of anonymity and confidentiality;
    (iv) Revealing sources of information could result in the refusal of 
some sources to give full and complete information or to be candid with 
investigators because of the knowledge that the identity of such sources 
may be disclosed.
    d. 5 U.S.C. 552a(e)(1): This provision of the Privacy Act requires 
each agency to maintain in its records only such information about an 
individual as is relevant and necessary to accomplish a purpose of the 
agency. The reasons why the Criminal Investigation Information System of 
records is exempted from the foregoing provision are as follows:
    (i) In a non-criminal investigation it is difficult to determine 
accurately the relevancy and necessity of information during the process 
of information gathering. It is only after the information is evaluated 
that the relevancy and necessity of such information can be ascertained;
    (ii) In a non-criminal investigative case, the Secret Service often 
obtains information concerning the violation of laws other than those 
within the scope of its jurisdiction. In the interest of effective law 
enforcement, it is desirable that the Secret Service retain this 
information since it can aid in establishing patterns of unlawful 
activity and provide valuable leads for those law enforcement agencies 
that are charged with enforcing other segments of the criminal, 
regulatory and civil laws;
    (iii) In interviewing persons, or obtaining other forms of evidence 
during an investigation, information will be supplied to the 
investigator which relates to matters which are ancillary to the main 
purpose of the investigation but which may relate to matters under the 
investigative jurisdiction of another agency. Such information is not 
readily susceptible to segregation.
    e. The foregoing exemptions are claimed for records maintained in 
the Non-Criminal Investigation Information System only to the extent 
that such records contain materials described in subsection (k) of 5 
U.S.C. 552a, the Privacy Act of 1974.

[[Page 79]]

         III. U.S. Secret Service Protection Information System

The Protection Information System is further described in ``Notices of 
Records Systems'' published by the General Services Administration.
    (1) Provisions from which exempted. The Protection Information 
System maintained by the Secret Service contains records similar to 
those described in 5 U.S.C. 552a (j) and (k), the Privacy Act of 1974. 
The Protection Information System contains material relating to criminal 
investigations concerned with the enforcement of criminal statutes 
involving the security of persons and property. Further, this system 
contains records described in 5 U.S.C. 552a(k) including, but not 
limited to, classified materials and investigatory material compiled for 
law enforcement purposes. There are maintained in the Protection 
Information System, in addition to the categories of records described 
above, records which are considered necessary to assuring the safety of 
individuals protected by the Secret Service Pursuant to the provisions 
of 18 U.S.C. 3056 and Pub. L. 90-331 (5 U.S.C. 522a(k)(3)). Exemptions 
are claimed for the above described records only where appropriate from 
the following provisions of the Privacy Act of 1974: subsections (c)(3) 
and (d) (1), (2), (3) and (4); (e) (1), (2) and (3); (e)(4) (G), (H) and 
(I); (e) (5) and (8); (f) and (g) of 5 U.S.C. 552a.
    (2) Reasons for claimed exemptions. a. 5 U.S.C. 552a(c)(3): This 
provision of the Privacy Act provides for the release of the disclosure 
accounting required by 5 U.S.C. 552a(c) (1) and (2) to the individual 
named in the record at his request. The reasons why the Protection 
Information System is exempted from the foregoing provision are as 
follows:
    (i) The release of accounting disclosures would put the subject of a 
protective intelligence file on notice of the existence of an 
investigation and that he is the subject of that investigation;
    (ii) It would provide the subject of a protective intelligence file 
with an accurate accounting of the date, nature, and purpose of each 
disclosure and the name and address of the person or agency to whom the 
disclosure is made. Obviously, the release of such information to the 
subject of a protective intelligence file would provide him with 
significant information concerning the nature of the investigation, and 
could result in impeding or compromising the efforts of Secret Service 
personnel to detect persons suspected of criminal activities or to 
collect information necessary for the proper evaluation of persons 
considered to be of protective interest;
    (iii) Disclosures of the disclosure accounting after the protective 
intelligence file is closed would alert the individual as to which 
agencies were investigating him and would put him on notice concerning 
the scope of the protective intelligence investigation and could aid him 
in avoiding detection.
    b. 5 U.S.C. 552a (c)(4); (d); (e)(4) (G) and (H); (f) and (g): The 
foregoing provisions of the Privacy Act relate to an individual's right 
to notification of the existence of records pertaining to him and access 
to such records; the agency procedures relating to notification; access 
and contest of the information contained in such records; and the civil 
remedies available to the individual in the event of adverse 
determinations by an agency concerning access to or amendment of 
information contained in record systems. The reasons why the Protection 
Information System of records is exempted from the foregoing provisions 
are as follows:
    (i) To notify an individual at his request of the existence of 
records pertaining to him in the Protection Information System would be 
injurious to the protective intelligence activities of the Secret 
Service if the existence of files on the subject were even acknowledged. 
Granting access to the criminal and the unstable person would 
necessarily lead to knowledge of the sources of Secret Service 
information and could endanger other enforcement and intelligence 
operations and confidential sources including co-workers, friends and 
relatives of the subjects of such records;
    (ii) Limitation on access to the materials contained in the 
Protection Information System is considered necessary to the 
preservation of the utility of intelligence files and in safeguarding

[[Page 80]]

those persons the Secret Service is authorized to protect. Without such 
denial of access the Protection Information System could adversely 
effect in the poor quality of information available; in compromised 
confidential sources; in the inability to keep track of persons of 
protective interest; and from interference with Secret Service 
protective intelligence activities by individuals gaining access to 
protective intelligence files. Many of the persons on whom records are 
maintained in the Protection Information System suffer from mental 
aberrations. Knowledge of their condition and progress comes from 
authorities, family members and witnesses. Many times this information 
comes to the Secret Service as a result of two party conversations where 
it would be impossible to hide the identity of informants. Sources of 
information must be developed, questions asked and answers recorded. 
Trust must be extended and guarantees of confidentiality and anonymity 
must be maintained. Allowing access of information of this kind to 
individuals who are the subjects of protective interest may well lead to 
violence directed against an informant by a mentally disturbed 
individual;
    (iii) Permitting access to protective intelligence files would 
reveal techniques and procedures, not only of Secret Service protective 
investigations but could reveal the criteria by which protective 
intelligence subjects are evaluated;
    (iv) To notify an individual at his request of the existence of 
records pertaining to him in the Protection Information System would 
inform the individual of the existence of an investigation and that he 
is the subject of protective interest. This would enable the individual 
to avoid detection and would further enable him to inform co-
conspirators of the fact that an investigation is being conducted;
    (v) To permit access to the records contained in the Protection 
Information System would not only inform an individual that he is or was 
the subject of protective interest, but would also provide him with 
significant information concerning the nature of any investigation 
concerning his activities;
    (vi) To grant access to current or closed protective intelligence 
files would interfere with Secret Service investigative and enforcement 
proceedings; deprive co-defendants of a right to a fair trial or an 
impartial adjudication; constitute an unwarranted invasion of the 
personal privacy of others; disclose the identity of confidential 
sources; reveal confidential information supplied by such sources; and 
disclose investigative techniques and procedures, and endanger the life 
or physical safety of law enforcement personnel, informants, witnesses, 
and other persons suppling information to investigators.
    c. 5 U.S.C. 552a(e)(4)(I). This provision of the Privacy Act 
requires the publication of the categories of sources of records in each 
system of records. The reasons why the Protection Information System of 
records is exempted from the foregoing provision are as follows:
    (i) Revealing sources of information would disclose investigative 
techniques and procedures;
    (ii) Revealing sources of information would result in retaliation 
and threat of reprisal by the subject of a protective intelligence file;
    (iii) Revealing sources of information would cause witnesses, 
informants and others who supply information to Secret Service 
investigators to refrain from giving such information because of fear of 
reprisal, or fear of breach of promises of anonymity and 
confidentiality;
    (iv) Revealing sources of information would result in the refusal of 
some sources to give full and complete information or to be candid with 
investigators because of the knowledge that the identity of such sources 
may be disclosed.
    d. 5 U.S.C. 552a(e)(1): This provision of the Privacy Act requires 
each agency to maintain in its records only such information about an 
individual as is relevant and necessary to accomplish a purpose of the 
agency. The reasons why the Protection Information System of records is 
exempted from the foregoing provisions are as follows:
    (i) In gathering protective intelligence information it is difficult 
to determine accurately the relevancy and

[[Page 81]]

necessity of information during the process of information gathering. It 
is only after the information is evaluated that the relevancy and 
necessity of such information can be ascertained;
    (ii) In carrying out protective intelligence responsibilities the 
Secret Service often obtains information concerning the violation of 
laws other than those within the scope of its protective intelligence 
jurisdiction. In the interest of effective law enforcement, it is 
desirable that the Secret Service retain this information since it can 
aid in establishing patterns of criminal activity and provide valuable 
leads for those law enforcement agencies that are charged with enforcing 
other segments of the criminal law;
    (iii) During protective intelligence investigations, information 
will be supplied to the investigator which relates to matters which are 
ancillary to the main purpose of the investigation but which may relate 
to matters under the investigative jurisdiction of another agency. Such 
information is not readily susceptible to segregation.
    e. 5 U.S.C. 552a(c)(2): This provision of the Privacy Act requires 
an agency to collect information to the greatest extent practicable 
directly from the subject individual when the information may result in 
adverse determinations about an individual's rights, benefits and 
privileges under Federal programs. The reasons why the Protection 
Information System is exempted from the foregoing provision are as 
follows:
    (i) In certain instances, where the protective intelligence subject 
is suspected of criminal activity, he is not required to supply 
information to investigators as a matter of legal right. In those 
instances, information relating to a subject's criminal activities must 
be obtained from other sources;
    (ii) A requirement that information be collected from an individual 
who is of protective interest would put the individual on notice of the 
existence of the intelligence investigation and such knowledge would 
enable him to avoid detection in the event that the individual attempted 
to physically harm persons protected by the Secret Service;
    (iii) In a protective intelligence investigation where the subject 
of the investigation is suspected of engaging in criminal activities it 
is necessary to obtain evidence from a variety of sources other than the 
subject of the investigation in order to accumulate and verify the 
evidence necessary for the successful prosecution of persons suspected 
of violating the criminal laws.
    f. 5 U.S.C. 552a(e)(3): This provision of the Privacy Act requires 
an agency to inform each individual whom it asks to supply information 
of the authority which authorizes the solicitation of the information 
and whether disclosure of such information is mandatory or voluntary; 
the principle purposes for which the information is intended to be used; 
the routine uses which may be made of the information; and the effect on 
the individual of not providing the requested information. The reasons 
why the Protection Information System is exempted from the foregoing 
provision are as follows:
    (i) Informing each individual who is asked to supply information in 
a protective intelligence investigation of the information required 
under the foregoing provision would inform the individual of the 
existence of a confidential investigation; reveal the identity of 
confidential sources of information; and endanger the life or physical 
safety of confidential informants;
    (ii) Informing each individual who is asked to supply information in 
a protective intelligence investigation of the information required 
under the foregoing provision would result in an unwarranted invasion of 
the privacy of individuals who may be the subject of a criminal 
investigation or who are suspected of engaging in criminal activity;
    (iii) Informing each individual who is asked to supply information 
in a protective intelligence investigation of the information required 
under the foregoing provision would inhibit such individuals from 
supplying the requested information and thereby present a serious 
impediment to the success of the Secret Service in carrying out its 
protective intelligence activities.
    g. 5 U.S.C. 552a(e)(5): This provision of the Privacy Act requires 
an agency to maintain all records which are used

[[Page 82]]

in making any determination about an individual with such accuracy, 
relevance, timeliness, and completeness as is reasonably necessary to 
assure fairness to the individual in the determination. The reasons why 
the Protection Information System is exempted from the foregoing 
provisions are as follows:
    (i) In gathering information during the course of a protective 
intelligence investigation it is usually not possible to determine in 
advance what information is accurate, relevant, timely, and complete. 
Seemingly nonrelevant or untimely information may acquire new 
significance as an investigation progresses;
    (ii) The restrictions on the maintenance of the records contained in 
the foregoing provision would impede investigators and intelligence 
analysts in the exercise of their judgment and discretion in reporting 
on protective intelligence subjects;
    (iii) Compliance with the records maintenance criteria listed in the 
foregoing provision would require the periodic up-dating of Secret 
Service protective intelligence files to insure that the records 
maintained in the system remain timely and complete.
    h. 5 U.S.C. 552a(e)(8): This provision of the Privacy Act requires 
an agency to make reasonable efforts to serve notice to an individual 
when any record on such individual is made available to any person under 
compulsory legal process becomes a matter of public record. The reasons 
why the Protection Information System is exempted from the foregoing 
provision are as follows:
    (i) The notice requirement of the foregoing provision could impede 
Secret Service protective efforts by revealing techniques and 
procedures;
    (ii) The notice requirements of the foregoing provision could reveal 
the existence of confidential investigations to individuals who are the 
subjects of such investigations.
    i. The foregoing exemptions are claimed for materials maintained in 
the Protection Information System to the extent that such materials 
contain information and reports described in 5 U.S.C. 552a(j)(2). 
Further, records maintained in the Protection Information System 
described in 5 U.S.C. 552a(k) are to be exempted from subsections 
(c)(3), (d) (1), (2), (3) and (4); (e)(1), (e)(4) (G), (H) and (I) and 
(f) of 5 U.S.C. 552a for the reasons previously stated.

                 Bureau of Alcohol, Tobacco and Firearms

 notice of systems exempt from certain provisions of the privacy act of 
                                  1974

    In accordance with 5 U.S.C. 552a (j) and (k), general notice is 
hereby given of rulemaking under the Privacy Act of 1974 by the 
Director, Bureau of Alcohol, Tobacco and Firearms. The Director, Bureau 
of Alcohol, Tobacco and Firearms, exempts the systems of records 
identified in paragraphs (a), (b) and (c) of this section from certain 
provisions of the Privacy Act of 1974 as set forth in such paragraphs.

                               exemptions

    (a) General exemptions. Under the provisions of 5 U.S.C. 552a(j), 
the Director, Bureau of Alcohol, Tobacco and Firearms, hereby determines 
that certain provisions of the Privacy Act of 1974 shall not apply to 
the Treasury--ATF Criminal Investigation Report System.
    (1) The Privacy Act of 1974 creates several methods by which 
individuals who are of record in this system of records may discover 
information collected about their criminal activities. These methods are 
as follows: subsections (e)(4)(G) and (f)(1) allow individuals to 
ascertain whether their criminal activities have been recorded; 
subsections (d)(1), (e)(4)(H), and (f) (2), (3) and (5) establish the 
ability of individuals to gain access into the investigatory files 
maintained on their criminal activities; subsections (d) (2), (3) and 
(4), (e)(4)(H), and (f)(4) presuppose access and further enable 
individuals to contest the contents of their criminal files; subsection 
(c)(3) allows individuals to discover if other law enforcement agencies 
are investigating their criminal activities and subsection (e)(4)(I) 
discloses the categories of sources of records in the system. Since 
these subsections are variations upon the criminal subjects' ability to 
ascertain whether a Federal law enforcement agency has uncovered their 
criminal misdeeds, these subsections

[[Page 83]]

have been grouped together for purposes of this notice.
    (A) With respect to subsections (e)(4)(G) and (f)(1), the Bureau of 
Alcohol, Tobacco and Firearms believes that imposition of these 
requirements would identify to individuals the fact that they are of 
record, and in so doing, compromise the ability of ATF to successfully 
complete an investigation into violations of law. Where individuals have 
the ability to discover the location and specific character of their 
investigative records in this system, they will be able to determine the 
nature of the investigation, the type of surveillance utilized and the 
precise stage of the investigation into their criminal activities. When 
individuals can determine that the investigation into their criminal 
activities has been closed, they are placed on notice that they may 
safely resume their illegal conduct. For these reasons, ATF seeks 
exemption of this system from subsections (e)(4)(G) and (f)(1).
    (B) With respect to subsections (d)(1), (e)(4)(H) and (f) (2), (3) 
and (5), the Bureau of Alcohol, Tobacco and Firearms believes that 
access into criminal investigative files poses present and future 
dangers on the ability of this agency to effectively enforce the 
criminal laws committed to its administration. Where individuals may 
break into an ongoing criminal investigative file they discover the 
collection of facts which will form the basis of their arrests. 
Knowledge of these facts enables them to destroy valuable contraband or 
other evidence of their activities prior to lawful seizure and thereby 
prevent enforcement proceedings. The ongoing investigative file may 
reveal that reasonable cause exists to believe that a crime is about to 
be committed. Disclosure of these facts enable individuals with criminal 
intent to either postpone the commission of their criminal acts or 
relocate the scene of the crime to an alternatively acceptable location 
where Federal agents will not be anticipated. After a criminal 
investigation has been closed, information in the file nevertheless 
reveals to the investigated subjects the techniques and procedures 
utilized by a law enforcement agency. Knowledge of these investigative 
techniques and procedures by individuals and groups devoted to crime 
enables them to structure their future operations in such a way as to 
place these activities beyond discovery until after the crime has been 
committed. Thus, the ability of Federal agents to prevent crime by 
apprehension of the criminals at the precise moment of commission of the 
criminal act is seriously jeopardized.

Disclosure of investigative techniques and procedures could further 
render the commission of the criminal act itself not susceptible to 
reconstruction and tracing to its originator. Armed with a knowledge of 
forensic science and the applied technology of criminal investigation 
contained in their own files, individuals and groups of individuals 
devoted to crime have the necessary information to develop counter-
techniques which may effectively neutralize established investigative 
tools and procedures. Additionally, a closed criminal file reveals the 
identities of informers and undercover agents who have possibly risked 
their lives and the lives of their families by contributing information 
concerning the criminal activities of individuals and groups. 
Oftentimes, friends, family, neighbors and business associates of the 
subject under investigation, secure in the assured anonymity of a 
Federal criminal investigation, are not afraid to furnish valuable 
information relating to the criminal activities of the subjects of 
investigation. Where criminal subjects have access to the confidential 
information in their criminal files (with or without the identities of 
the sources) they can determine from the nature of the information and 
by process of elimination the identity of those individuals against whom 
to retaliate. This legitimate fear of reprisal exists in the minds of 
neighbors, relatives, and co-workers, especially with regard to 
individuals who are violence-prone or emotionally unstable. As a direct 
result of this fear of discovery through access to the investigative 
file, sources close to the criminal subject would decline to be 
interviewed or otherwise refrain from contact with the Bureau. This 
absence of information would render the Bureau unable to comply 
effectively with the mandates of the statutes committed to its 
administration. For these

[[Page 84]]

reasons, ATF seeks exemption of this system from subsections (d)(1), 
(e)(4)(H) and (f) (2), (3) and (5).
    (C) With respect to subsections (d) (2), (3) and (4), (e)(4)(H), and 
(f)(4), which presuppose access and provide for contest of the content 
of records contained in this system, the Bureau of Alcohol, Tobacco and 
Firearms believes that the reasons set forth in subparagraph (B) of 
paragraph (1) of this subsection are equally applicable to this 
subparagraph, and are hereby incorporated by reference. For these 
reasons, ATF seeks exemption of this system from subsections (d) (2), 
(3) and (4), (e)(4)(H) and (f)(4).
    (D) With respect to subsection (c)(3) which provides for making the 
accounting of disclosures available to the requester, the Bureau of 
Alcohol, Tobacco and Firearms believes that access to this accounting by 
a subject under investigation would impair the ability of other law 
enforcement agencies to utilize information developed by ATF for their 
investigations into violations of criminal laws not enforced by ATF. 
Where the interstate criminal activities of individuals or groups span 
the jurisdictions of several law enforcement agencies, information will 
be shared by these agencies in their attempts to bring these violators 
to justice. Disclosure of the accounting will alert such individuals to 
which agencies are conducting investigations, the geographic locations 
of such investigations, the nature and purpose of the investigations, 
and the date during which the investigation received information 
maintained by ATF. Supplied with this information, individuals or groups 
may ascertain which of their criminal activities have been discovered 
and the law enforcement agencies which are in current pursuit. For these 
reasons, ATF seeks exemption of this system from subsection (c)(3).
    (E) With respect to subsection (e)(4)(I), which requires publication 
of the categories of sources for a record system, the Bureau of Alcohol, 
Tobacco and Firearms believes that imposition of subsection (e)(4)(I) 
upon this system would reveal investigative techniques and procedures. 
For this reason, ATF seeks exemption of this system from subsection 
(e)(4)(I).
    (2) The Privacy Act of 1974 provides, at subsection (e)(1), that an 
agency may maintain only such information about an individual as is 
relevant and necessary to accomplish a purpose of the agency required to 
be accomplished by a statute or executive order of the President. The 
term ``maintain'' is defined in the Privacy Act to include the initial 
collection of information. The Bureau of Alcohol, Tobacco and Firearms 
believes that exemption of this system from subsection (e)(1) is 
appropriate because not all violations uncovered in an investigation are 
capable of enforcement by ATF. Where individuals or groups are engaged 
in a multiplicity of criminal violations, this evidence should be 
recorded by ATF and transferred to the appropriate law enforcement 
agencies. This Bureau should not and cannot legally ignore violations of 
law uncovered in a lawful ATF investigation merely because ATF has no 
authority to bring the criminal to justice for these non-ATF violations. 
Where other agencies uncover evidence of ATF violations, this 
information must be susceptible to collection and preservation by that 
agency for subsequent use by ATF. Where an investigation by ATF uncovers 
only ATF violations, information may initially appear irrelevant and 
unnecessary when collected. However, a later stage of the investigation 
may uncover additional facts which when placed together with the 
initially collected irrelevant information, form the basis for 
reasonable cause to believe that additional suspects are involved or 
additional crimes have been or are being committed. Until all facts have 
been gathered and evaluated at the conclusion of the investigation it 
may not be possible to determine relevancy and necessity. For these 
reasons, ATF seeks exemption of this system from subsection (e)(1).
    (3) The Privacy Act of 1974 provides at subsection (e)(2) that an 
agency must collect information to the greatest extent practicable 
directly from the subject individual. The Bureau of Alcohol, Tobacco and 
Firearms believes that this system should be exempted from subsection 
(e)(2) because most information gathered upon a subject under 
investigation is obtained

[[Page 85]]

from third parties and witnesses. There is a minimal degree of 
practicability in contacting a criminal subject for purposes of seeking 
information as to his criminal activities. Such contact alerts the 
individual that he is under investigation and affords him opportunity to 
conceal his criminal activities or otherwise avoid detection or 
apprehension. In certain instances, the subject of a criminal 
investigation is not required to supply information to investigators as 
a matter of legal right. Law violators seldom give self-incriminatory 
information about their involvement in criminal activities. In those 
instances, information relating to the subject's criminal activities 
must be obtained from other sources. For these reasons, ATF seeks 
exemption of this system from subsection (e)(2).
    (4) The Privacy Act of 1974 provides at subsection (e)(3) that each 
individual must be informed of the authority, principle purposes, and 
routine uses and effects on the individual when requested to provide 
information. The Bureau of Alcohol, Tobacco and Firearms believes that 
this system should be exempted from subsection (e)(3). When information 
is obtained by undercover officers, conformity to (e)(3) discloses their 
identity as agents of a law enforcement authority and thereby impairs 
their physical safety as well as the successful conclusion of the 
investigation. When presented with a written statement complying with 
(e)(3) by special agents acting in undercover capacity, the individual 
may not thereafter be completely open with such agents. For these 
reasons, ATF seeks exemption of this system from subsection (e)(3).
    (5) The Privacy Act of 1974 provides at subsection (e)(5) that an 
agency maintain all records which are used in making any determination 
about an individual with such accuracy, relevance, timeliness, and 
completeness as is reasonably necessary to assure fairness to the 
individual in the determination. Since the law defines ``maintain'' to 
include collection of information, the Bureau of Alcohol, Tobacco and 
Firearms believes that this system should be exempt from subsection 
(e)(5) because it would prohibit the initial collection of any data not 
shown to be accurate, relevant, timely or complete at the moment of its 
collection. In gathering information during the course of a criminal 
investigation it is not feasible or possible to determine completeness, 
accuracy, timeliness or relevancy prior to collection of the 
information. Facts are first gathered then placed into a cohesive order 
which objectively proves or disproves criminal behavior on the part of a 
suspect. Seemingly irrelevant, untimely and incomplete information when 
gathered may acquire new significance as an investigation progresses. 
The restrictions of (e)(5) could impede special agents in the 
preparation of a complete investigative report. For these reasons, ATF 
seeks exemption of this system from subsection (e)(5).
    (6) The Privacy Act of 1974 provides, at subsection (e)(8), that an 
agency must make reasonable efforts to serve notice on an individual 
when his records are made available pursuant to compulsory legal 
process, when such process becomes a matter of public record. Such a 
requirement would impose unnecessary and unusual administrative demands 
on the Bureau of Alcohol, Tobacco and Firearms by requiring a record 
system to follow up on legal process emanating from court proceedings to 
which ATF is not a party. The Bureau of Alcohol, Tobacco and Firearms 
believes the duty of serving notice in such a case properly rests with 
the moving party who seeks disclosure by utilization of the court's 
compulsory legal process. Further, in most cases where an individual's 
criminal records have been disclosed pursuant to compulsory legal 
process, the individual who is the subject of the records will be a 
party to the proceedings and will have actual notice of the disclosure. 
For these reasons, ATF seeks exemption of this system from subsection 
(e)(8).
    (7) The Privacy Act of 1974 provides, at subsection (g), civil 
remedies for agency failure to grant access, agency failure to amend 
records, agency failure to maintain accurate, relevant, timely and 
complete records and agency failure to comply with provisions of the 
Privacy Act which have an adverse effect on an individual. The Bureau of

[[Page 86]]

Alcohol, Tobacco and Firearms believes that this system should be 
exempted from subsection (g) because the civil remedies provided in this 
subsection apply to provisions in the Privacy Act which have been 
exempted from application to this system by virtue of this notice. Since 
these provisions are not intended to apply to this system, there should 
be no corresponding civil penalty for failure to comply with the 
requirements of these sections due to exercise of the exemption 
authority. ATF believes that application of this subsection to this 
system of records would impair ATF's ability to conduct investigations 
into the criminal behavior of suspects because every step in the 
investigation process in which information is compiled for prosecution 
purposes would be susceptible to civil action under this subsection. For 
these reasons, ATF seeks exemption of this system from subsection (g).
    (b) Specific exemptions under section 552a(k)(2). Under the 
provisions of 5 U.S.C. 552a(k)(2), the Director, Bureau of Alcohol, 
Tobacco and Firearms, hereby determines that certain provisions of the 
Privacy Act of 1974 shall not apply to the Treasury--ATF--Regulatory 
Enforcement Record System, the Treasury--ATF--Technical and Scientific 
Services Record System, and that portion of the Treasury--ATF--Internal 
Security Record System relating to ``conduct of employees'' and 
``integrity of employees'' records.
    (1) The Privacy Act of 1974 creates several methods by which 
individuals may discover records containing information on such 
individuals and consisting of investigatory material compiled for law 
enforcement purposes. These methods are as follows: subsection (c)(3) 
allows individuals to discover if other agencies are investigating such 
individuals; subsections (d)(1), (e)(4)(H), and (f) (2), (3) and (5) 
establish the ability of individuals to gain access to investigatory 
material compiled on such individuals; subsections (d) (2), (3) and (4), 
(e)(4)(H) and (f)(4) presuppose access and enable individuals to contest 
the contents of investigatory material compiled on these individuals; 
and subsections (e)(4)(G) and (f)(1) allow individuals to determine 
whether or not they are under investigation. Since these subsections are 
variations upon the individuals' ability to ascertain whether their 
civil or criminal misdeeds have been discovered, these subsections have 
been grouped together for purposes of this notice.
    (A) The Bureau of Alcohol, Tobacco and Firearms believes that 
imposition of the requirements of subsection (c) (3), requiring 
accounting of disclosures be made available to individuals, would impair 
the ability of ATF and other investigative entities to conduct 
investigations of alleged or suspected violations of civil or criminal 
laws. Making the accounting of disclosures available identifies to 
individuals which investigative entities are investigating the 
individuals, the nature of the violations of which they are suspected, 
and the purpose for the exchange of information. Supplied with this 
information, the individuals concerned would be able to alter their 
ongoing and future illegal activities, conceal or destroy evidentiary 
materials and documents, and otherwise seriously impair the successful 
completion of investigations. Further, where individuals learn the 
geographic location and identity of the investigative entities which are 
interested in them, such individuals are able to move the site of their 
illegal activities or become secure in the knowledge that their illegal 
activities have not been detected in particular geographic locations. 
For these reasons, ATF seeks an exemption from the requirements of 
subsection (c)(3).
    (B) With respect to subsections (d) (1), (e)(4)(H), and (f) (2), (3) 
and (5), the Bureau of Alcohol, Tobacco and Firearms believes that 
access into investigatory material would prevent the successful 
completion of ongoing investigations. Individuals who gain access to 
investigatory material compiled on them discover the nature and extent 
of the violations of civil or criminal laws which they are suspected or 
alleged to have committed. By gaining access, such individuals also 
learn the facts developed during an investigation. Knowledge of the 
facts and the nature and extent of the suspected or alleged violations 
enables these individuals to destroy materials or documents which

[[Page 87]]

would have been used as evidence against them. In addition, knowledge of 
the facts and the suspected violations gives individuals, who are 
committing ongoing violations or who are about to commit violations of 
civil or criminal laws, the opportunity to temporarily postpone the 
commission of the violations or to effectively disguise the commission 
of these violations. Access to material compiled on investigated 
individuals reveals investigative techniques and the procedures followed 
in conducting investigations. Disclosure of these techniques and 
procedures enables individuals who intend to violate civil or criminal 
laws to structure their future illegal activities in such a way that 
they escape detection. Investigative material may contain the identity 
of confidential sources of information. Individuals who gain access to 
investigatory material compiled on them learn the identity of these 
confidential sources. Even where the name of the source is not revealed, 
investigated individuals may learn the identity of confidential sources 
by the process of elimination or by the very nature of the information 
contained in the files. Where the identity of confidential sources has 
been revealed, they may be subject to various forms of reprisal. If 
confidential sources of information are subjected to reprisals or the 
fear of reprisals, they would become reluctant to provide information 
necessary to identify or prove the guilt of individuals who violate 
civil or criminal laws. Without the information that is often supplied 
by confidential sources, the ability of investigative entities would be 
seriously impaired. For the reasons stated in this paragraph, ATF seeks 
exemption from the requirements of subsections (d)(1), (e)(4)(H), and 
(f) (2), (3) and (5).
    (C) With respect to subsections (d) (2), (3) and (4), (e) (4) (H), 
and (f) (4), the Bureau of Alcohol, Tobacco and Firearms believes that 
the imposition of these requirements, which presuppose access and 
provide for amending records, would impair ATF's ability to conduct 
investigations for the same reasons stated in the preceding paragraph 
(b)(1)(B), and are incorporated by reference herein. Therefore, ATF 
seeks exemption from the requirements of subsections (d) (2), (3) and 
(4), (e)(4)(H), and (f)(4).
    (D) With respect to subsections (e) (4)(G) and (f)(1), the Bureau of 
Alcohol, Tobacco and Firearms believes that informing individuals that 
they are of record would impair the ability of ATF to successfully 
complete the investigations of suspected or alleged violators of civil 
or criminal laws. Individuals, who are informed that they have been 
identified as suspected violators of civil or criminal laws, are given 
the opportunity to destroy evidence or other material needed to prove 
the alleged violations. Such individuals would also be able to impair 
investigations by temporarily suspending ongoing illegal activities or 
by restructuring intended illegal activities. Informing individuals that 
they are of record in a particular system of records enables such 
individuals to learn the nature of the investigation, the character of 
the investigatory material and the specific civil or criminal laws they 
are suspected of violating. For these reasons, ATF seeks exemption from 
the requirements of subsections (e)(4)(G) and (f)(1).
    (2) Subsection (e)(1) of the Privacy Act of 1974 requires that ATF 
maintain in its records only information that is relevant and necessary 
to accomplish a purpose of ATF required to be accomplished by statute or 
by executive order of the President. The Bureau of Alcohol, Tobacco and 
Firearms believes that imposition of such requirement would seriously 
impair the ability of ATF and other investigative entities to 
effectively investigate suspected or alleged violations of civil or 
criminal laws. Where individuals are engaged in a broad variety of 
violations, if ATF were only to collect information necessary and 
relevant to laws under ATF's jurisdiction, ATF would be unable to 
perform one of its functions, i.e., working with other governmental 
agencies which have similar jurisdictional concerns. Additionally, it is 
often impossible to determine whether or not information is relevant and 
necessary until the investigation is completed. When initially 
collected, information may appear irrelevant or immaterial. However, 
when this information is placed together with additional data gathered 
at a later stage of

[[Page 88]]

the investigation, the initially collected irrelevant information may 
form the basis for reasonable cause to believe additional violations of 
law are present or additional suspects are involved. Until all facts 
have been gathered and evaluated it may not be possible to determine 
relevancy and materiality. For these reasons, ATF seeks an exemption 
from the requirement of subsection (e)(1).
    (c) Specific exemptions under section 552a (k)(5). The Director, 
Bureau of Alcohol, Tobacco and Firearms exempts under section (k) of the 
Privacy Act of 1974, 5 U.S.C. 552a, that portion of the Treasury--ATF--
Internal Security Record System relating to ``security clearances for 
employees'' records, and the Treasury--ATF--Personnel Record System from 
sections (c)(3), (d) (1) through (4), (e)(1), (e)(4)(G) through 
(e)(4)(I), and (f) of the Act. The records maintained in the exempt 
systems of records are of the type described in section (k)(5) of the 
Act: Investigatory material compiled solely for the purpose of 
determining suitability, eligibility, or qualifications for Federal 
civilian employment, military service, Federal contracts, or access to 
classified information, but only to the extent that the disclosure of 
such material would reveal the identity of a source who furnished 
information to the Government under an express promise that the identity 
of the source would be held in confidence, or, prior to the effective 
date of this section, under an implied promise that the identity of the 
source would be held in confidence.
    Thus to the extent that the records in this system can be disclosed 
without revealing the identity of a confidential source, they are not 
within the scope of this proposed exemption and are subject to all the 
requirements of the Privacy Act.
    The sections of the Act from which this system of records are exempt 
are in general those providing for individual access to records. When 
such access would cause the identity of a confidential source to be 
revealed, it would impair the future ability of the Treasury Department 
to compile investigatory material for the purpose of determining 
suitability, eligibility, or qualifications for Federal civilian 
employment, Federal contracts, or access to classified information.
    In addition, the systems are exempt from section (e)(1) which 
requires that the agency maintain in its records only such information 
about an individual as is relevant and necessary to accomplish a 
statutory or executively ordered purpose. The Director finds that to 
fulfill the requirements of section (e) (1) would unduly restrict the 
agency in its information gathering inasmuch as it is often not until 
well after the investigation that it is possible to determine the 
relevance and necessity of particular information.
    If any investigations within the scope of section (k)(5) become 
involved with civil or criminal matters, exemptions from the Act could 
also be asserted under sections (k)(2) or (j)(2).
    (d) Application of exemptions to records exempt in whole or in part. 
(1) When an individual requests records about himself which have been 
exempted from individual access pursuant to 5 U.S.C. 552a(j) or which 
have been compiled in reasonable anticipation of a civil action or 
proceeding in either a court or before an administrative tribunal, the 
Bureau of Alcohol, Tobacco and Firearms will neither confirm nor deny 
the existence of the record but shall advise the individual only that no 
record available to him pursuant to the Privacy Act of 1974 has been 
identified.
    (2) When there is a request for information which has been 
classified by ATF pursuant to Executive Order 11652 and Treasury Order 
160, ATF will review the information to determine whether it continues 
to warrant classification under the criteria of sections 1 and 5 (B), 
(C), (D), and (E) of the Executive Order. Information which no longer 
warrants classification under these criteria shall be declassified. 
After declassification, the information shall be made available to the 
individual, unless an exemption is claimed. If the information continues 
to warrant classification, the provisions of EO 11652 shall apply.
    (3) Requests for information which have been exempted from 
disclosure pursuant to 5 U.S.C. 552a(k)(2) shall be responded to in the 
manner provided in paragraph (d)(1) of this section unless a review of 
the information indicates

[[Page 89]]

that the information has been used to deny the individual any right, 
privilege, or benefit for which he is eligible or to which he would 
otherwise be entitled under federal law. In that event, the individual 
shall be advised of the existence of the information and shall be 
provided the information except to the extent it would reveal the 
identity of a source who furnished information to the Government under 
an express promise that the identity of the source would be held in 
confidence, or, prior to September 27, 1975, under an implied promise 
that the identity of the source would be held in confidence.
    (4) Information compiled as part of an employee background 
investigation which has been exempted pursuant to 5 U.S.C. 552a(k)(5) 
shall be made available to an individual upon request except to the 
extent it would reveal the identity of a source who furnished 
information to the Government under an express promise that the identity 
of the source would be held in confidence, or, prior to September 27, 
1975, under an implied promise that the identity of the source would be 
held in confidence.
    (5) Even though the exemptions described in paragraphs (a), (b) and 
(c) of this section may be fully applicable, the Bureau may, if not 
precluded by law, elect under the circumstances of a particular case not 
to apply the exemption; or to exempt only a part. The fact that the 
exemption is not applied by the Bureau in a particular case has no 
precedential significance as to the application of the exemption to such 
matter in other cases. It is merely an indication that in the particular 
case involved, the Bureau finds no compelling necessity for applying the 
exemption to such matter. Where the Bureau has elected not to apply an 
exemption, in whole or in part, Appendix E of 31 CFR part 1, subpart C, 
relating to ATF's notice, access and amendment procedures shall apply to 
the records requested only to the extent that the exemption was not 
asserted.

      Bureau of Engraving and Printing, Department of the Treasury

   Notice of rules exempting certain systems from requirements of the 
                               Privacy Act

    (a) In general. The Director of the Bureau of Engraving and Printing 
exempts the Office of Security Investigative Files from the provisions 
of certain subsections of 5 U.S.C. 552a, the Privacy Act of 1974. The 
purpose of the exemptions is to maintain the confidentiality of 
information compiled for the purpose of criminal, non-criminal, employee 
suitability and security investigations.
    (b) Authority. These rules are promulgated pursuant to the authority 
vested in the Secretary of the Treasury by 5 U.S.C. 552a(k) and pursuant 
to the authority vested in the Director, Bureau of Engraving and 
Printing.
    (c) Exempted system. Bureau of Engraving and Printing, Office of 
Security, Investigative Files.
    (1) Provisions from which exempted. The Investigative Files 
maintained by the Office of Security contain records described in 5 
U.S.C. 552a(k)(2), the Privacy Act of 1974. Exemptions will be claimed 
for such described records only where appropriate from the following 
provisions of the Privacy Act of 1974: Subsections (c)(3); (d) (1), (2), 
(3), (4); (e)(1); (e)(4) (G), (H), and (I); and (f) of 5 U.S.C. 552a.
    (2) Reasons for claimed exemptions. a. 5 U.S.C. 552a(c)(3): This 
provision of the Privacy Act provides for the release of the disclosure 
accounting required by 5 U.S.C. 552a(c) (1) and (2) to the individual 
named in the Investigative Files. The reasons why these files are 
exempted from the foregoing provision are as follows:
    (i) The release of accounting disclosures would put the subject of a 
security investigation on notice of the existence of an investigation 
and that he is the subject of that investigation;

[[Page 90]]

    (ii) It would provide the subject of an investigation with an 
accurate accounting of the date, nature, and purpose of each disclosure 
and the name and address of the person or agency to whom the disclosure 
is made. Obviously, the release of such information to the subject of a 
security investigation would provide him with significant information 
concerning the nature of the investigation and could result in impeding 
or compromising the efforts of Bureau Security personnel to detect and 
report persons suspected of illegal, unlawful, or unauthorized activity;
    (iii) Disclosure to the individual of the disclosure accounting 
after the investigation is closed would alert the individual as to which 
agencies were investigating him and would put him on notice concerning 
the scope of his suspected improper activities and could aid him in 
avoiding detection and apprehension.
    b. 5 U.S.C. 552a(d) (1), (2), (3), (4); (e)(4) (G) and (H); and (f): 
The foregoing provisions of the Privacy Act relate to an individual's 
right to notification of the existence of records pertaining to him and 
access to such records; the agency procedures relating to notification, 
access and contest of the information continued in such records. The 
reasons why the Investigative Files are exempted from the foregoing 
provisions are as follows:
    (i) To notify an individual at his request of the existence of 
records pertaining to him in the Investigative Files would inform the 
individual of the existence of an investigation and that he is the 
subject of that investigation. This would enable the individual to avoid 
detection and would further enable him to inform co-conspirators of the 
fact that an investigation is being conducted;
    (ii) To permit access to the records contained in the Investigative 
Files would not only inform an individual that he is or was the subject 
of a security investigation, but would also provide him with significant 
information concerning the nature of the investigation which might 
enable him to avoid detection or apprehension;
    (iii) To grant access to an on-going or closed investigative file 
could interfere with Office of Security investigative proceedings, 
disclose the identity of confidential sources and reveal confidential 
information supplied by such sources, and disclose investigative 
techniques and procedures, or endanger the life or physical safety of 
Office of Security personnel, informants, witnesses, and other persons 
supplying information to investigators.
    c. 5 U.S.C. 552a(e)(4)(I). This provision of the Privacy Act 
requires the publication of the categories of sources of records in each 
system of records. The reasons why the Investigative Files are exempted 
from the foregoing provision are as follows:
    (i) Revealing sources of information could disclose investigative 
techniques and procedures;
    (ii) Revealing sources of information could result in retaliation 
and threat of reprisal by the subject under investigation against such 
sources;
    (iii) Revealing sources of information could cause witnesses, 
informants and others who supply information to Office of Security 
investigators to refrain from giving such information because of fear of 
reprisal, or fear of breach of promises of anonymity and 
confidentiality;
    (iv) Revealing sources of information could result in the refusal of 
some sources to give full and complete information or to be candid with 
investigators because of the knowledge that the identity of such sources 
may be disclosed.
    d. 5 U.S.C. 552a(e)(1): This provision of the Privacy Act requires 
each agency to maintain in its records only such information about an 
individual as is relevant and necessary to accomplish a purpose of the 
agency. The reasons why the Investigative Files are exempted from the 
foregoing provision are as follows:
    (i) In a security investigation it is difficult to determine 
accurately the relevancy and necessity of information during the process 
of information gathering. It is only after the information is evaluated 
that the relevancy and necessity of such information can be ascertained;
    (ii) In a security investigation, the Office of Security often 
obtains information concerning the violation of

[[Page 91]]

laws other than those within the scope of its responsibilities. In the 
interest of effective law enforcement, it is desirable that the Office 
of Security retain this information since it can aid in establishing 
patterns of criminal activity and provide valuable leads for those law 
enforcement agencies that are charged with enforcing other segments of 
the criminal law;
    (iii) In interviewing persons, or obtaining other forms of evidence 
during a criminal investigation, information will be supplied to the 
investigator which relates to matters which are ancillary to the main 
purpose of the investigation but which may relate to matters under the 
investigative jurisdiction of another agency. Such information is not 
readily susceptible to segregation.
    e. The foregoing exemptions are claimed for materials maintained in 
the Investigative Files to the extent that such materials contain 
information and reports described in 5 U.S.C. 552a(k)(2).
    The Bureau of Engraving and Printing exempts under section (k) of 
the Privacy Act of 1974, 5 U.S.C. 552a, the Bureau's Personnel Security 
Files and Personnel Security Files and Indices from sections (c)(3), 
(d), (e)(1), (e)(4)(G) through (e)(4)(I), and (f) of the Act. The 
records maintained in the exempt systems of records are of the type 
described in section (k)(5) of the Act:

investigatory material compiled solely for the purpose of determining 
suitability, eligibility, or qualifications for Federal civilian 
employment, military service, Federal contracts, or access to classified 
information, but only to the extent that the disclosure of such material 
would reveal the identity of a source who furnished the information to 
the Government under an express promise that the identity of the source 
would be held in confidence, or, prior to the effective date of this 
section, under an implied promise that the identity of the source would 
be held in confidence.


Thus to the extent that the records in this system can be disclosed 
without revealing the identity of a confidential source, they are not 
within the scope of this exemption and are subject to all the 
requirements of the Privacy Act.
    The sections of the Act from which this system of records are exempt 
are in general those providing for individual access to records. When 
such access would cause the identity of a confidential source to be 
revealed, it would impair the future ability of the Treasury Department 
to compile investigatory material for the purpose of determining 
suitability, eligibility, or qualifications for Federal civilian 
employment, Federal contracts, or access to classified information.
    In addition, the systems are exempt from section (e)(1) which 
requires that the agency maintain in its records only such information 
about an individual as is relevant and necessary to accomplish a 
statutory or executively ordered purpose. The Director finds that to 
fulfill the requirements of section (e)(1) would unduly restrict the 
agency in its information gathering inasmuch as it is often not until 
well after the investigation that it is possible to determine the 
relevance and necessity of particular information.
    If any investigations within the scope of section (k)(5) become 
involved with civil and criminal matters, exemptions from the Act should 
also be asserted under sections (k) (2) or (j) (2).

                           Bureau of the Mint

   Notice of rules exempting certain systems from requirements of the 
                               Privacy Act

    (a) In general. The Director of the Mint exempts investigatory files 
on theft of Mint property and examination reports of coins forwarded to 
the Mint by the U.S. Secret Service from certain subsections of 5 U.S.C. 
552a, the Privacy Act of 1974. The purpose of the exemption is to 
maintain the confidentiality of investigatory material compiled for law 
enforcement purposes.
    (b) Authority. These rules are promulgated pursuant to the authority 
vested in the Secretary of the Treasury by 5 U.S.C. 552(a)(k)(2), and 
pursuant to the authority vested in the Director of the Mint by 
paragraph 1.23(c) of subpart C of part 1 of subtitle A of title 31 of 
the Code of Federal Regulations.
    (c) Name of systems. Examination Reports of Coins Forwarded to Mint 
from U.S. Secret Service and Investigatory Files on Theft of Mint 
Property.
    (d) Provisions from which exempted. These two systems consist in 
large part

[[Page 92]]

of records generated by the U.S. Secret Service in connection with its 
responsibilities to enforce various criminal laws. Those records are 
described in 5 U.S.C. 552a(j) and are exempted from various provisions 
of the Privacy Act of 1974 by the Director of the U.S. Secret Service. 
To a lesser extent, these two systems also contain records generated and 
compiled by the Bureau of the Mint in assisting the U.S. Secret Service 
in its law enforcement efforts. Those records are described in 5 U.S.C. 
552a(k)(2), the Privacy Act of 1974. Exemptions will be claimed for such 
records only where appropriate from the following provisions, 
subsections (c)(3), (d), (e)(1), (e)(4) (G), (H), and (I) and (f) of 5 
U.S.C. 552a.
    (e) Reasons for claimed exemptions. Those provisions of the Privacy 
Act would otherwise require the Bureau of the Mint to notify an 
individual of investigatory material maintained in a record pertaining 
to him, permit access to such record, permit request for its correction 
(section 552a(d), (e)(4) (G), (H) and (f)); make available to him any 
required accounting of disclosures made of the record (section 
552a(c)(3)), publish the sources of records in the system (section 
552a(e)(4) (I)); and screen records to insure that there is maintained 
only such information about an individual as is relevant to accomplish a 
required purpose of the Bureau (section 52a(e)(1)). Disclosure to an 
individual of investigatory material pertaining to him would hamper law 
enforcement by prematurely disclosing the knowledge of illegal 
activities and the evidentiary bases for possible enforcement actions. 
Furthermore, the disclosure of certain investigatory material compiled 
for law enforcement purposes may disclose investigative techniques and 
procedures, so that future law enforcement efforts would be hindered. 
Access to an accounting of disclosures of such records would have a 
similar detrimental effect on law enforcement. Accordingly, the Director 
of the Mint finds that the public interest and public policy in 
protecting the coinage and property of the United States require 
exemption from the stated sections of the Act to the extent that they 
are applicable to appropriate materials in these two systems.

                       Comptroller of the Currency

     Notice of rules exempting certain systems of records from the 
                     requirements of the Privacy Act

    (a) In general. The Office of the Comptroller of the Currency 
exempts the following systems of records from certain provisions of the 
Privacy Act:
    (1) Enforcement and Compliance Information;
    (2) Federal Bureau of Investigation Report Card index;
    (3) Chief Counsel's Management Information System.

The purpose of the exemption is to maintain confidentiality of data 
obtained from various sources that may ultimately accomplish a statutory 
or executively-ordered purpose.
    (b) Authority. The authority to issue exemptions is vested in the 
Office of the Comptroller of the Currency, as a constituent unit of the 
Treasury Department, by 31 CFR 1.20 and 1.23(c).
    (c) Exemptions under 5 U.S.C. 552a(j)(2). (1) Under 5 U.S.C. 
552a(j)(2), the head of any agency may issue rules to exempt any system 
of records within the agency from certain provisions of the Privacy Act 
of 1974, if the agency or component that maintains the system performs 
as its principal function any activities pertaining to the enforcement 
of criminal laws. Components of the Office of the Comptroller of the 
Currency are involved in the investigation of fraudulent or other 
illegal activities as well as other sensitive matters, in order to carry 
out their bank supervisory function. Exemptions will be claimed for such 
records only where appropriate.
    (2) To the extent that the exemption under 5 U.S.C. 552a(j)(2) does 
not apply to the above named systems of records, then the exemption 
under 5 U.S.C. 552a(k)(2) relating to investigatory material compiled 
for law enforcement purposes is claimed for certain records in the 
systems. Exemptions will be claimed for such records only where 
appropriate.
    (3) The provisions of the Privacy Act of 1974 from which exemptions 
are claimed under 5 U.S.C. 552a(j)(2) are as follows:

5 U.S.C. 552a(c)(3) and (4)

[[Page 93]]

5 U.S.C. 552a(d)(1), (2), (3), (4)
5 U.S.C. 552a(e)(1), (2), and (3)
5 U.S.C. 552a(e)(4)(G), (H), and (I)
5 U.S.C. 552a(e)(5) and (8)
5 U.S.C. 552a(f)
5 U.S.C. 552a(g)

    (d) Exemptions under 5 U.S.C. 552a(k)(2). (1) Under 5 U.S.C. 
552a(k)(2), the head of any agency may issue rules to exempt any system 
of records within the agency from certain provisions of the Privacy Act 
of 1974 if the system is investigatory material compiled or law 
enforcement purposes.
    (2) To the extent that information contained in the above-named 
systems has as its principal purpose the enforcement of criminal laws, 
the exemption for such information under 5 U.S.C. 552a(j)(2) is claimed.
    (3) Provisions of the Privacy Act of 1974 from which exemptions are 
claimed under 5 U.S.C. 552a(k)(2) are as follows:

5 U.S.C. 552a(c)(3)
5 U.S.C. 552a(d)(1), (2), (3), and (4)
5 U.S.C. 552a(e)(1)
5 U.S.C. 552a(e)(4)(G), (H), and (I)
5 U.S.C. 552a(f)

    (e) Reasons for exemptions under 5 U.S.C. 552a(j)(2) and (k)(2). (1) 
5 U.S.C. 552a(c)(3) requires that an agency make accountings of 
disclosures of records available to individuals named in the records at 
their request. These accountings must state the date, nature and purpose 
of each disclosure of the record and the name and address of the 
recipient. The application of this provision would alert subjects of an 
investigation to the existence of the investigation and that such 
persons are the subjects of that investigation. Since release of such 
information to subjects of an investigation would provide the subjects 
with significant information concerning the nature of the investigation, 
it could result in the altering or destruction of documentary evidence, 
improper influencing of witnesses, and other activities that could 
impede or compromise the investigation.
    (2) 5 U.S.C. 552a(c)(4), (d)(1), (2), (3), and (4), (e)(4)(G) and 
(H), (f), and (g) relate to an individual's right to be notified of the 
existence of records pertaining to such individual; requirements for 
identifying an individual who requests access to records; the agency 
procedures relating to access to records and the content of information 
contained in such records; and the civil remedies available to the 
individual in the event of adverse determinations by an agency 
concerning access to or amendment of information contained in record 
systems. These systems are exempt from the foregoing provisions for the 
following reasons: To notify an individual at the individual's request 
of the existence of records in an investigative file pertaining to such 
individual or to grant access to an investigative file could: interfere 
with investigative and enforcement proceedings; interfere with co-
defendants' rights to a fair trial; constitute an unwarranted invasion 
of the personal privacy of others; disclose the identity of confidential 
sources and reveal confidential information supplied by these sources; 
or disclose investigative techniques and procedures.
    (3) 5 U.S.C. 552a(e)(4)(I) requires the publication of the 
categories of sources of records in each system of records. The 
application of this provision could disclose investigative techniques 
and procedures and cause sources to refrain from giving such information 
because of fear of reprisal, or fear of breach of promises of anonymity 
and confidentiality. This would compromise the ability to conduct 
investigations, and to identify, detect, and apprehend violators.
    (4) 5 U.S.C. 552a(e)(1) requires each agency to maintain in its 
records only such information about an individual that is relevant and 
necessary to accomplish a purpose of the agency required by statute or 
Executive order. An exemption from the foregoing is needed:
    (i) Because it is not possible to detect relevance or necessity of 
specific information in the early stages of a criminal or other 
investigation.
    (ii) Relevance and necessity are questions of judgment and timing. 
What appears relevant and necessary when collected may ultimately be 
determined to be unnecessary. It is only after the information is 
evaluated that the relevance can be established.
    (iii) In any investigation the Comptroller of the Currency may 
obtain information concerning violations of

[[Page 94]]

laws other than those within the scope of its jurisdiction. In the 
interest of effective law enforcement, the Comptroller of the Currency 
should retain this information as it may aid in establishing patterns of 
criminal activity, and provide leads for those law enforcement agencies 
charged with enforcing other segments of criminal or civil law.
    (iv) In interviewing persons, or obtaining other forms of evidence 
during an investigation, information may be supplied to the investigator 
which relates to matters incidental to the main purpose of the 
investigation but which may relate to matters under the investigative 
jurisdiction of another agency. Such information cannot readily be 
segregated.
    (5) 5 U.S.C. 552a(e)(2) requires an agency to collect information to 
the greatest extent practicable directly from the subject individual 
when the information may result in adverse determinations about an 
individual's rights, benefits, and privileges under Federal programs. 
The application of the provision would impair investigations for the 
following reasons:
    (i) In certain instances the subject of an investigation cannot be 
required to supply information to investigators. In those instances, 
information relating to a subject's illegal acts, violations of rules of 
conduct, or any other misconduct, etc., must be obtained from other 
sources.
    (ii) Most information collected about an individual under 
investigation is obtained from third parties such as witnesses and 
informers. It is not feasible to rely upon the subject of the 
investigation as a source for information regarding his activities.
    (iii) The subject of an investigation will be alerted to the 
existence of an investigation if an attempt is made to obtain 
information from the subject. This would afford the individual the 
opportunity to conceal any criminal activities in order to avoid 
apprehension.
    (iv) In any investigation it is necessary to obtain evidence from a 
variety of sources other than the subject of the investigation in order 
to verify the evidence necessary for successful litigation.
    (6)(i) 5 U.S.C. 552a(e)(3) requires that an agency must inform the 
subject of an investigation who is asked to supply information of:
    (A) The authority under which the information is sought and whether 
disclosure of the information is mandatory or voluntary,
    (B) The purposes for which the information is intended to be used,
    (C) The routine uses which may be made of the information, and
    (D) The effects on the subject, if any, of not providing the 
requested information.
    (ii) The reasons for exempting these systems of records from the 
foregoing provision are as follows:
    (A) The disclosure to the subject of the investigation as stated in 
paragraph (e)(6)(i)(B) would provide the subject with substantial 
information relating to the nature of the investigation and could impede 
or compromise the investigation.
    (B) If the subject were informed as required by this provision, it 
could seriously interfere with information-gathering activities by 
requiring disclosure of sources of information and, therefore, impairing 
the successful conclusion of the investigation.
    (C) Individuals may be contacted during preliminary information-
gathering in investigations before any individual is identified as the 
subject of an investigation. Informing the individual of the matters 
required by this provision would hinder or adversely affect any present 
or subsequent investigations.
    (7) 5 U.S.C. 552a(e)(5) requires that records be maintained with 
such accuracy, relevance, timeliness, and completeness as is reasonably 
necessary to assure fairness to the individual in making any 
determination about an individual. Since the law defines ``maintain'' to 
include the collection of information, complying with this provision 
would prevent the collection of any data not shown to be accurate, 
relevant, timely, and complete at the moment of its collection. In 
gathering information during the course of an investigation it is not 
possible to determine this prior to collection of the information. Facts 
are first gathered and then placed in a logical order which objectively 
proves or disproves suspected

[[Page 95]]

behavior on the part of the suspect. Material which may seem unrelated, 
irrelevant, incomplete, untimely, etc., may take on added meaning as an 
investigation progresses. The restrictions in this provision could 
interfere with the preparation of a complete investigative report.
    (8) 5 U.S.C. 552a(e)(8) requires an agency to make reasonable 
efforts to serve notice on an individual when any record on such 
individual is made available to any person under compulsory legal 
process when such process becomes a matter of public record. The notice 
requirement of this provision could prematurely reveal an ongoing 
investigation to the subject of the investigation.
    (f) Documents exempted. Exemption will be claimed for certain 
records only where appropriate under the above provisions.

                      OFFICE OF THRIFT SUPERVISION

                        NOTICE OF EXEMPT SYSTEMS

    In accordance with 5 U.S.C. 552a (j) and (k), general notice is 
hereby given of rulemaking pursuant to the Privacy Act of 1974 by the 
Director, Office of Thrift Supervision, under authority delegated to him 
by the Secretary of the Treasury. The Director, Office of Thrift 
Supervision, exempts the systems of records identified in the paragraphs 
below from certain provisions of the Privacy Act of 1974 as set forth in 
such paragraphs.
    a. General exemptions under 5 U.S.C. 552a(j)(2). Pursuant to the 
provisions of 5 U.S.C. 552a(j)(2), the Director, Office of Thrift 
Supervision, hereby exempts certain systems of records, maintained by 
the Office of Thrift Supervision, from the provisions of 5 U.S.C. 
552a(c) (3) and (4), (d) (1), (2), (3) and (4), (e) (1), (2), (3), 
(4)(G), (H) and (I), (5) and (8), (f) and (g).
    1. Exempt Systems. The following systems of records, which contain 
information of the type described in 5 U.S.C. 552a(j)(2), shall be 
exempt from the provisions of 5 U.S.C. 552a listed in paragraph a. above 
except as otherwise indicated below and in the general notice of the 
existence and character of systems of records which appears elsewhere in 
the Federal Register
.001 -- Confidential Individual Information System
.004 -- Criminal Referral Database
    2. Reasons for exemptions. (a) 5 U.S.C. 552a (e)(4)(G) and (f)(1) 
enable individuals to be notified whether a system of records contains 
records pertaining to them. The OTS believes that application of these 
provisions to the above-listed systems of records would give individuals 
an opportunity to learn whether they are the subject of an 
administrative investigation; this would compromise the ability of the 
OTS to complete investigations and to detect and apprehend violators of 
applicable laws in that individuals would thus be able (1) to take steps 
to avoid detection, (2) to inform co-conspirators of the fact that an 
investigation is being conducted, (3) to learn the nature of the 
investigation to which they are being subjected, (4) to learn the type 
of surveillance being utilized, (5) to learn whether they are the 
subject of investigation or identified law violators, (6) to continue or 
resume their illegal conduct without fear of detection upon learning 
that they are not in a particular system of records, and (7) to destroy 
evidence needed to prove a violation.
    (b) 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f)(2), (3) and (5) enable 
individuals to gain access to records pertaining to them. The OTS 
believes that application of these provisions to the above-listed 
systems of records would compromise its ability to complete or continue 
administrative investigations and to detect and apprehend violators of 
applicable laws. Permitting access to records contained in the above-
listed systems of records would provide individuals with significant 
information concerning the nature of the investigation, and this could 
enable them to avoid detection or apprehension in the following ways: 
(1) by discovering the collection of facts which would form the basis of 
an enforcement action, and (2) by enabling them to destroy evidence of 
wrongful conduct which would form the basis of an enforcement action. 
Granting access to on-going or closed investigative files would also 
reveal investigative techniques and procedures, the knowledge of which 
could

[[Page 96]]

enable individuals planning illegal activity to structure their future 
operations in such a way as to avoid detection or apprehension, thereby 
neutralizing established investigative techniques and procedures. 
Further, granting access to investigative files and records could 
disclose the identities of confidential sources and other informers and 
the nature of the information which they supplied, thereby exposing them 
to possible reprisals for having provided information related to the 
activities of those individuals who are subjects of the investigative 
files and records; confidential sources and other informers might refuse 
to provide investigators with valuable information if they could not be 
secure in the knowledge that their identities would not be revealed 
through disclosure of either their names or the nature of the 
information they supplied, and this would seriously impair the ability 
of the OTS to carry out its mandate to enforce the applicable laws. 
Additionally, providing access to records contained in the above-listed 
systems of records could reveal the identities of individuals who 
compiled information regarding illegal activities, thereby exposing them 
to possible reprisals.
    (c) 5 U.S.C. 552a(d) (2), (3) and (4), (e)(4)(H) and (f)(4), which 
are dependent upon access having been granted to records pursuant to the 
provisions cited in paragraph (b) above, enable individuals to contest 
(seek amendment to) the content of records contained in a system of 
records and require an agency to note an amended record and to provide a 
copy of an individual's statement (of disagreement with the agency's 
refusal to amend a record) to persons or other agencies to whom the 
record has been disclosed. The OTS believes that the reasons set forth 
in paragraph (b) above are equally applicable to this subparagraph and, 
accordingly, those reasons are hereby incorporated herein by reference.
    (d) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of 
disclosures of records available to individuals named in the records at 
their request; such accountings must state the date, nature and purpose 
of each disclosure of a record and the name and address of the 
recipient. The OTS believes that application of this provision to the 
above-listed systems of records would impair the ability of other law 
enforcement agencies to make effective use of information provided by 
the OTS in connection with the investigation, detection and apprehension 
of violators of the laws enforced by those other law enforcement 
agencies. Making accountings of disclosure available to subjects would 
alert those individuals to the fact that another agency is conducting an 
investigation into their activities, and this could reveal the nature 
and purpose of that investigation, and the dates on which that 
investigation was active. Subjects possessing such knowledge would 
thereby be able to take appropriate measures to avoid detection or other 
apprehension by altering their operations, or by destroying or 
concealing evidence which would form the basis of an enforcement action. 
In addition, providing subjects with accountings of disclosure would 
inform those individuals of general information, and alert them that the 
OTS has information regarding their activities; this, in turn, would 
afford those individuals a better opportunity to take appropriate steps 
to avoid detection or apprehension.
    (e) 5 U.S.C. 552a(c)(4) requires that an agency inform any person or 
other agency about any correction or notation of dispute made by the 
agency in accordance with 5 U.S.C. 552(d) of any record that has been 
disclosed to the person or agency if an accounting of the record was 
made. Since this provision is dependent on an individual's having been 
provided an opportunity to contest (seek amendment to) records 
pertaining to him, and since the above-listed systems of records are 
proposed to be exempted from those provisions of 5 U.S.C. 552a relating 
to amendments of records as indicated in paragraph (c) above, the OTS 
believes that this provision should not be applicable to the above-
listed systems of records.
    (f) 5 U.S.C. 552a(e)(4)(I) requires that an agency publish a public 
notice listing the categories of sources for information contained in a 
system of

[[Page 97]]

records. The OTS believes that application of this provision to the 
above-listed systems of records could compromise its ability to conduct 
investigations and to identify, detect and apprehend violators of the 
applicable laws for the reasons that revealing sources for information 
could 1) disclose investigative techniques and procedures, 2) result in 
possible reprisal directed to informers by the subject under 
investigation, and 3) result in the refusal of informers to give 
information or to be candid with investigators because of the knowledge 
that their identities as sources might be disclosed.
    (g) 5 U.S.C. 552a(e)(1) requires that an agency maintain in its 
records only such information about an individual as is relevant and 
necessary to accomplish a purpose of the agency required to be 
accomplished by statute or executive order. The term ``maintain'' as 
defined in 5 U.S.C. 552a(a)(3) includes ``collect'' and ``disseminate.'' 
At the time that information is collected by the OTS, there is often 
insufficient time to determine whether the information is relevant and 
necessary to accomplish a purpose of the OTS; in many cases information 
collected may not be immediately susceptible to a determination whether 
the information is relevant and necessary, particularly in the early 
stages of an investigation, and in many cases information which 
initially appears to be irrelevant and unnecessary may, upon further 
evaluation or upon continuation of the investigation, prove to have 
particular relevance to an enforcement program of OTS. Further, not all 
violations of law discovered during an OTS administrative investigation 
fall within the investigative jurisdiction of OTS; in order to promote 
effective law enforcement, OTS is often required to disseminate 
information pertaining to such violations to other law enforcement 
agencies which have jurisdiction over the offense to which the 
information relates. The OTS therefore believes that it is appropriate 
to exempt the above-listed systems of records from the provisions of 5 
U.S.C. 552a(e)(1).
    (h) 5 U.S.C. 552a(e)(2) requires that an agency collect information 
to the greatest extent practicable directly from the subject individual 
when the information may result in adverse determinations about an 
individual's rights, benefits, and privileges under Federal programs. 
The OTS believes that application of this provision to the above-listed 
systems of records would impair the ability of OTS to conduct 
investigations and to identify, detect and apprehend violators of 
applicable laws for the following reasons: (1) most information 
collected about an individual under investigation is obtained from third 
parties such as witnesses and informers, and it is usually not feasible 
to rely upon the subject of the investigation as a source for 
information regarding his activities, (2) an attempt to obtain 
information from the subject regarding an investigation will often alert 
the subject to the existence of such an investigation, thereby affording 
him an opportunity to conceal his activities so as to avoid 
apprehension, (3) in certain instances individuals are not required to 
supply information to investigators as a matter of legal duty, and (4) 
during investigations it is often a matter of sound investigative 
procedures to obtain information from a variety of sources in order to 
verify information already obtained.
    (i) 5 U.S.C. 552a(e)(3) requires that an agency inform each 
individual whom it asks to supply information, on the form which it uses 
to collect the information or on a separate form that can be retained by 
the individual, of the authority which authorizes the solicitation of 
the information and whether disclosure of such information is mandatory 
or voluntary; the principal purposes for which the information is 
intended to be used; the routine uses which may be made of the 
information; and the effects on the individual of not providing all or 
part of the requested information. The OTS believes that the above-
listed systems of records should be exempted from this provision in 
order to avoid adverse effects on its ability to identify, detect and 
apprehend violators of applicable laws. In many cases, information is 
obtained from confidential sources and other individuals under 
circumstances where it is necessary that the true purpose of their 
actions be kept secret so as not

[[Page 98]]

to alert the subject of the investigation or his associates that an 
investigation is in progress. In many cases, individuals for personal 
reasons would feel inhibited in talking to a person representing a law 
enforcement agency but would be willing to talk to a confidential source 
or a person who they believed was not involved in enforcement activity. 
In addition, providing information in this system with written evidence 
of who was the source, as required by this provision, could increase the 
likelihood that the source of information would be the subject of 
retaliatory action by the subject of the investigation. Further, 
application of this provision could result in an unwarranted invasion of 
the personal privacy of the subject of the investigation, particularly 
where further investigation would result in a finding that he was not 
involved in unlawful activity.
    (j) 5 U.S.C. 552a(e)(5) requires that an agency maintain all records 
used by the agency in making any determination about any individual with 
such accuracy, relevance, timeliness, and completeness as is reasonably 
necessary to assure fairness to the individual in the determination. 
Since 5 U.S.C. 552a(a)(3) defines ``maintain'' to include ``collect'' 
and ``disseminate,'' application of this provision to the above-listed 
systems of records would hinder the initial collection of any 
information which could not, at the moment of collection, be determined 
to be accurate, relevant, timely and complete. Similarly, application of 
this provision would seriously restrict the necessary flow of 
information from the OTS to other law enforcement agencies where an OTS 
investigation revealed information pertaining to a violation of law 
which was under the investigative jurisdiction of another agency. In 
collecting information during the course of an administrative 
investigation, it is not possible or feasible to determine accuracy, 
relevance, timeliness or completeness prior to collection of the 
information; in disseminating information to other law enforcement 
agencies it is often not possible to determine accuracy, relevance, 
timeliness or completeness prior to dissemination because the 
disseminating agency may not have the expertise with which to make such 
determinations. Further, information which may initially appear 
inaccurate, irrelevant, untimely or incomplete may, when gathered, 
grouped, and evaluated with other available information, become more 
pertinent as an investigation progresses. The OTS therefore believes 
that it is appropriate to exempt the above-listed systems of records 
from the provisions of 5 U.S.C. 552a(e)(5).
    (k) 5 U.S.C. 552a(e)(8) requires that an agency make reasonable 
efforts to serve notice on an individual when any record on the 
individual is made available to any person under compulsory legal 
process when such process becomes a matter of public record. The OTS 
believes that the above-listed systems of records should be exempt from 
this provision in order to avoid revealing investigative techniques and 
procedures outlined in those records and in order to prevent revelation 
of the existence of an on-going investigation where there is a need to 
keep the existence of the investigation secret.
    (l) 5 U.S.C. 552a(g) provides civil remedies to an individual for an 
agency refusal to amend a record or to make a review of a request for 
amendment, for an agency refusal to grant access to a record, for an 
agency failure to maintain accurate, relevant, timely and complete 
records which are used to make a determination which is adverse to the 
individual, and for an agency failure to comply with any other provision 
of 5 U.S.C. 552a in such a way as to have an adverse effect on an 
individual. The OTS believes that the above-listed systems of records 
should be exempted from this provision to the extent that the civil 
remedies provided therein may be related to provisions of 5 U.S.C. 552a 
from which the above-listed systems of records are proposed to be 
exempt. Since the provisions of 5 U.S.C. 552a enumerated in paragraphs 
(a) through (k) above are proposed to be inapplicable to the above-
listed systems of records for the reasons stated therein, there should 
be no corresponding civil remedies for failure to comply with the 
requirements of those provisions to which the exemption is proposed to 
apply. Further, the OTS believes that the application of this provision 
to the above-listed systems

[[Page 99]]

of records would adversely affect its ability to conduct investigations 
by exposing to civil court actions every stage of the investigative 
process in which information is compiled or used in order to identify, 
detect, apprehend and otherwise investigate persons suspected or known 
to be engaged in conduct in violation of applicable laws.
    b. Specific exemptions under 5 U.S.C. 552a(k)(2). Pursuant to the 
provisions of 5 U.S.C. 552a(k)(2), the OTS hereby exempts certain 
systems of records, maintained by the OTS from the provisions of 5 
U.S.C. 552a(c)(3), (d)(1), (2), (3) and (4), (e)(1) and (4)(G), (H) and 
(I) and (f).
    1. Exempt Systems. The following systems of records, which contain 
information of the type described in 5 U.S.C. 552a(k)(2), shall be 
exempt from the provisions of 5 U.S.C. 552a listed in paragraph b. above 
except as otherwise indicated below and in the general notice of the 
existence and character of systems of records which appears elsewhere in 
the Federal Register:
.001 -- Confidential Individual Information System
.004 -- Criminal Referral Database
    2. Reasons for exemptions. (a) 5 U.S.C. 552a (e)(4)(G) and (f)(1) 
enable individuals to be notified whether a system of records contains 
records pertaining to them. The OTS believes that application of these 
provisions to the above-listed systems of records would impair the 
ability of the OTS to successfully complete investigations and inquiries 
of suspected violators of laws and regulations under its jurisdiction. 
In many cases investigations and inquiries into violations of laws and 
regulations involve complex and continuing patterns of behavior. 
Individuals, if informed that they have been identified as the subject 
of an investigation, would have an opportunity to take measures to 
prevent detection of illegal action so as to avoid prosecution or the 
imposition of civil sanctions. They would also be able to learn the 
nature and location of the investigation and the type of inquiry being 
made, and they would be able to transmit this knowledge to co-
conspirators. Finally, subjects might be given the opportunity to 
destroy evidence needed to prove the violation under investigation or 
inquiry.
    (b) 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f)(2), (3) and (5) enable 
individuals to gain access to records pertaining to them. The OTS 
believes that application of these provisions to the above-listed 
systems of records would impair its ability to complete or continue 
investigations and inquiries and to detect and apprehend violators of 
the applicable laws. Permitting access to records contained in the 
above-listed systems of records would provide subjects with significant 
information concerning the nature of the investigation or inquiry. 
Knowledge of the facts developed during an investigation or inquiry 
would enable violators of laws and regulations to learn the extent to 
which the investigation or inquiry has progressed, and this could 
provide them with an opportunity to destroy evidence that would form the 
basis for the imposition of civil sanctions. In addition, knowledge 
gained through access to investigatory material could alert a subject to 
the need to temporarily postpone commission of the violation or to 
change the intended point where the violation is to be committed so as 
to avoid detection or apprehension. Further, access to investigatory 
material would disclose investigative techniques and procedures which, 
if known, could enable individuals to structure their future operations 
in such a way as to avoid detection or apprehension, thereby 
neutralizing investigators' established and effective investigative 
tools and procedures. In addition, investigatory material may contain 
the identity of confidential sources who would not want their identity 
to be disclosed for reasons of personal privacy or for fear of reprisal 
at the hands of the individual about whom they supplied information. In 
some cases mere disclosure of the information provided by a source would 
reveal the identity of the source either through the process of 
elimination or by virtue of the nature of the information supplied. If 
sources could not be assured that their identities (as sources for 
information) would remain confidential, they would be very reluctant in 
the future to provide information pertaining to violations of laws and 
regulations, and this would seriously compromise the ability of the

[[Page 100]]

OTS to carry out its mission. Further, application of 5 U.S.C. 552a 
(d)(1), (e)(4)(H) and (f)(2), (3) and (5) to the above-listed systems of 
records would make available attorney's work product and other documents 
which contain evaluations, recommendations, and discussions of ongoing 
legal proceedings; the availability of such documents could have a 
chilling effect on the free flow of information and ideas within the OTS 
which is vital to the agency's predecisional deliberative process, could 
seriously prejudice the agency's or the Government's position in 
litigation, and could result in the disclosure of investigatory material 
which should not be disclosed for the reasons stated above. It is the 
belief of the OTS that due process will assure that individuals have a 
reasonable opportunity to learn of the existence of, and to challenge, 
investigatory records and related materials which are to be used in 
legal proceedings.
    (c) 5 U.S.C. 552a(d) (2), (3) and (4), (e)(4)(H) and (f)(4), which 
are dependent upon access having been granted to records pursuant to the 
provisions cited in subparagraph (b) above, enable individuals to 
contest (seek amendment to) the content of records contained in a system 
of records and require an agency to note an amended record and to 
provide a copy of an individual's statement (of disagreement with the 
agency's refusal to amend a record) to persons or other agencies to whom 
the record has been disclosed. The OTS believes that the reasons set 
forth in subparagraph (b) above are equally applicable to this 
subparagraph, and, accordingly, those reasons are hereby incorporated 
herein by reference.
    (d) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of 
disclosures of records available to individuals named in the records at 
their request; such accountings must state the date, nature and purpose 
of each disclosure of a record and the name and address of the 
recipient. The OTS believes that application of this provision to the 
above-listed systems of records would impair the ability of the OTS and 
other law enforcement agencies to conduct investigations and inquiries 
into potential violations under their respective jurisdictions. Making 
accountings available to subjects would alert those individuals to the 
fact that the OTS or another law enforcement authority is conducting an 
investigation or inquiry into their activities, and such accountings 
could reveal the geographic location of the investigation or inquiry, 
the nature and purpose of the investigation or inquiry and the nature of 
the information disclosed, and dates on which that investigation or 
inquiry was active. Subjects possessing such knowledge would thereby be 
able to take appropriate measures to avoid detection or apprehension by 
altering their operations, transferring their activities to other 
locations or destroying or concealing evidence which would form the 
basis for prosecution or the imposition of civil sanctions.
    (e) 5 U.S.C. 552a(e)(1) requires that an agency maintain in its 
records only such information about an individual as is relevant and 
necessary to accomplish a purpose of the agency required to be 
accomplished by statute or executive order. The term ``maintain'' as 
defined in 5 U.S.C. 552a(a)(3) includes ``collect'' and ``disseminate.'' 
At the time that information is collected by the OTS there is often 
insufficient time to determine whether the information is relevant and 
necessary to accomplish a purpose of the OTS; in many cases information 
collected may not be immediately susceptible to a determination of 
whether the information is relevant and necessary, particularly in the 
early stages of investigation or inquiry; and in many cases information 
which initially appears to be irrelevant and unnecessary may, upon 
further evaluation or upon continuation of the investigation or inquiry, 
prove to have particular relevance to an enforcement program of the OTS. 
Further, not all violations of law uncovered during an OTS investigation 
or inquiry fall within the jurisdiction of the OTS; in order to promote 
effective law enforcement it often becomes necessary and desirable to 
disseminate information pertaining to such violations to other law 
enforcement agencies which have jurisdiction over the offense to which 
the information relates. The OTS therefore

[[Page 101]]

believes that it is appropriate to exempt the above-listed systems of 
records from provisions of 5 U.S.C. 552a(e)(1).

[40 FR 45692, Oct 2, 1975, as amended at 44 FR 7141, Feb. 6, 1979; 44 FR 
42189, July 19, 1979; 45 FR 13455, Feb. 29, 1980; 48 FR 21945, May 16, 
1983; 48 FR 48460, Oct. 19, 1983; 52 FR 11990, Apr. 14, 1987; 56 FR 
12447, Mar. 26, 1991; 59 FR 47538, Sept. 16, 1994; 61 FR 387, Jan. 5, 
1996; 62 FR 19505, Apr. 22, 1997; 62 FR 26939, May 16, 1997; 62 FR 
58908, Oct. 31, 1997; 62 FR 60782, Nov. 13, 1997; 64 FR 62586, Nov. 17, 
1999]

                         Appendices to subpart C

                    Appendix A--Departmental Offices

    1. In general. This appendix applies to the Departmental Offices as 
defined in 31 CFR part 1, subpart C, Sec. 1.20. It sets forth specific 
notification and access procedures with respect to particular systems of 
records, identifies the officers designated to make the initial 
determinations with respect to notification and access to records, the 
officers designated to make the initial and appellate determinations 
with respect to requests for amendment of records, the officers 
designated to grant extensions of time on appeal, the officers with whom 
``Statement of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e)(4) and (11) and published 
annually by the Office of the Federal Register in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Departmental Offices, will be made by the head of 
the organizational unit having immediate custody of the records 
requested, or the delegate of such official. This information is 
contained in the appropriate system notice in the ``Privacy Act 
Issuances'', published annually by the Office of the Federal Register. 
Requests for information and specific guidance on where to send requests 
for records should be addressed to:
    Privacy Act Request, DO, Department of the Treasury, 1500 
Pennsylvania Avenue, NW., Washington, DC 20220.
    Requests may be delivered personally to the Main Treasury Building, 
Room 5030, 1500 Pennsylvania Avenue NW., Washington, DC.
    3. Requests for amendments of records. Initial determinations under 
31 CFR 1.27(a) through (d) with respect to requests to amend records for 
records maintained by the Departmental Offices will be made by the head 
of the organization or unit having immediate custody of the records or 
the delegate of such official. Requests for amendment of records should 
be addressed as indicated in the appropriate system notice in ``Privacy 
Act Issuances'' published by the Office of the Federal Register. 
Requests for information and specific guidance on where to send these 
requests should be addressed to: Privacy Act Amendment Request, DO, 
Department of the Treasury, 1500 Pennsylvania Avenue, NW., Washington, 
DC 20220.
    4. Administrative appeal of initial determination refusing to amend 
record. Appellate determinations under 31 CFR 1.27(e) with respect to 
records of the Departmental Offices, including extensions of time on 
appeal, will be made by the Secretary, Deputy Secretary, Under 
Secretary, General Counsel, or Assistant Secretary having jurisdiction 
over the organizational unit which has immediate custody of the records, 
or the delegate of such official, as limited by 5 U.S.C. 552a(d) (2) and 
(3). Appeals made by mail should be addressed as indicated in the letter 
of initial decision or to:
    Privacy Act Amendment Request, DO Department of the Treasury, 1500 
Pennsylvania Avenue, NW., Washington, DC 20220. Appeals may be delivered 
personally to the Library, Room 5030, Main Treasury Building, 1500 
Pennsylvania Avenue, NW., Washington, DC.
    5. Statements of disagreement. ``Statements of Disagreement'' as 
described in 31 CFR 1.27(e)(4) shall be filed with the official signing 
the notification of refusal to amend at the address indicated in the 
letter of notification within 35 days of the date of notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
General Counsel of the Department of the Treasury or the delegate of 
such official and shall be delivered to the following location:
    General Counsel, Department of the Treasury, Room 3000, Main 
Treasury Building, 1500 Pennsylvania Avenue, NW., Washington, DC 20220.
    7. Annual notice of systems of records. The annual notice of systems 
of records required to be published by the Office of the Federal 
Register in the publication entitled ``Privacy Act Issuances'', as 
specified in 5 U.S.C. 552a (f). Any specific requirements for access, 
including identification requirements, in addition to the requirements 
set forth in 31 CFR 1.26 and 1.27 and 8 of this appendix, and locations 
for access are indicated in the notice for the pertinent system.
    8. Verification of identity. An individual seeking notification or 
access to records, or seeking to amend a record, must satisfy one of the 
following identification requirements before action will be taken by the 
Departmental Offices on any such request:

[[Page 102]]

    (i) An individual seeking notification or access to records in 
person, or seeking to amend a record in person, may establish identity 
by the presentation of a single official document bearing a photograph 
(such as a passport or identification badge) or by the presentation of 
two items of identification which do not bear a photograph but do bear 
both a name and signature (such as a driver's license or credit card).
    (ii) An individual seeking notification or access to records by 
mail, or seeking to amend a record by mail, may establish identity by a 
signature, address, and one other identifier such as a photocopy of a 
driver's license or other official document bearing the individual's 
signature.
    (iii) Notwithstanding subdivisions (i) and (ii) of this 
subparagraph, an individual seeking notification or access to records by 
mail or in person, or seeking to amend a record by mail or in person, 
who so desires, may establish identity by providing a notarized 
statement, swearing or affirming to such individual's identity and to 
the fact that the individual understands the penalties provided in 5 
U.S.C. 552a(i)(3) for requesting or obtaining access to records under 
false pretenses.
Notwithstanding subdivision (i), (ii), or (iii) of this subparagraph, a 
designated official may require additional proof of an individual's 
identity before action will be taken on any request, if such official 
determines that it is necessary to protect against unauthorized 
disclosure of information in a particular case. In addition, a parent of 
any minor or a legal guardian of any individual will be required to 
provide adequate proof of legal relationship before such person may act 
on behalf of such minor or such individual.

                  Appendix B--Internal Revenue Service

    1. Purpose. The purpose of this section is to set forth the 
procedures that have been established by the Internal Revenue Service 
for individuals to exercise their rights under the Privacy Act of 1974 
(88 Stat. 1896) with respect to systems of records maintained by the 
Internal Revenue Service, including the Office of the Chief Counsel. The 
procedures contained in this section are to be promulgated under the 
authority of 5 U.S.C. 552a(f). The procedures contained in this section 
relate to the following:
    (a) The procedures whereby an individual can be notified in response 
to a request if a system of records named by the individual contains a 
record pertaining to such individual (5 U.S.C. 552a(f)(1)).
    (b) The procedures governing reasonable times, places, and 
requirements for identifying an individual who requests a record of 
information pertaining to such individual before the Internal Revenue 
Service will make the record or information available to the individual 
(5 U.S.C. 552a (f)(2)).
    (c) The procedures for the disclosure to an individual upon a 
request of a record of information pertaining to such individual, 
including special procedures for the disclosure to an individual of 
medical records, including psychological records. (5 U.S.C. 552a 
(f)(3)).
    (d) The procedures for reviewing a request from an individual 
concerning the amendment of any record or information pertaining to the 
individual, for making a determination on the request, for an appeal 
within the Internal Revenue Service of an initial adverse agency 
determination, and for whatever additional means may be necessary for 
individuals to be able to exercise fully their right under 5 U.S.C. 552a 
(5 U.S.C. 552a (f)(4)).
    Any individual seeking to determine whether a system of records 
maintained by any office of the Internal Revenue Service contains a 
record or information pertaining to such individual, or seeking access 
to, or amendment of, such a record, must comply fully with the 
applicable procedure contained in paragraph (3) or (4) of this section 
before the Internal Revenue Service will act on the request. Neither the 
notification and access (or accounting of disclosures) procedures under 
paragraph (3) of this section nor the amendment procedures under 
paragraph (4) of this section are applicable to (i) systems of records 
exempted pursuant to 5 U.S.C. 552a (j) and (k), (ii) information 
compiled in reasonable anticipation of a civil action or proceeding (see 
5 U.S.C. 552a (d)(5)), or (iii) information pertaining to an individual 
which is contained in, and inseparable from, another individual's 
record.
    2. Access to and amendment of tax records. The provisions of the 
Privacy Act of 1974 may not be used by an individual to amend or correct 
any tax record. The determination of liability for taxes imposed by the 
Internal Revenue Service Code, the collection of such taxes, and the 
payment (including credits or refunds of overpayments) of such taxes are 
governed by the provisions of the Internal Revenue Service Code and by 
the procedural rules of the Internal Revenue Service. These provisions 
set forth the established procedures governing the determination of 
liability for tax, the collection of such taxes, and the payment 
(including credits or refunds of overpayments) of such taxes. In 
addition, these provisions set forth the procedures (including 
procedures for judicial review) for resolving disputes between taxpayers 
and the Internal Revenue Service involving the amount of tax owed, or 
the payment or collection of such tax. These procedures are the 
exclusive means available to an individual to contest the amount of any 
liability for tax or the payment or collection thereof. See, for 
example, 26 CFR 601.103 for summary of general tax procedures. 
Individuals are advised

[[Page 103]]

that Internal Revenue Service procedures permit the examination of tax 
records during the course of an investigation, audit, or collection 
activity. Accordingly, individuals should contact the Internal Revenue 
Service employee conducting an audit or effecting the collection of tax 
liabilities to gain access to such records, rather than seeking access 
under the provisions of the Privacy Act. Where, on the other hand, an 
individual desires information or records not in connection with an 
investigation, audit, or collection activity, the individual may follow 
these procedures.
    3. Procedures for access to records--(a) In general. This paragraph 
sets forth the procedure whereby an individual can be notified in 
response to a request if a system of records named by the individual 
which is maintained by the Internal Revenue Service contains a record 
pertaining to such individual. In addition, this paragraph sets forth 
the procedure for the disclosure to an individual upon a request of a 
record or information pertaining to such individual, including the 
procedures for verifying the identity of the individual before the 
Internal Revenue Service will make a record available, and the procedure 
for requesting an accounting of disclosures of such records. An 
individual seeking to determine whether a particular system of records 
contains a record or records pertaining to such individual and seeking 
access to such records (or seeking an accounting of disclosures of such 
records) shall make a request for notification and access (or a request 
for an accounting of disclosures) in accordance with the rules provided 
in paragraph 3(b) of this section.
    (b) Form of request for notification and access or request for an 
accounting of disclosures. (i) A request for notification and access (or 
request for an accounting of disclosures) shall be made in writing and 
shall be signed by the person making the request.
    (ii) Such request shall be clearly marked, ``Request for 
notification and access,'' or ``Request for accounting of disclosures.''
    (iii) Such a request shall contain a statement that it is being made 
under the provisions of the Privacy Act of 1974.
    (iv) Such request shall contain the name and address of the 
individual making the request. In addition, if a particular system 
employs an individual's social security number as an essential means of 
accessing the system, the request must include the individual's social 
security number. In the case of a record maintained in the name of two 
or more individuals (e.g., husband and wife), the request shall contain 
the names, addresses, and social security numbers (if necessary) of both 
individuals.
    (v) Such request shall specify the name and location of the 
particular system of records (as set forth in the Notice of Systems) for 
which the individual is seeking notification and access (or an 
accounting of disclosures), and the title and business address of the 
official designated in the access section for the particular system (as 
set forth in the Notice of Systems). In the case of two or more systems 
of records which are under the control of the same designated official 
at the same systems location, a single request may be made for such 
systems. In the case of two or more systems of records which are not in 
the control of the same designated official at the same systems 
location, a separate request must be made for each such system.
    (vi) If an individual wishes to limit a request for notification and 
access to a particular record or records, the request should identify 
the particular record. In the absence of a statement to the contrary, a 
request for notification and access for a particular system of records 
shall be considered to be limited to records which are currently 
maintained by the designated official at the systems location specified 
in the request.
    (vii) If such request is seeking notification and access to material 
maintained in a system of records which is exempt from disclosure and 
access under 5 U.S.C. 552a (k)(2), the individual making the request 
must establish that such individual has been denied a right, privilege, 
or benefit that such individual would otherwise be entitled to under 
Federal law as a result of the maintenance of such material.
    (viii) Such request shall state whether the individual wishes to 
inspect the record in person, or desires to have a copy made and 
furnished without first inspecting it. If the individual desires to have 
a copy made, the request must include an agreement to pay the fee for 
duplication ultimately determined to be due. If the individual does not 
wish to inspect a record, but merely wishes to be notified whether a 
particular system or records contains a record pertaining to such 
individual, the request should so state.
    (c) Time and place for making a request. A request for notification 
and access to records under the Privacy Act (or a request for accounting 
of disclosures) shall be addressed to or delivered in person to the 
office of the official designated in the access section for the 
particular system of records for which the individual is seeking 
notification and access (or an accounting of disclosures). The title and 
office address of such official is set forth for each system of records 
in the Notice of Systems of Records. A request delivered to an office in 
person must be delivered during the regular office hours of that office.
    (d) Sample request for notification and access to records. The 
following are sample requests for notification and access to records 
which will satisfy the requirements of this paragraph:

[[Page 104]]

         Request for Notification and Access to Records by Mail

    I, John Doe, of 100 Main Street, Boston, MA 02108 (soc. sec. num. 
000-00-0000) request under the Privacy Act of 1974 that the following 
system of records be examined and that I be furnished with a copy of any 
record (or a specified record) contained therein pertaining to me. I 
agree that I will pay the fees ultimately determined to be due for 
duplication of such record. I have enclosed the necessary information.

System Name:
System Location:
Designated Official:

_______________________________________________________________________
                                                             John Doe   

        Request for Notification and Access to Records in Person

    I, John Doe, of 100 Main Street, Boston, MA 02108 (soc. sec. num. 
000-00-0000) request under the provisions of the Privacy Act of 1974, 
that the following system of records be examined and that I be granted 
access in person to inspect any record (or a specified record) contained 
therein pertaining to me. I have enclosed the necessary identification.

System Name:
System Location:
Designated Official:

_______________________________________________________________________
                                                            John Doe    

    (e) Processing a request for notification and access to records or a 
request for an accounting of disclosures. (i) If a request for 
notification and access (or request for an accounting of disclosures) 
omits any information which is essential to processing the request, the 
request will not be acted upon and the individual making the request 
will be promptly advised of the additional information which must be 
submitted before the request can be processed.
    (ii) Within 30 days (not including Saturdays, Sundays, and legal 
public holidays) after the receipt of a request for notification and 
access (or a request for an accounting of disclosures), to a particular 
system of records by the designated official for such system, a 
determination will be made as to whether the particular system of 
records is exempt from the notification and access provisions of the 
Privacy Act, and if such system is not exempt, whether it does or does 
not contain a record pertaining to the individual making the request. If 
a determination cannot be made within 30 days, the individual will be 
notified of the delay, the reasons therefor, and the approximate time 
required to make a determination. If it is determined by the designated 
official that the particular system of records is exempt from the 
notification and access provisions of the Privacy Act, the individual 
making the request will be notified of the provisions of the Privacy Act 
under which the exemption is claimed. On the other hand, if it is 
determined by the designated official that the particular system of 
records is not exempted from the notification and access provisions of 
the Privacy Act and that such system contains a record pertaining to the 
individual making the request, the individual will be notified of the 
time and place where inspection may be made. If an individual has not 
requested that access be granted to inspect the record in person, but 
merely requests that a copy of the record be furnished, or if it is 
determined by the designated official that the granting of access to 
inspect a record in person is not feasible in a particular case, then 
the designated official will furnish a copy of the record with the 
notification, or if a copy cannot be furnished at such time, a statement 
indicating the approximate time such copy will be furnished. If the 
request is for an accounting of disclosures from a system of records 
which is not exempt from the accounting of disclosure provisions of the 
Privacy Act, the individual will be furnished with an accounting of such 
disclosures.
    (f) Granting of access. Normally, an individual will be granted 
access to inspect a record in person within 30 days (excluding 
Saturdays, Sundays, and legal public holidays) after the receipt for a 
request for notification and access by the designated official. If 
access cannot be granted within 30 days, the notification will state the 
reasons for the delay and the approximate time such access will be 
granted. An individual wishing to inspect a record may be accompanied by 
another person of his choosing. Both the individual seeking access and 
the individual accompanying him may be required to sign a form supplied 
by the IRS indicating that the Service is authorized to disclose or 
discuss the contents of the record in the presence of both individuals. 
See 26 CFR 601.502 for requirements to be met by taxpayer's 
representatives in order to discuss the contents of any tax records.
    (g) Medical records. When access is requested to medical records 
(including psychological records), the designated official may determine 
that release of such records will be made only to a physician designated 
by the individual to have access to such records.
    (h) Verification of identity. An individual seeking notification or 
access to records, or seeking to amend a record, must satisfy one of the 
following identification requirements before action will be taken by the 
IRS on any such request:
    (i) An individual seeking notification or access to records in 
person, or seeking to amend a record in person, may establish

[[Page 105]]

identity by the presentation of a single document bearing a photograph 
(such as a passport or identification badge) or by the presentation of 
two items of identification which do not bear a photograph but do bear 
both a name and signature (such as a driver's license or credit card).
    (ii) An individual seeking notification or access to records by 
mail, or seeking to amend a record by mail, may establish identity by a 
signature, address, and one other identifier such as a photocopy of a 
driver's license or other document bearing the individual's signature.
    (iii) Notwithstanding subdivisions (i) and (ii) of this 
subparagraph, an individual seeking notification or access to records by 
mail or in person, or seeking to amend a record by mail or in person, 
who so desires, may establish identity by providing a notarized 
statement, swearing or affirming to such individual's identity and to 
the fact that the individual understands the penalties provided in 5 
U.S.C. 552a(i)(3) for requesting or obtaining access to records under 
false pretenses.
    (iv) Notwithstanding subdivisions (i), (ii), or (iii) of this 
subparagraph, a designated official may require additional proof of an 
individual's identity before action will be taken on any request if such 
official determines that it is necessary to protect unauthorized 
disclosure of information in a particular case. In addition, a parent of 
any minor or a legal guardian of any individual will be required to 
provide adequate proof of legal relationship before such person may act 
on behalf of such minor or such individual.
    (i) Fees. The fee for costs required of the IRS in copying records 
pursuant to this paragraph is $0.15 per page. However, no fee will be 
charged if the aggregate costs required of the IRS in copying records is 
less than $3.00. If an individual who has requested access to inspect a 
record in person is denied such access by the designated official 
because it would not be feasible in a particular case, copies of such 
record will be furnished to the individual without payment of the fees 
otherwise required under this subparagraph. If the IRS estimates that 
the total fees for costs incurred in complying with a request for copies 
of records will amount to $50 or more, the individual making the request 
may be required to enter into a contract for the payment of the actual 
fees with respect to the request before the Service will furnish the 
copies requested. Payment of fees for copies of records should be made 
by check or money order payable to the Internal Revenue Service.
    4. Procedures for amendment of records. (a) In general. This 
paragraph sets forth the procedures for reviewing a request from an 
individual concerning the amendment of any record or information 
pertaining to such individual, for making a determination on the 
request, for making an appeal within the IRS of an initial adverse 
determination, and for judicial review of a final determination.
    (b) Amendment of record. Under 5 U.S.C. 552a(d)(2), an individual 
who has been granted access to a record pertaining to such individual 
may, after inspecting the record, request that the record be amended to 
make any correction of any portion thereof which the individual believes 
is not accurate, relevant, timely, or complete. An individual may seek 
to amend a record in accordance with the rules provided in paragraph 
(d)(3) of this section. See paragraph (b) of this section for 
prohibition against amendment of tax records.
    (c) Form of request for amendment of record. (i) A request for 
amendment of a record shall be in writing and shall be signed by the 
individual making the request.
    (ii) Such request shall be clearly marked ``Request for amendment of 
record.''
    (iii) Such request shall contain a statement that it is being made 
under the provisions of the Privacy Act of 1974.
    (iv) Such request shall contain the name and address of the 
individual making the request. In addition, if a particular system 
employs an individual's social security number as an essential means of 
accessing the system, the request must include the individual's social 
security number. In the case of a record maintained in the name of two 
or more individuals (e.g., husband and wife), the request shall contain 
the names, addresses, and social security numbers (if necessary) of both 
individuals.
    (v) Such request shall specify the name and location of the system 
of records (as set forth in the Notice of Systems) in which such record 
is maintained, and the title and business address of the official 
designated in the access section for such system (as set forth in the 
Notice of Systems).
    (vi) Such request shall specify the particular record in the system 
which the individual is seeking to amend.
    (vii) Such request shall clearly state the specific changes which 
the individual wishes to make in the record and a concise explanation of 
the reasons for the changes. If the individual wishes to correct or add 
any information, the request shall contain specific language making the 
desired correction or addition.
    (d) Time and place for making request. A request to amend a record 
under the Privacy Act shall be addressed to or delivered in person to 
the office of the official designated in the access section for the 
particular system of records. The title and office address of such 
official is set forth for each system of records in the Notice of 
Systems of Records. A request delivered to an office in person must be 
delivered during the regular office hours of that office.

[[Page 106]]

    (e) Processing a request for amendment of a record. (i) Within 10 
days (not including Saturdays, Sundays, and legal public holidays) after 
the receipt of a request to amend a record by the designated official, 
the individual will be sent a written acknowledgement that will state 
that the request has been received, that action is being taken thereon, 
and that the individual will be notified within 30 days (not including 
Saturdays, Sundays, and legal public holidays) after the receipt of the 
request whether the requested amendments will or will not be made. If a 
request for amendment of a record omits any information which is 
essential to processing the request, the request will not be acted upon 
and the individual making the request will be promptly advised on the 
additional information which must be submitted before the request can be 
processed.
    (ii) Within 30 days (not including Saturdays, Sundays, and legal 
public holidays) after the receipt of a request to amend a record by the 
designated official, a determination will be made as to whether to grant 
the request in whole or part. The individual will then be notified in 
writing of the determination. If a determination cannot be made within 
30 days, the individual will be notified in writing within such time of 
the reasons for the delay and the approximate time required to make a 
determination. If it is determined by the designated official that the 
request will be granted, the requested changes will be made in the 
record and the individual will be notified of the changes. In addition, 
to the extent an accounting was maintained, all prior recipients of such 
record will be notified of the changes. Upon request, an individual will 
be furnished with a copy of the record, as amended, subject to the 
payment of the appropriate fees. On the other hand, if it is determined 
by the designated official that the request, or any portion thereof, 
will not be granted, the individual will be notified in writing of the 
adverse determination. The notification of an adverse determination will 
set forth the reasons for refusal to amend the record. In addition, the 
notification will contain a statement informing the individual of such 
individual's right to request an independent review of the adverse 
determination by a reviewing officer in the national office of the IRS 
and the procedures for requesting such a review.
    (f) Administrative review of adverse determination. Under 5 U.S.C. 
552a (d)(3), an individual who disagrees with the refusal of the agency 
to amend a record may, within 35 days of being notified of the adverse 
determination, request an independent review of such refusal by a 
reviewing officer in the national office of the IRS. The reviewing 
officer for the IRS is the Commission of Internal Revenue, the Deputy 
Commissioner, or an Assistant Commissioner. In the case of an adverse 
determination relating to a system of records maintained by the Office 
of General Counsel for the IRS, the reviewing officer is the Chief 
Counsel or his delegate. An individual seeking a review of an adverse 
determination shall make a request for review in accordance with the 
rules provided in paragraph (d)(7) of this section.
    (g) Form of request for review. (i) A request for review of an 
adverse determination shall be in writing and shall be signed by the 
individual making the request.
    (ii) Such request shall be clearly marked ``Request for review of 
adverse determination''.
    (iii) Such request shall contain a statement that it is being made 
under the provisions of the Privacy Act of 1974.
    (iv) Such request shall contain the name and address of the 
individual making the request. In addition, if a particular system 
employs an individual's social security number as an essential means of 
accessing the system, the request must include the individual's social 
security number. In the case of a record maintained in the name of two 
or more individuals (e.g. husband and wife), the request shall contain 
the names, addresses, and social security numbers (if necessary) of both 
individuals.
    (v) Such request shall specify the particular record which the 
individual is seeking to amend, the name and location of the system of 
records (as set forth in the Notice of Systems) in which such record is 
maintained, and the title and business address of the designated 
official for such system (as set forth in the Notice of Systems).
    (vi) Such request shall include the date of the initial request for 
amendment of the record, and the date of the letter notifying the 
individual of the initial adverse determination with respect to such 
request.
    (vii) such request shall clearly state the specific changes which 
the individual wishes to make in the record and a concise explanation of 
the reasons for the changes. If the individual wishes to correct or add 
any information, the request shall contain specific language making the 
desired correction or addition.
    (h) Time and place for making the request. A request for review of 
an adverse determination under the Privacy Act shall be addressed to or 
delivered in person to the Director, Office of Disclosure, Attention: 
OP:EX:D Internal Revenue Service, 1111 Constitution Avenue, NW, 
Washington, DC 20224. A request for review of an adverse determination 
will be promptly referred by the Director, Office of Disclosure to the 
appropriate reviewing officer for his review and final determination.
    (i) Processing a request for review of adverse determination. Within 
30 days (not including Saturdays, Sundays, and legal public holidays) 
after the receipt of a request for review

[[Page 107]]

of an adverse determination by the appropriate reviewing officer, the 
reviewing officer will review the initial adverse determination, make a 
final determination whether to grant the request to amend the record in 
whole or in part, and notify the individual in writing of the final 
determination. If a final determination cannot be made within 30 days, 
the Commissioner of Internal Revenue may extend such 30-day period. The 
individual will be notified in writing within the 30 day period of the 
cause for the delay and the approximate time required to make a final 
determination. If it is determined by the reviewing officer that the 
request to amend the record will be granted, the reviewing officer will 
cause the requested changes to be made and the individual will be so 
notified. Upon request, an individual will be furnished with a copy of 
the record as amended subject to the payment of appropriate fees. On the 
other hand, if it is determined by the reviewing officer that the 
request to amend the record, or any portion thereof, will not be 
granted, the individual will be notified in writing of the final adverse 
determination. The notification of a final adverse determination will 
set forth the reasons for the refusal of the reviewing officer to amend 
the record. The notification shall include a statement informing the 
individual of the right to submit a concise statement for insertion in 
the record setting forth the reasons for the disagreement with the 
refusal of the reviewing officer to amend the record. In addition, the 
notification will contain a statement informing the individual of the 
right to seek judicial review by a United States district court of a 
final adverse determination.
    (j) Statement of disagreement. Under 5 U.S.C. 552a (d)(3), an 
individual who disagrees with a final adverse determination not to amend 
a record subject to amendment under the Privacy Act may submit a concise 
statement for insertion in the record setting forth the reasons for 
disagreement with the refusal of the reviewing officer to amend the 
record. A statement of disagreement should be addressed to or delivered 
in person to the Director, Office of Disclosure, Attention: OP:EX:D, 
Internal Revenue Service, 1111 Constitution Avenue, NW, Washington, DC 
20224. The Director, Office of Disclosure will foward the statement of 
disagreement to the appropriate designated official who will cause the 
statement to be inserted in the individual's record. Any such statement 
will be available to anyone to whom the record is subsequently disclosed 
and the prior recipients of the record will be provided with a copy of 
the statement of disagreement, to the extent an accounting of 
disclosures was maintained.
    (k) Judicial review. If, after a review and final determination on a 
request to amend a record by the appropriate reviewing officer, the 
individual is notified that the request will not be granted, or if, 
after the expiration of 30 days (not including Sundays, Saturdays, and 
legal public holidays) from the receipt of such request by the Director, 
Disclosure Operations Division, action is not taken thereon in 
accordance with the requirements of paragraph (d)(9) of this section, an 
individual may commence an action within the time prescribed by law in a 
U.S. District Court pursuant to 5 U.S.C. 552a (g)(1). The statute 
authorizes an action only against the agency. With respect to records 
maintained by the IRS, the agency is the Internal Revenue Service, not 
an officer or employee thereof. Service of process in such an action 
shall be in accordance with the Federal Rules of Civil Procedure (28 
U.S.C. App.) applicable to actions against an agency of the United 
States. Where provided in such Rules, delivery of process upon the IRS 
must be directed to the Commissioner of Internal Revenue, Attention: 
CC:GLS, 1111 Constitution Avenue, NW, Washington, DC 20224. The district 
court will determine the matter de novo.
    5. Records transferred to Federal Records Centers. Records 
transferred to the Administrator of General Services for storage in a 
Federal Records Center are not used by the Internal Revenue Service in 
making any determination about any individual while stored at such 
location and therefore are not subject to the provisions of 5 U.S.C. 
552a (e)(5) during such time.

                Appendix C--United States Customs Service

    1. In general. This appendix applies to the United States Customs 
Service. It sets forth specific notification and access procedures with 
respect to particular systems of records, identifies the officer 
designated to make the initial determinations with respect to 
notification and access to records and accountings of disclosures of 
records. This appendix also sets forth the specific procedures for 
requesting amendment of records and identifies the officers designated 
to make the initial and appellate determinations with respect to 
requests for amendment of records. It identifies the officers designated 
to grant extensions of time on appeal, the officers with whom 
``Statements of Disagreement may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e) (4) and (11) and published 
annually by the Office of the Federal Register in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accounting of 
disclosures. (a) For records which are maintained at the United

[[Page 108]]

States Customs Service Headquarters, initial requests for notification 
and access to records and accountings of disclosures under 31 CFR 1.26, 
should be mailed or personally delivered to the Director, Office of 
Regulations & Rulings, U.S. Customs Service, 1301 Constitution Avenue 
NW., Washington, DC 20229. The official who has authority over the 
maintenance of the file will have the authority to grant or deny the 
request.
    (b) For records maintained at Regional Offices, initial requests for 
notification and access to records and accountings of disclosures under 
31 CFR 1.26, should be mailed or personally delivered to the Regional 
Commissioner of Customs in whose region the records are located. This 
official shall have the authority to grant the request or deny the 
request. The appropriate location of the regional offices is specified 
in Customs Appendix A in ``Privacy Act Issuances'' published annually by 
the Office of the Federal Register.
    (c) Each request shall comply with the identification and other 
requirements set forth in 31 CFR 1.26, and in the appropriate system 
notice in the ``Privacy Act Issuances'' published annually by the Office 
of the Federal Register. Each request should be conspicuously labeled on 
the face of the envelope ``Privacy Act Request''.
    3. Request for amendment of records. (a) For records which are 
maintained at Customs Service Headquarters, initial requests for 
amendment of records under 31 CFR 1.27 (a) through (d) should be mailed 
or personally delivered to the Director, Office of Regulations & 
Rulings, U.S. Customs Service, 1301 Constitution Avenue NW., Washington, 
DC 20229. The official who has authority over the maintenance of the 
file will have the authority to grant or deny the request.
    (b) For records not maintained at Customs Service Headquarters, 
initial requests for amendment of records under 31 CFR 1.27 (a) through 
(d) should be mailed or personally delivered to the Regional 
Commissioner of Customs in whose region the records are located. This 
official shall have the authority to grant or deny the request. A 
request directed to a Regional Commissioner should be mailed to or 
personally delivered at the appropriate location specified in Customs 
Appendix A in ``Privacy Act Issuances'' published annually by the Office 
of the Federal Register.
    (c) Each request shall comply with the identification and other 
requirements set forth in 31 CFR 1.27, and in the appropriate system 
notice in ``Privacy Act Issuance published by the Office of the Federal 
Register. Each request should be conspicuously labeled on the face of 
the envelope ``Privacy Act Amendment Request''.
    4. Administrative appeal of initial determination refusing to amend 
records. Appellate determinations (including extensions of time on 
appeal under 31 CFR 1.27 (e) with respect to all Customs Service records 
will be made by the Director, Office of Regulations & Rulings or the 
delegate of such official. All such appeals should be mailed or 
personally delivered to the United States Customs Service, Office of 
Regulations & Rulings, 1301 Constitution Avenue NW., Washington, DC 
20229. Each appeal should be conspicuously labeled on the face of the 
envelope ``Privacy Act Amendment Appeal''.
    5. Statements of disagreement. ``Statements of Disagreement'' 
pursuant to 31 CFR 1.27 (e)(4)(i) shall be filed with the official 
signing the notification of refusal to amend at the address indicated in 
the letter of notification within 35 days of the date of such 
notification and should be limited to one page.
    6. Service of process. Service of process will be received by the 
Chief Counsel, United States Customs Service, 1301 Constitution Avenue 
NW., Washington, DC 20229.
    7. Annual notice of systems of records. The annual notice of the 
United States Customs Service systems of records required to be 
published by the Office of the Federal Register, as specified in 5 
U.S.C. 552a(f), is included in the publication entitled ``Privacy Act 
Issuances''.
    8. Verification of identity. Each request shall comply with the 
identification and other requirements set forth in 31 CFR 1.26 and in 
the appropriate system notice published by the Office of the Federal 
Register. Each request should be conspicuously labeled on the face of 
the envelope ``Privacy Act Request''.

                Appendix D--United States Secret Service

    1. In general. This appendix applies to the United States Secret 
Service. It sets forth specific notification and access procedures with 
respect to particular systems of records including identification 
requirements, and time and places where records may be reviewed; 
identifies the officers designated to make the initial determinations 
with respect to notification and access to records and accountings of 
disclosures of records. This appendix also sets forth the specific 
procedures for requesting amendment of records and identifies the 
officers designated to make the initial and appellate determinations 
with respect to requests for amendment of records. It identifies the 
officers designated to grant extensions of time on appeal, the officers 
with whom ``Statements of Disagreement may be filed, the officer 
designated to receive service of process and the addresses for delivery 
of requests, appeals, and service of process. In addition, it references 
the notice of systems of records and notices of the routine uses of the 
information in the system required by 5 U.S.C. 552a(e) (4) and (11) and 
published annually by the Office of the Federal Register in ``Privacy 
Act Issuances''.

[[Page 109]]

    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the United States Secret Service, will be made by the 
Freedom of Information and Privacy Act Officer, United States Secret 
Service. Requests for notification should be made by mail or delivered 
personally between the hours of 9:00 a.m. and 5:30 of any day excluding 
Saturdays, Sundays, and legal holidays to: Privacy Act Request, Freedom 
of Information and Privacy Act Officer, United States Secret Service, 
Room 720, 1800 G Street NW., Washington, DC 20223.
    a. Identification requirements. In addition to the requirements 
specified in 31 CFR 1.26, each request for notification, access or 
amendment of records made by mail shall contain the requesting 
individual's date and place of birth and a duly notarized statement 
signed by the requester asserting his or her identity and stipulating 
that the requesting individual understands that knowingly or willfully 
seeking or obtaining access to records about another person under false 
pretences is punishable by a fine of up to $5,000.
    b. Individuals making requests in person. Individuals making 
requests in person will be required to exhibit acceptable identifying 
documents such as employee identification numbers, drivers licenses, 
medical cards or other documents sufficient to verify the identity of 
the requester.
    c. Physical inspection of records. Upon determining that a request 
for the physical inspection of records is to be granted, the requester 
shall be notified in writing of the determination, and when and where 
the requested records may be inspected. The inspection of records will 
be conducted at the Secret Service field office or other facility 
located nearest to the residence of the individual making the request. 
Such inspection shall be conducted during the regular business hours of 
the Secret Service Field Office or other facility where the disclosure 
is made. A person of his or her own choosing may accompany the 
individual making the request provided the individual furnishes a 
written statement authorizing the disclosure of that individual's record 
in the accompanying person's presence. Any disclosure of a record will 
be made in the presence of a representative of the United States Secret 
Service.
    3. Requests for amendment of records. Initial determination under 31 
CFR part 1, whether to grant requests to amend records will be made by 
the Freedom of Information and Privacy Act Officer. Requests should be 
mailed or delivered personally between the hours of 9:00 a.m. and 5:30 
p.m. to: Privacy Act Amendment Request, Freedom of Information and 
Privacy Acts Officer, United States Secret Service, Room 720, 1800 G 
Street NW., Washington, DC 20223.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27 including extensions of time on appeal, with 
respect to records of the United States Secret Service will be made by 
the Assistant Secretary of the Treasury for Enforcement. Appeals made by 
mail should be addressed to, or delivered personally to: Privacy Act 
Amendment Appeal, Assistant Secretary of the Treasury for Enforcement, 
Department of the Treasury, 1500 Pennsylvania Avenue NW., Washington, DC 
20220.
    5. Statements of disagreement. ``Statements of Disagreements'' under 
31 CFR 1.27 (e)(4)(i) shall be filed with the official signing of the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
United States Secret Service General Counsel and shall be delivered to 
the following location: General Counsel, United States Secret Service, 
Room 843, 1800 G Street NW., Washington, DC 20223.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

           Appendix E--Bureau of Alcohol, Tobacco and Firearms

    1. In general. This appendix applies to the Bureau of Alcohol, 
Tobacco and Firearms. It sets forth specific notification and access 
procedures with respect to particular systems of records, identifies the 
officers designated to make the initial determinations with respect to 
notification and access to records and accountings of disclosures of 
records. This appendix also sets forth the specific procedures for 
requesting amendment of records and identifies the officers designated 
to make the initial and appellate determinations with respect to 
requests for amendment of records. It identifies the officers designated 
to grant extensions of time on appeal, the officers with whom 
``Statements of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a (3) (4) and (11) and published 
annually by

[[Page 110]]

the Office of the Federal Register in ``Privacy Act Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determination under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Bureau of Alcohol, Tobacco, and Firearms, will be 
made by the Chief, Disclosure Branch, Office of the Assistant to the 
Director or the delegate of such officer. Requests may be mailed or 
delivered in person to: Privacy Act Request, Chief, Disclosure Branch, 
Room 4406, Bureau of Alcohol, Tobacco and Firearms, 1200 Pennsylvania 
Avenue, NW., Washington, DC 20226.
    3. Requests for amendment of record. Initial determinations under 31 
CFR 1.27 (a) through (d) with respect to requests to amend records 
maintained by the Bureau of Alcohol, Tobacco and Firearms will be made 
by the Chief, Disclosure Branch, Office of the Assistant to the 
Director. Requests for amendment of records may be mailed or delivered 
in person to: Privacy Act Request, Chief, Disclosure Branch, Room 4406, 
Bureau of Alcohol, Tobacco and Firearms, 1200 Pennsylvania Avenue, NW., 
Washington, DC 20226.
    4. Verification of identity. (a) In addition to the requirements 
specified in 31 CFR 1.26(d) of this appendix, each request for 
notification, access or amendment of records made by mail shall contain 
the requesting individual's date and place of birth and a statement 
signed by the requester asserting his or her identity and stipulating 
that the requester understands that knowingly or willfully seeking or 
obtaining access to records about another person under false pretenses 
is a misdemeanor and punishable by a fine of up to $5,000 provided, that 
the Bureau of Alcohol, Tobacco and Firearms may require a signed 
notarized statement verifying the identity of the requester.
    (b) Individuals making requests in person will be required to 
exhibit at least two acceptable identifying documents such as employee 
identification cards, driver's license, medical cards, or other 
documents sufficient to verify the identity of the requester.
    (c) The parent or guardian of a minor or a person judicially 
determined to be incompetent, shall in addition to establishing the 
identity of the minor or other person he represents as required in (a) 
and (b), establish his own parentage or guardianship by furnishing a 
copy of a birth certificate showing parentage (or other satisfactory 
documentation) or a court order establishing the guardianship.
    5. Request for physical inspection of records. Upon determining that 
a request for the physical inspection of records is to be granted, the 
requester shall be notified in writing of the determination, and when 
and where the records may be inspected. The inspection of records will 
be made at the Bureau of Alcohol, Tobacco and Firearms Field Office or 
other facility located nearest to the residence of the individual making 
the request. Such inspection shall be conducted during the regular 
business hours of the field office or other facility where the 
disclosure is made. A person of the requester's own choosing may 
accompany the requester provided the requester furnishes a written 
statement authorizing the disclosure of the requester's record in the 
accompanying person's presence. The record inspection will be made in 
the presence of a representative of the Bureau. Following the inspection 
of the record, the individual will acknowledge in writing the fact that 
he or she had an opportunity to inspect the requested record.
    6. Requests for copies of records without prior physical inspection. 
Upon determining that an individual's request for copies of his or her 
records without prior physical inspection is to be granted, the 
requester shall be notified in writing of the determination, and the 
location and time for his or her receipt of the requested copies. The 
copies will be made available at the Bureau of Alcohol, Tobacco and 
Firearms field office or other facility located nearest to the residence 
of the individual making the request. Copies shall be received by the 
requester during the regular business hours of the field office or other 
facility where the disclosure is made. Transfer of the copies to the 
individual shall be conditioned upon payment of copying costs and his 
presentation of at least two acceptable identifying documents such as 
employee identification cards, driver's license, medical cards, or other 
documents sufficient to verify the identity of the requester. Following 
the receipt of the copies, the individual will acknowledge receipt in 
writing.
    7. Administrative appeal of initial determination refusing to amend 
record. Appellate determinations under 31 CFR 1.27(e) with respect to 
records of the Bureau of Alcohol, Tobacco and Firearms, including 
extensions of time on appeal, will be made by the Director or the 
delegate of such officer. Appeals should be addressed to, or delivered 
in person to: Privacy Act Amendment Appeal, Director, Bureau of Alcohol, 
Tobacco and Firearms, Room 4406, 1200 Pennsylvania Avenue, NW., 
Washington, DC 20226.
    8. Statements of disagreement. ``Statements of Disagreement'' as 
described in 31 CFR 1.27(e) (4) shall be filed with the official signing 
the notification within 35 days of the date of such notification and 
should be limited to one page.
    9. Service of process. Service of process will be received by the 
Director of the Bureau of Alcohol, Tobacco and Firearms or the delegate 
of such official and shall be delivered to the following location: 
Director, Bureau of Alcohol, Tobacco and Firearms, 1200 Pennsylvania 
Avenue, NW., Washington, DC 20226, Attention: Chief Counsel.

[[Page 111]]

    10. Annual notice of systems of records. The annual notice of 
systems of records is published by the Office of the Federal Register, 
as specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy 
Act Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for each pertinent 
system.

              Appendix F--Bureau of Engraving and Printing

    1. In general. This appendix applies to the Bureau of Engraving and 
Printing. It sets forth specific notification and access procedures with 
respect to particular systems of records including identification 
requirements, identifies the officers designated to make the initial 
determinations with respect to notification and access to records and 
accountings of disclosures of records. This appendix also sets forth the 
specific procedures for requesting amendment of records and identifies 
the officers designated to make the initial and appellate determinations 
with respect to requests for amendment of records. It identifies the 
officers designated to grant extensions of time on appeal, the officers 
with whom ``Statements of Disagreement may be filed, the officer 
designated to receive service of process and the addresses for delivery 
of requests, appeals, and service of process. In addition, it references 
the notice of systems of records and notices of the routine uses of the 
information in the system required by 5 U.S.C. 552a (e) (4) and (11) and 
published annually by the Office of the Federal Register in ``Privacy 
Act Issuances.''
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Bureau of Engraving and Printing, will be made by 
the head of the organizational unit having immediate custody of the 
records requested, or the delegate of such official. Requests for access 
to records contained within a particular system of records should be 
submitted to the address indicated for that system in the access section 
of the notices published by the Office of the Federal Register in 
``Privacy Act Issuances.'' Requests for information and specific 
guidance should be addressed to: Privacy Act Request, Disclosure Officer 
(Executive Assistant to the Director), Room 104--18M, Bureau of 
Engraving and Printing, Washington, DC 20228.
    3. Requests for amendment of records. Initial determination under 31 
CFR 1.27 (a) through (d), whether to grant request to amend records will 
be made by the head of the organizational unit having immediate custody 
of the records or the delegate of such official. Requests for amendment 
should be addressed as indicated in the appropriate system notice in 
``Privacy Act Issuances'' published by the Office of the Federal 
Register. Requests for information and specific guidance on where to 
send requests for amendment should be addressed to: Privacy Act 
Amendment Request, Disclosure Officer (Executive Assistant to the 
Director), Bureau of Engraving and Printing, Room 104-18M, Washington, 
DC 20228.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27(e) including extensions of time on appeal, 
with respect to records of the Bureau of Engraving and Printing will be 
made by the Director of the Bureau or the delegate of such officer. 
Appeals made by mail should be addressed to, or delivered personally to: 
Privacy Act Amendment Appeal, Disclosure Officer (Executive Assistant to 
the Director), Room 104-18M, Bureau of Engraving and Printing, 
Washington, DC 20228.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27(e)(4)(8) shall be filed with the official signing the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
Chief Counsel of the Bureau of Engraving and Printing and shall be 
delivered to the following location: Chief Counsel, Bureau of Engraving 
and Printing, Room 109-M, 14th and C Streets, SW., Washington, DC 20228.
    7. Verification of identity. An individual seeking notification or 
access to records, or seeking to amend a record, or seeking an 
accounting of disclosures, must satisfy one of the following 
identification requirements before action will be taken by the Bureau of 
Engraving and Printing on any such request:
    (i) An individual appearing in person may establish identity by the 
presentation of a single document bearing a photograph (such as a 
passport or identification badge) or by the presentation of two items of 
identification which do not bear a photograph, but do bear both a name 
and signature (such as a credit card).
    (ii) An individual may establish identity through the mail by a 
signature, address, and one other identifier such as a photocopy of a 
driver's license or other document bearing the individual's signature.
    (iii) Notwithstanding subdivisions (i) and (ii) of this 
subparagraph, an individual who so desires, may establish identity by 
providing a notarized statement, swearing or affirming to such 
individual's identity and to the fact that the individual understands 
the penalties provided in 5 U.S.C. 552a(1)(3) for

[[Page 112]]

requesting or obtaining access to records under false pretenses.
    Notwithstanding subdivision (i), (ii), or (iii) of this 
subparagraph, the Executive Assistant or other designated official may 
require additional proof of an individual's identity before action will 
be taken on any request if such official determines that it is necessary 
to protect against unauthorized disclosure of information in a 
particular case. In addition, a parent of any minor or a legal guardian 
of any individual will be required to provide adequate proof of legal 
relationship before such person may act on behalf of such minor or such 
individual.
    8. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 522a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

                Appendix G--Financial Management Service

    1. In general. This appendix applies to the Financial Management 
Service. It sets forth specific notification and access procedures with 
respect to particular systems of records, identifies the officers 
designated to make the initial determinations with respect to 
notification and access to records and accountings of disclosures of 
records. This appendix also sets forth the specific procedures for 
requesting amendment of records and identifies the officers designated 
to make the initial and appellate determinations with respect to 
requests for amendment of records. It identifies the officers designated 
to grant extensions of time on appeal, the officers with whom 
``Statements of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e) (4) and (11) and published 
annually by the Office of the Federal Register in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Financial Management Service, will be made by the 
head of the organizational unit having immediate custody of the records 
requested or an official designated by this official. This is indicated 
in the appropriate system notice in ``Privacy Act Issuances'' published 
annually by the Office of the Federal Register. Requests for information 
and specific guidance on where to send requests for records may be 
mailed or delivered personally to: Privacy Act Request, Disclosure 
Officer, Financial Management Service, Room 108, Treasury Department 
Annex No. 1, Pennsylvania Avenue and Madison Place, NW., Washington, DC 
20226.
    3. Requests for amendment of records. Initial determination under 31 
CFR 1.27(a) through (d), whether to grant requests to amend records will 
be made by the head of the organzational unit having immediate custody 
of the records or the delegate of such official. Requests for amendment 
should be addressed as indicated in the appropriate system notice in 
``Privacy Act Issuances'' published by the Office of the Federal 
Register. Requests for information and specific guidance on where to 
send requests for amendment should be addressed to: Privacy Act 
Amendment Request, Disclosure Officer, Financial Management Service, 
Department of the Treasury, Treasury Annex No. 1, Washington, DC 20226.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27(e) incuding extensions of time on appeal, with 
respect to records of the Financial Management Service will be made by 
the Commissioner or the delegate of such official. Appeals made by mail 
should be addressed to, or delivered personally to: Privacy Act 
Amendment Appeal Commissioner, Financial Management Service (Privacy), 
Department of the Treasury, Room 618, Treasury Annex No. 1, Pennsylvania 
Avenue and Madison Place, NW., Washington, DC 20226.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27(e)(4)(i) shall be filed with the official signing the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
Commissioner, Financial Management Service or the delegate of such 
official and shall be delivered to the following location: Commissioner, 
Financial Management Service (Privacy), Department of the Treasury, Room 
618, Treasury Annex No. 1, Pennsylvania Avenue and Madison Place, NW, 
Washington, DC 20226.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

[[Page 113]]

                     Appendix H--United States Mint

    1. In general. This appendix applies to the United States Mint. It 
sets forth specific notification and access procedures with respect to 
particluar systems of records, identifies the officers designated to 
make the initial determinations with respect to notification and access 
to records and accountings of disclosures of records. This appendix also 
sets forth the specific procedures for requesting amendment of records 
and identifies the officers designated to make the initial and appellate 
determinations with respect to requests for amendment of records. It 
identifies the officers designated to grant extensions of time on 
appeal, the officers with whom ``Statements of Disagreement'' may be 
filed, the officer designated to receive service of process and the 
addresses for delivery of requests, appeals, and service of process. In 
addition, it references the notice of systems of records and notices of 
the routine uses of the information in the system required by 5 U.S.C. 
552a(e) (4) and (11) and published annually by the Office of the Federal 
Register in ``Privacy Act Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the United States Mint will be made by the head of the 
organizational unit having immediate custody of the records requested or 
an official designated by this official. This is indicated in the 
appropriate system notice in ``Privacy Act Issuances'' published 
annually by the Office of the Federal Register. Requests should be 
directed to the Superintendent or Officer in charge of the facility in 
which the records are located or to the Chief, Administrative Programs 
Division. Requests for information and specific guidance on where to 
send requests for records may be mailed or delivered personally to: 
Privacy Act Request, Chief, Administrative Programs Division, United 
States Mint, Judiciary Square Building, 633 3rd Street, N.W, Washington, 
DC 20220.
    3. Requests for amendment of records. Initial determination under 31 
CFR 1.27 (a) through (d), whether to grant requests to amend records 
will be made by the head of the Mint installation having immediate 
custody of the records or the delegated official. Requests should be 
mailed or delivered personally to: Privacy Act Amendment Request, 
Freedom of Information and Privacy Acts Officer, United States Mint, 
Judiciary Square Building, 633 3rd Street, Washington, DC 20220.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27 including extensions of time on appeal, with 
respect to records of the United States Mint will be made by the 
Director of the Mint or the delegate of the Director. Appeals made by 
mail should be addressed to, or delivered personally to: Privacy Act 
Amendment Appeal, United States Mint, Judiciary Square Building, 633 3rd 
Street, NW, Washington, DC 20220.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27 (e)(4)(i) shall be filed with the official signing the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
Director of the Mint and shall be delivered to the following location: 
Director of the Mint, Judiciary Square Building, 633 3rd street, NW., 
Washington, DC 20220.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

                  Appendix I--Bureau of the Public Debt

    1. In general. This appendix applies to the Bureau of the Public 
Debt. It sets forth specific notification and access procedures with 
respect to particular systems of records, identifies the officers 
designated to make the initial determinations with respect to 
notification and access to records and accountings of disclosures of 
records. This appendix also sets forth the specific procedures for 
requesting amendment of records and identifies the officers designated 
to make the initial and appellate determinations with respect to 
requests for amendment of records. It identifies the officer designated 
to grant extension of time on appeal, the officers with whom 
``Statements of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e) (4) and (11) and published 
annually by the Office of the Federal Register in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26, whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Bureau of Public Debt, will be made by the head of 
the organizational unit having

[[Page 114]]

immediate custody of the records requested or an official designated by 
this official. This is indicated in the appropriate system notice in 
``Privacy Act Issuances'' published annually by the Office of the 
Federal Register. Requests for information and specific guidance on 
where to send requests for records may be mailed or delivered personnaly 
to: Privacy Act Request, Information Officer, Bureau of the Public Debt, 
Department of the Treasury, 999 E Street NW. Room 553, Washington, DC 
20239.
    3. Requests for amendment of records. Initial determination under 31 
CFR 1.27 (a) through (d), whether to grant requests to amend records 
will be made by the head of the organizational unit having immediate 
custody of the records or the delegate of such official. Requests for 
amendment should be addressed as indicated in the appropriate system 
notice in ``Privacy Act Issuances'' published by the Office of the 
Federal Register. Requests for information and specific guidance on 
where to send requests for amendment should be addressed to: Privacy Act 
Amendment Request, Information Officer, Bureau of the Public Debt, 
Department of the Treasury, 999 E Street NW., Room 553, Washington, DC 
20239.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27(e) including extensions of time on appeal, 
with respect to records of the Bureau of the Public Debt will be made by 
the Commissioner of the Public Debt or the delegate of such officer. 
Appeals made by mail should be addressed to, or delivered personally to: 
Privacy Act Amendment Appeal, Chief Counsel, Bureau of the Public Debt, 
Department of the Treasury, 999 E Street NW., Room 503, Washington, DC 
20239.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27 (e)(4)(i) shall be filed with the official signing the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
Chief Counsel of the Bureau of the Public Debt and shall be delivered to 
the following location: Chief Counsel, Bureau of the Public Debt, 
Department of the Treasury, 999 E Street, NW., Room 503, Washington, DC 
20239.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

          Appendix J--Office of the Comptroller of the Currency

    1. In general. This appendix applies to the Office of the 
Comptroller of the Currency. It sets forth specific notification and 
access procedures with respect to particular systems of records, 
identifies the officers designated to make the initial determinations 
with respect to notification and access to records and accountings of 
disclosures of records. This appendix also sets forth the specific 
procedures for requesting amendment of records and identifies the 
officers designated to make the intial and appellate determinations with 
respect to requests for amendment of records. It identifies the officers 
designated to grant extensions of time on appeal, the officers with whom 
``Statements of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e) (4) and (11) and published 
annually by the Office of the Federal Register in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accountings 
of disclosures. Initial determinations under 31 CFR 1.26 whether to 
grant requests for notification and access to records and accountings of 
disclosures for the Office of the Comptroller of the Currency will be 
made by the head of the organizational unit having immediate custody of 
the records requested or the delegate of that official. This is 
indicated in the appropriate system notice in ``Privacy Act Issuances'' 
published biennially by the Office of the Federal Register. Requests for 
information and specific guidance on where to send requests for records 
shall be mailed or delivered personally to: Disclosure Officer, 
Communications Division, Office of the Comptroller of the Currency, 250 
E Street, SW, Washington, DC 20219.
    3. Requests for amendment of records. Initial determinations under 
31 CFR 1.27 (a) through (d) whether to grant requests to amend records 
will be made by the Comptroller's delegate or the head of the 
organizational unit having immediate custody of the records or the 
delegate of that official. Requests for amendment shall be mailed or 
delivered personally to: Disclosure Officer, Communications Division, 
Office of the Comptroller of the Currency, 250 E Street, SW., 
Washington, DC 20219.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27(e) including extensions of time on appeal, 
with respect to records of the Office of the Comptroller of

[[Page 115]]

the Currency will be made by the Comptroller of the Currency or the 
Comptroller's delegate. Appeals shall be mailed or delivered personally 
to: Disclosure Officer, Communications Division, Office of the 
Comptroller of the Currency, 250 E Street, SW., Washington, DC 20219.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27(e)(4)(i) shall be filed with the OCC's Director of 
Communications at the address indicated in the letter of notification 
within 35 days of the date of such notification and should be limited to 
one page.
    6. Service of process. Service of process shall be delivered to the 
Chief Counsel or the Chief Counsel's delegate at the following location: 
Office of the Comptroller of the Currency, 250 E Street, SW., 
Washington, DC 20219.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26 and 1.27 are indicated in the notice for the pertinent 
system.

[52 FR 26305, July 14, 1987, as amended at 60 FR 57333, Nov. 15, 1995]

           Appendix L--Federal Law Enforcement Training Center

    1. In general. This appendix applies to the Federal Law Enforcement 
Training Center. It sets forth specific notification and access 
procedures with respect to particular systems of records, identifies the 
officers designated to make the initial determinations with respect to 
notification and access to records and accountings of disclosure of 
records. This appendix also sets forth the specific procedures for 
requesting amendment of records and identifies the officers designated 
to make the initial and appellate determinations with respect to 
requests for amendment of records. It identifies the officers designated 
to grant extensions of time on appeal, the officers with whom 
``Statements of Disagreement'' may be filed, the officer designated to 
receive service of process and the addresses for delivery of requests, 
appeals, and service of process. In addition, it references the notice 
of systems of records and notices of the routine uses of the information 
in the system required by 5 U.S.C. 552a(e) (4) and (11) and published 
annually by the Office of the Federal Register, in ``Privacy Act 
Issuances''.
    2. Requests for notification and access to records and accounting of 
disclosures. Initial determinations under 31 CFR 1.26, whether to grant 
requests for notification and acesss to records and accounting of 
disclosures for the Federal Law Enforcement Training Center, will be 
made by the head of the organizational unit having immediate custody of 
the records requested or an official designated by this official. This 
is indicated in the appropriate system notice in ``Privacy Act 
Issuances'' published annually by the Office of the Federal Register. 
Requests for information and specific guidance on where to send requests 
for records may be mailed or delivered personally to: Privacy Act 
Request, Library Building 262, Federal Law Enforcement Training Center, 
Glynco, Georgia 31524.
    3. Requests for amendment of records. Initial determinations under 
31 CFR 1.27 (a) through (d), whether to grant requests to amend records 
will be made by the head of the organizational unit having immediate 
custody of the records or the delegate of such official. Requests for 
amendment should be addressed as indicated in the appropriate system 
notice in ``Privacy Act Issuances'' published by the Office of the 
Federal Register. Requests for information and specific guidance on 
where to send requests for amendment should be addressed to: Privacy Act 
Amendment Request, Federal Law Enforcement Training Center, Glynco, 
Georgia 31524.
    4. Administrative appeal of initial determinations refusing 
amendment of records. Appellate determinations refusing amendment of 
records under 31 CFR 1.27(e) including extensions of time on appeal, 
with respect to records of the Federal Law Enforcement Training Center 
will be made by the Assistant Secretary (Enforcement), Department of the 
Treasury or the delegate of such officer. Appeals made by mail should be 
addressed to, or delivered personally to: Privacy Act Amendment Appeal, 
FLETC, Assistant Secretary (Enforcement), Department of the Treasury, 
1500 Pennsylvania Avenue, NW., Room 4312, Washington, DC 20220.
    5. Statements of disagreement. ``Statements of Disagreement'' under 
31 CFR 1.27(e)(4)(i) shall be filed with the official signing the 
notification of refusal to amend at the address indicated in the letter 
of notification within 35 days of the date of such notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
General Counsel of the Department of the Treasury or the delegate of 
such official and shall be delivered to the following location: General 
Counsel, Department of the Treasury, Room 3000, Main Treasury Building, 
1500 Pennsylvania Avenue, NW., Washington, DC 20220.
    7. Annual notice of systems of records. The annual notice of systems 
of records is published by the Office of the Federal Register, as 
specified in 5 U.S.C. 552a(f). The publication is entitled ``Privacy Act 
Issuances''. Any specific requirements for access, including 
identification requirements, in addition to the requirements set forth 
in 31 CFR 1.26

[[Page 116]]

and 1.27 are indicated in the notice for the pertinent system.

[52 FR 26305, July 14, 1987. Redesignated at 65 FR 2334, Jan. 14, 2000]

                Appendix M--Office of Thrift Supervision

    1. In general. This appendix applies to the Office of Thrift 
Supervision. It sets forth specific notification and access procedures 
with respect to particular systems of records, and identifies the 
officers designated to make the initial determinations with respect to 
notification and access to records, the officers designated to make the 
initial and appellate determinations with respect to requests for 
amendment of records, the officers designated to grant extensions of 
time on appeal, the officers with whom ``Statement of Disagreement'' may 
be filed, the officer designated to receive services of process and the 
addresses for delivery of requests, appeals, and service of process. In 
addition, it references the notice of systems of records and notices of 
the routine uses of the information in the system required by 5 U.S.C. 
552a(e) (4) and (11) and published biennially by the Office of the 
Federal Register in ``Privacy Act Issuances.''
    2. Requests for notification and access to records and accounting of 
disclosures. Initial determinations under 31 CFR 1.26, whether to grant 
requests for notification and access to records and accountings of 
disclosures for the Office of Thrift Supervision, will be made by the 
head of the organizational unit having immediate custody of the records 
requested, or the delegate of such official. This information is 
contained in the appropriate system notice in the ``Privacy Act 
Issuances,'' published biennially by the Office of the Federal Register. 
Requests for information and specific guidance on where to send requests 
for records should be addressed to: Privacy Act Request, Chief, 
Disclosure Branch, Information Services Division, Office of Thrift 
Supervision, 1700 G Street, NW., Washington, DC 20552.
    Requests may be delivered in person to: Office of Thrift 
Supervision, Information Services Division, 1700 G Street, NW., 
Washington, DC.
    3. Requests for amendments of records. Initial determinations under 
31 CFR 1.27 (a) through (d) with respect to requests to amend records 
maintained by the Office of Thrift Supervision will be made by the head 
of the organization or unit having immediate custody of the records or 
the delegates of such official. Requests for amendment of records should 
be addressed as indicated in the appropriate system notice in ``Privacy 
Act Issuances'' published by the Office of the Federal Register. 
Requests for information and specific guidance on where to send these 
requests should be addressed to: Privacy Act Amendment Request, Chief, 
Disclosure Branch, Information Services Division, Office of Thrift 
Supervision, 1700 G Street, NW., Washington, DC 20552.
    Privacy Act Amendment Requests may be delivered in person to: Office 
of Thrift Supervision, Information Services Division, 1700 G Street, 
NW., Washington, DC.
    4. Administrative appeal of initial determination refusing to amend 
record. Appellate determination under 31 CFR 1.27(e) with respect to 
records of the Office of Thrift Supervision, including extensions of 
time on appeal, will be made by the Director, Public Affairs, Office of 
Thrift Supervision, or the delegate of such official, as limited by 5 
U.S.C. 552a(d) (2) and (3). Appeals made by mail should be addressed as 
indicated in the letter of initial decision or to: Privacy Act Amendment 
Request, Chief, Disclosure Branch, Information Services Division, Office 
of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552.
    Appeals may be delivered in person to: Office of Thrift Supervision, 
Information Services Division, 1700 G Street, NW., Washington, DC.
    5. Statements of Disagreement. ``Statements of Disagreement'' as 
described in 31 CFR 1.27(e)(4) shall be filed with the official signing 
the notification of refusal to amend at the address indicated in the 
letter of notification within 35 days of the date of notification and 
should be limited to one page.
    6. Service of process. Service of process will be received by the 
Corporate Secretary of the Office of Thrift Supervision or the delegate 
of such official and shall be delivered to the following location: 
Corporate Secretary, Office of Thrift Supervision, 1700 G Street, NW., 
Washington, DC 20552.
    7. Annual notice of systems of record. The annual notice of systems 
of records required to be published by the Office of the Federal 
Register is included in the publication entitled ``Privacy Act 
Issuances,'' as specified in 5 U.S.C. 552a(f). Any specific requirements 
for access, including identification requirements, in addition to the 
requirements set forth in 31 CFR 1.26 and 1.27 and (8) below, and 
locations for access are indicated in the notice for the pertinent 
system.
    8. Verification of identity. An individual seeking notification or 
access to records, or seeking to amend a record, must satisfy one of the 
following identification requirements before action will be taken by the 
Office of Thrift Supervision on any such request:
    (i) An individual seeking notification or access to records in 
person, or seeking to amend a record in person, may establish identity 
by the presentation of a single official document bearing a photograph 
(such as a passport or identification badge) or by the presentation of 
two items of identification which do not bear a photograph but do bear

[[Page 117]]

both a name and signature (such as a driver's license or credit card).
    (ii) An individual seeking notification or access to records by 
mail, or seeking to amend a record by mail, may establish identity by a 
signature, address, and one other identifier such as a photocopy of a 
driver's license or other official document bearing the individual's 
signature.
    (iii) Notwithstanding subdivisions (i) and (ii) of this 
subparagraph, an individual seeking notification or access to records by 
mail or in person, or seeking to amend a record by mail or in person, 
who so desires, may establish identity by providing a notarized 
statement, swearing or affirming to such individual's identity and to 
the fact that the individual understands the penalties provided in 5 
U.S.C. 552a(i)(3) for requesting or obtaining access to records under 
false pretenses. Alternatively, an individual may provide a statement 
that the individual understands the penalties provided in 5 U.S.C. 
552a(i)(3) for requesting or obtaining access to records under false 
pretenses which is subscribed by the individual as true and correct 
under penalty of perjury pursuant to 28 U.S.C. 1746. Notwithstanding 
subdivision (i), (ii), or (iii) of this subparagraph, a designated 
official may require additional proof of an individual's identity before 
action will be taken on any request, if such official determines that it 
is necessary to protect against unauthorized disclosure of information 
in a particular case. In addition, a parent of any minor or a legal 
guardian of any individual will be required to provide adequate proof of 
legal relationship before such person may act on behalf of such minor or 
such individual.

[60 FR 31633, June 16, 1995. Redesignated at 65 FR 2334, Jan. 14, 2000]



PART 2--NATIONAL SECURITY INFORMATION--Table of Contents




                   Subpart A--Original Classification

Sec.
2.1  Classification levels [1.1(a)].
2.2  Classification Authority.
2.3  Listing of original classification authorities.
2.4  Record requirements.
2.5  Classification categories.
2.6  Duration of classification.
2.7  Identification and markings [1.5(a), (b) (c)].
2.8  Limitations on classification [1.6(c)].

                  Subpart B--Derivative Classification

2.9  Derivative Classification Authority.
2.10  Listing derivative classification authorities.
2.11  Use of derivative classification [2.1].
2.12  Classification guides.
2.13  Derivative identification and markings [1.5(c) and 2.1(b)].

               Subpart C--Downgrading and Declassification

2.14  Listing downgrading and declassification authorities [3.1(b)].
2.15  Declassification policy [3.1].
2.16  Downgrading and declassification markings.
2.17  Systematic review for declassification [3.3].
2.18  Mandatory declassification review [3.4].
2.19  Assistance to the Department of State [3.3(b)].
2.20  Freedom of Information/Privacy Act requests [3.4].

                         Subpart D--Safeguarding

2.21  General [4.1].
2.22  General restrictions on access [4.1].
2.23  Access by historical researchers and former presidential 
          appointees [4.3].
2.24  Dissemination [4.1(d)].
2.25  Standards for security equipment [4.1(b) and 5.1(b)].
2.26  Accountability procedures [4.1(b)].
2.27  Storage [4.1(b)].
2.28  Transmittal [4.1(b)].
2.29  Telecommunications and computer transmissions.
2.30  Special access programs [1.2(a) and 4.2(a)].
2.31  Reproduction controls [4.1(b)].
2.32  Loss or possible compromise [4.1(b)].
2.33  Responsibilities of holders [4.1(b)].
2.34  Inspections [4.1(b)].
2.35  Security violations.
2.36  Disposition and destruction [4.1(b)].
2.37  National Security Decision Directive 197.

                  Subpart E--Implementation and Review

2.38  Departmental management.
2.39  Bureau administration.
2.40  Emergency planning [4.1(b)].
2.41  Emergency authority [4.1(b)].
2.42  Security education [5.3(a)].

                      Subpart F--General Provisions

2.43  Definitions [6.1].

    Authority: 31 U.S.C. 321; E.O. 12958, 60 FR 19825, 3 CFR, 1995 
Comp., p. 333.

    Source: 55 FR 1644, Jan. 17, 1990, unless otherwise noted.

[[Page 118]]



                   Subpart A--Original Classification



Sec. 2.1  Classification levels [1.1(a)].\1\
---------------------------------------------------------------------------

    \1\ Related references are related to sections of Executive Order 
12356, 47 FR 14874, April 6, 1982.
---------------------------------------------------------------------------

    (a) National security information (hereinafter also referred to as 
``classified information'') shall be classified at one of the following 
three levels:
    (1) Top Secret shall be applied to information, the unauthorized 
disclosure of which reasonably could be expected to cause exceptionally 
grave damage to the national security.
    (2) Secret shall be applied to information, the unauthorized 
disclosure of which reasonably could be expected to cause serious damage 
to the national security.
    (3) Confidential shall be applied to information, the unauthorized 
disclosure of which reasonably could be expected to cause damage to the 
national security.
    (b) Limitations [1.1(b)]. Markings other than ``Top Secret,'' 
``Secret,'' and ``Confidential,'' shall not be used to identify national 
security information. No other terms or phrases are to be used in 
conjunction with these markings to identify national security 
information, such as ``Secret/Sensitive'' or ``Agency Confidential''. 
The terms ``Top Secret,'' ``Secret,'' and ``Confidential'' are not to be 
used to identify non-classified Executive Branch information. The 
administrative control legend, ``Limited Official Use'', is authorized 
in Treasury Directive 71-02, ``Safeguarding Officially Limited 
Information,'' which requires that information so marked is to be 
handled, safeguarded and stored in a manner equivalent to national 
security information classified Confidential.
    (c) Reasonable Doubt [1.1(c)]. When there is reasonable doubt about 
the need to classify information, the information shall be safeguarded 
as if it were ``Confidential'' information in accordance with subpart D 
of this regulation, pending a determination about its classification. 
Upon a final determination of a need for classification, the information 
that is classified shall be marked as provided in Sec. 2.7. When there 
is reasonable doubt about the appropriate classification level, the 
information shall be safeguarded at the higher level in accordance with 
subpart D, pending a determination of its classification level. Upon a 
final determination of its classification level, the information shall 
be marked as provided in Sec. 2.7.



Sec. 2.2  Classification Authority.

    Designations of original classification authority for national 
security information are contained in Treasury Order (TO) 102-19 (or 
successor order), which is published in the Federal Register. The 
authority to classify inheres within the office and may be exercised by 
a person acting in that capacity. There may be additional redelegations 
of original classification authority made pursuant to TO 102-19 (or 
successor order). Officials with original classification authority may 
derivatively classify at the same classification level.

[63 FR 14357, Mar. 25, 1998]



Sec. 2.3  Listing of original classification authorities.

    Delegations of original Top Secret, Secret and Confidential 
classification authority shall be in writing and be reported annually to 
the Departmental Director of Security, who shall maintain such 
information on behalf of the Assistant Secretary (Management). These 
delegations are to be limited to the minimum number absolutely required 
for efficient administration. Periodic reviews and evaluations of such 
delegations shall be made by the Departmental Director of Security to 
ensure that the officials so designated have demonstrated a continuing 
need to exercise such authority. If, after reviewing and evaluating the 
information, the Departmental Director of Security determines that such 
officials have not demonstrated a continuing need to exercise such 
authority, the Departmental Director of Security shall recommend to the 
Assistant Secretary (Management), as warranted, the reduction or 
elimination of such authority. The Assistant Secretary (Management) 
shall take appropriate action in consultation with the affected 
official(s) and the Departmental Director of Security. Such action may

[[Page 119]]

include relinquishment of this authority where the Assistant Secretary 
(Management) determines that a firm basis for retention does not exist.



Sec. 2.4  Record requirements.

    The Departmental Director of Security shall maintain a listing by 
name, position title and delegated classification level, of all 
officials in the Departmental Offices who are authorized under this 
regulation to originally classify information as Top Secret, Secret or 
Confidential. Officials within the Departmental Offices with Top Secret 
classification authority shall report in writing on TD F 71-01.14 
(Report of Authorized Classifiers) to the Departmental Director of 
Security, the names, position titles and authorized classification 
levels of the officials designated by them in writing to have original 
Secret or Confidential classification authority. The head of each bureau 
shall maintain a similar listing of all officials in his or her bureau 
authorized to apply original Secret and Confidential classification and 
shall provide a copy of TD F 71-01.14, reflecting the list of officials 
so authorized, to the Departmental Director of Security. These listings 
shall be compiled and reported no less than annually each October 15th 
as required by Treasury Directive 71-01, ``Agency Information Security 
Program Data''.



Sec. 2.5  Classification categories.

    (a) Classification in Context of Related Information [1.3(b)]. 
Certain information which would otherwise be unclassified may require 
classification when combined or associated with other unclassified or 
classified information. Such classification on an aggregate basis shall 
be supported by a written explanation that, at a minimum, shall be 
maintained with the file or referenced on the record copy of the 
information.
    (b) Unofficial Publication or Disclosure [1.3(d)]. Following an 
inadvertent or unauthorized publication or disclosure of information 
identical or similar to information that has been classified in 
accordance with the Order or predecessor Orders, the agency of primary 
interest shall determine the degree of damage to the national security, 
the need for continued classification, and, in coordination with the 
agency in which the disclosure occurred, what action must be taken to 
prevent similar occurrences under procedures contained in Sec. 2.32.



Sec. 2.6  Duration of classification.

    (a) Information Not Marked for Declassification [1.4]. Information 
classified under predecessor orders that is not subject to automatic 
declassification shall remain classified until reviewed for possible 
declassification.
    (b) Authority to Extend Automatic Declassification Determinations 
[1.4(b)]. The authority to extend classification of information subject 
to automatic declassification under any predecessor Executive Order to 
the Order is limited to those officials who have classification 
authority over the information and are designated in writing to have 
original classification authority at the level of the information to 
remain classified. Any decision to extend the classification on other 
than a document-by-document basis shall be reported to the Assistant 
Secretary (Management) who shall, in turn, report this fact to the 
Director of the Information Security Oversight Office.



Sec. 2.7  Identification and markings [1.5(a), (b) and (c)].

    The information security system requires that standard markings be 
applied to classified information. Except in extraordinary circumstances 
as provided in section 1.5(a) of the Order, or as indicated herein, the 
marking of paper and electronically created documents shall not deviate 
from the following prescribed formats. These markings shall also be 
affixed to material other than paper and electronically created 
documents, including file folders, film, tape, etc., or the originator 
shall provide holders or recipients of the information with written 
instructions for protecting the information.
    (a) Classification Level. The markings ``Top Secret,'' ``Secret,'' 
and ``Confidential'' are used to indicate: information that requires 
protection as classified information under the Order;

[[Page 120]]

the highest level of classification contained in a document; the 
classification level of each page and, in abbreviated form, the 
classification of each portion of a document.
    (1) Overall Marking. The highest level of classification of 
information in a document shall be marked in such a way as to 
distinguish it clearly from the informational text. Markings shall 
appear at the top and bottom of the outside of the front cover (if any), 
on the title page (if any), on the first and last pages bearing text, 
and on the outside of the back cover (if any).
    (2) Page Marking. Each interior page of a classified document is to 
be marked at the top and bottom, either according to the highest 
classification of the content of the page, including the designation 
``UNCLASSIFIED'' when it is applicable, or with the highest overall 
classification of the document.
    (3) Portion Marking. Only the Secretary of the Treasury may waive 
the portion marking requirement for specified classes of documents or 
information upon a written determination that:
    (i) There will be minimal circulation of the specified documents or 
information and minimal potential usage of the documents or information 
as a source for derivative classification determinations; or
    (ii) There is some other basis to conclude that the potential 
benefits of portion marking are clearly outweighed by the increased 
administrative burdens.
    (b) Unless the portion marking requirement has been waived as 
authorized, each portion of a document, including subjects and titles, 
shall be marked by placing a parenthetical designation either 
immediately preceding or following the text to which it applies. The 
symbols, ``(TS)'' for Top Secret, ``(S)'' for Secret, ``(C)'' for 
Confidential, and ``(U)'' for Unclassified shall be used for this 
purpose. The symbol, ``(LOU)'' shall be used for Limited Official Use 
information. If the application of parenthetical designations is not 
practicable, the document shall contain a statement sufficient to 
identify the information that is classified and the level of such 
classification, as well as the information that is not classified. If 
all portions of a document are classified at the same level, this fact 
may be indicated by a statement to that effect, e.g. ``Entire Text is 
Classified Confidential.'' If a subject or title requires 
classification, an unclassified identifier may be applied to facilitate 
reference.
    (c) Classification Authority. If the original classifier is other 
than the signer or approver of the document, his or her indentity shall 
be shown at the bottom of the first and last pages as follows: 
``CLASSIFIED BY (identification of original classification authority)''.
    (d) Bureau and Office of Origin. If the identity of the originating 
bureau or office is not apparent on the face of the document, it shall 
be clearly indicated below the ``CLASSIFIED BY'' line.
    (e) Downgrading and Declassification Instructions. Downgrading and, 
as applicable, declassification instructions shall be shown as follows:
    (1) For information to be declassified automatically on a specific 
date:

Classified by___________________________________________________________
Office__________________________________________________________________
Declassify on (date)____________________________________________________

    (2) For information to be declassified automatically upon the 
occurrence of a specific event:

Classified by __________________________________________________________
Office _________________________________________________________________
Declassify on (description of event) ___________________________________
    (3) For information not to be declassified automatically:

Classified by __________________________________________________________
Office _________________________________________________________________
Declassify on Origination Agency's Determination Required or ``OADR''

    (4) For information to be downgraded automatically on a specific 
date or upon occurrence of a specific event:

Classified by __________________________________________________________
Office _________________________________________________________________
Downgrade to ___________________________________________________________
on (date or description of event) ______________________________________
    (f) Special Markings--(1) Transmittal Documents [1.5(c)]. A 
transmittal document shall indicate on its first page and last page, if 
any, the highest classification of any information transmitted by it. It 
shall also include on the first and last pages the following or similar 
instruction:

[[Page 121]]

    (i) For an unclassified transmittal document:

Unclassified When Classified
Enclosure(s) Detached.

    (ii) For a classified transmittal document:

Upon Removal of Attachment(s)
this Document is _______________________________________________________


(classification level of the transmittal document alone), or:

This Document is Classified ____________________________________________
with Unclassified Attachment(s).

    (2) Restricted Data or Formerly Restricted Data [6.2(a)]. Restricted 
Data or Formerly Restricted Data shall be marked in accordance with 
regulations issued under the Atomic Energy Act of 1954, as amended. 
Restricted Data is information dealing with the design, manufacture, or 
utilization of atomic weapons, production of special nuclear material or 
use of special nuclear material in the production of energy. Formerly 
Restricted Data is classified information that has been removed from the 
``restricted data'' category but still remains classified. It relates 
primarily to the military utilization of atomic weapons.
    (3) Intelligence Sources or Methods [1.5(c)]. Documents that contain 
information relating to intelligence sources or methods shall include 
the following marking unless otherwise prescribed by the Director of 
Central Intelligence: ``WARNING NOTICE--INTELLIGENCE SOURCES OR METHODS 
INVOLVED'' To avoid confusion as to the extent of dissemination and use 
restrictions governing the information involved, this marking may not be 
used in conjunction with special access or sensitive compartmented 
information controls.
    (4) Foreign Government Information (FGI) [1.5(c)]. Documents that 
contain FGI shall include either the marking ``FOREIGN GOVERNMENT 
INFORMATION,'' or a marking that otherwise indicates that the 
information is foreign government information. If the information is 
foreign government information that must be concealed, given the 
relationship or understanding with the foreign government providing the 
information, the marking shall not be used and the document shall be 
marked as if it were wholly of United States origin. However, such a 
marking must be supported by a written explanation that, at a minimum, 
shall be maintained with the file or referenced on the original or 
record copy of the document or information.
    (5) National Security Information [4.1(c)]. Classified information 
furnished outside the Executive Branch shall show the following marking:

NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to
Administrative and Criminal Sanctions

    (6) Automated Data Processing (ADP) and Computer Output [1.5(c)]. 
(i) Documents that are generated via ADP or as computer output may be 
marked automatically by systems software. If automatic marking is not 
practicable, such documents must be marked manually.
    (ii) Removable information storage media, however, will bear 
external labels indicating the security classification of the 
information and associated security markings, as applicable, such as 
handling caveats and dissemination controls. Examples of such media 
include magnetic tape reels, cartridges, and cassettes; removable disks, 
disk cartridges, disk packs, and diskettes, including ``floppy'' or 
flexible disks; paper tape reels; and magnetic and punched cards. Two 
labels may be required on each medium: a color coded security 
classification label, i.e., orange Standard Form 706 (Top Secret label), 
red SF 707 (Secret label), blue SF 708 (Confidential label), purple SF 
709 (Classified label), green SF 710 (Unclassified label); and a white 
SF 711 (Data Descriptor label). National stock numbers of the labels, 
which are available through normal Federal Supply channels, are as 
follows: SF 706, 7540-01-207-5536; SF 707, 7450-01-207-5537; SF 708, 
7450-01-207-5538; SF 709, 7540-01-207-5540; SF 710, 7540-01-207-5539 and 
SF 711, 7540-01-207-5541. Treasury Directive 71-02 provides for the use 
of a green ``Officially Limited Information'' label, TD F 71-05.2, to 
identify information so marked.
    (iii) In a mixed environment in which classified and unclassified 
information in processed or stored, the ``Unclassified'' label must be 
used to identify the media containing unclassified information. In 
environments in which only

[[Page 122]]

unclassified information is processed or stored, the use of the 
``Unclassified'' label is not required. Unclassified media, however, 
that are on loan from (and must be returned to) vendors do not require 
the ``Unclassified'' label, but each requires a Data Descriptor label 
with the words, ``Unclassified Vendor Medium'' entered on it.
    (iv) Each medium shall be appropriately affixed with a 
classification label and, as applicable, with a Data Descriptor label at 
the earliest practicable time as soon as the proper security 
classification or control has been established. Labels shall be 
conspicuously placed on media in a manner that will not adversely affect 
operation of the equipment in which the media is used. Once applied, the 
label is not to be removed. A label to identify a higher level of 
classification may, however, be applied on top of a lower classification 
level in the event that the content of the media changes, e.g., from 
Confidential to Secret. A lower classification label may not be applied 
to media already bearing a higher classification label. Personnel shall 
be responsible for appropriately labeling and controlling ADP and 
computer storage media within their possession.
    (g) Electronically Transmitted Information (Messages) [1.5(c)]. 
Classified information that is transmitted electronically shall be 
marked as follows:
    (1) The highest level of classification shall appear before the 
first line of text;
    (2) A ``CLASSIFIED BY'' line is not required;
    (3) The duration of classification shall appear as follows:
    (i) For information to be declassified automatically on a specific 
date: ``DECL: (date)'';
    (ii) For information to be declassified upon occurrence of a 
specific event: ``DECL: (description of event)'';
    (iii) For information not to be automatically declassified which 
requires the originating agency's determination (see also 
Sec. 2.7(e)(3)): ``DECL: OADR'';
    (iv) For information to be automatically downgraded: ``DOWNGRADE TO 
(classification level to which the information is to be downgraded) ON 
(date or description of event on which downgrading is to occur)''.
    (4) Portion marking shall be as prescribed in Sec. 2.7(a)(3);
    (5) Specially designated markings as prescribed in Sec. 2.7(f) (2), 
(3), and (4) shall appear after the marking for the highest level of 
classification. These include:
    (i) Restricted Data or Formerly Restricted Data;
    (ii) Information concerning intelligence sources or methods: 
``WNINTEL,'' unless otherwise prescribed by the Director of Central 
Intelligence; and
    (iii) Foreign Government Information (FGI).
    (6) Paper copies of electronically transmitted messages shall be 
marked as provided in Sec. 2.7(a) (1), (2), and (3).
    (h) Changes in Classification Markings [4.1(b)]. When a change is 
made in the duration of classified information, all holders of record 
shall be promptly notified. If practicable, holders of record shall also 
be notified of a change in the level of classification. Holders shall 
alter the markings on their copy of the information to conform to the 
change, citing the authority for it. If the remarking of large 
quantities of information is unduly burdensome, the holder may attach a 
change of classification notice to the storage unit in lieu of the 
marking action otherwise required. Items withdrawn from the collection 
for purposes other than transfer for storage shall be marked promptly in 
accordance with the change notice.



Sec. 2.8  Limitations on classification [1.6(c)].

    (a) Before reclassifying information as provided in section 1.6(c) 
of the Order, authorized officials, who must have original 
classification authority and jurisdiction over the information involved, 
shall consider the following factors which shall be addressed in a 
report to the Assistant Secretary (Management) who shall in turn forward 
a report to the Director of the Information Security Oversight Office:
    (1) The elapsed time following disclosure;
    (2) The nature and extent of disclosure;

[[Page 123]]

    (3) The ability to bring the fact of reclassification to the 
attention of persons to whom the information was disclosed;
    (4) The ability to prevent further disclosure; and
    (5) The ability to retrieve the information voluntarily from persons 
not authorized access in its reclassified state.
    (b) Information may be classified or reclassified after it has been 
requested under the Freedom of Information Act (5 U.S.C. 552), the 
Privacy Act of 1974 (5 U.S.C. 552a), or the mandatory declassification 
review provisions of the Order if such classification meets the 
requirements of the Order and is accomplished personally and on a 
document-by-document basis by the Secretary of the Treasury, the Deputy 
Secretary, the Assistant Secretary (Management) or an official with 
original Top Secret classification authority. Such reclassification 
actions shall be reported in writing to the Departmental Director of 
Security.
    (c) In no case may information be classified or reclassified in 
order to conceal violations of law, inefficiency, or administrative 
error; to prevent embarrassment to a person, organization, or agency; to 
restrain competition; or to prevent or delay the release of information 
that does not require protection in the interest of national security.



                  Subpart B--Derivative Classification



Sec. 2.9  Derivative Classification Authority.

    Designations of derivative classification authority for national 
security information are contained in Treasury Order 102-19 (or 
successor order). The authority to derivatively classify inheres within 
the office and may be exercised by a person acting in that capacity. 
There may be additional redelegations of derivative classification 
authority made pursuant to TO 102-19 (or successor order). Officials 
identified in Treasury Order 102-19 (or successor order) may also 
administratively control and decontrol sensitive but unclassified 
information using the legend ``Limited Official Use'' and may redelegate 
their authority to control and decontrol. Such redelegations shall be in 
writing on TD F 71-01.20 ``Designation of Controlling/Decontrolling 
Officials'' (or successor form).

[63 FR 14357, Mar. 25, 1998]



Sec. 2.10  Listing derivative classification authorities.

    Delegations of derivative classification authority to officials not 
otherwise identified in Sec. 2.9, shall be in writing and reported 
annually each October 15th to the Departmental Director of Security on 
TD F 71-01.18 (Report of Authorized Derivative Classifiers). Such 
delegations shall be limited to the minimum number absolutely required 
for efficient administration. Periodic reviews and evaluations of such 
delegations shall be made by the Departmental Director of Security to 
ensure that officials so designated have demonstrated a continuing need 
to exercise such authority. If after reviewing and evaluating the 
information the Departmental Director of Security determines that such 
officials have not demonstrated a continuing need to exercise such 
authority, the Departmental Director of Security shall recommend to the 
Assistant Secretary (Management), as warranted, the reduction or 
elimination of such authority. The Assistant Secretary (Management) 
shall take appropriate action in consultation with the affected 
official(s) and the Departmental Director of Security. Such action may 
include relinquishment of this authority where the Assistant Secretary 
(Management) determines that a firm basis for retention does not exist.



Sec. 2.11  Use of derivative classification [2.1].

    The application of derivative classification markings is a 
responsibility of those who incorporate, paraphrase, restate, or 
generate in new form information that is already classified, and of 
those who apply markings in accordance with instructions from an 
authorized original classifier or in accordance with an approved 
classification guide. If an individual who applies derivative 
classification markings believes that the paraphrasing, restating or 
summarizing of classified information has

[[Page 124]]

changed the level of or removed the basis for classification, that 
person must consult an appropriate official of the originating agency or 
office of origin who has the authority to upgrade, downgrade or 
declassify the information for a final determination. A sample marking 
of derivatively classified documents is set forth in Sec. 2.13.



Sec. 2.12  Classification guides.

    (a) General [2.2(a)]. A classification guide is a reference manual 
which assists document drafters and document classifiers in determining 
what types or categories of material have already been classified. The 
classification guide shall, at a minimum:
    (1) Identify and categorize the elements of information to be 
protected;
    (2) State which classification level applies to each element or 
category of information; and
    (3) Prescribe declassification instructions for each element or 
category of information in terms of:
    (i) A period of time,
    (ii) The occurrence of an event, or
    (iii) A notation that the information shall not be declassified 
automatically without the approval of the originating agency i.e., 
``OADR''.
    (b) Review and Record Requirements [2.2(a)]. (1) Each classification 
guide shall be kept current and shall be reviewed at least once every 
two years and updated as necessary. Each office within the Departmental 
Offices and the respective offices of each Treasury bureau possessing 
original classification authority for national security information 
shall maintain a list of all classification guides in current use by 
them. A copy of each such classification guide in current use shall be 
furnished to the Departmental Director of Security who shall maintain 
them on behalf of the Assistant Secretary (Management).
    (2) Each office and bureau that prepares and maintains a 
classification guide shall also maintain a record of individuals 
authorized to apply derivative classification markings in accordance 
with a classification guide. This record shall be maintained on TD F 71-
01.18 (Report of Authorized Derivative Classifiers) which shall be 
reported annually each October 15th to the Departmental Director of 
Security.
    (c) Waivers [2.2(c)]. Any authorized official desiring a waiver of 
the requirement to issue a classification guide shall submit in writing 
to the Assistant Secretary (Management) a request for approval of such a 
waiver. Any request for a waiver shall contain, at a minimum, an 
evaluation of the following factors:
    (1) The ability to segregate and describe the elements of 
information;
    (2) The practicality of producing or disseminating the guide because 
of the nature of the information;
    (3) The anticipated usage of the guide as a basis for derivative 
classification; and
    (4) The availability of alternative sources for derivatively 
classifying the information in a uniform manner.



Sec. 2.13  Derivative identification and markings [1.5(c) and 2.1(b)].

    Information classified derivatively on the basis of source documents 
or classification guides shall bear all markings prescribed in Sec. 2.7 
(a) through (f), as are applicable. Information for these markings shall 
be taken from the source document or instructions in the appropriate 
classification guide.
    (a) Classification Authority. The authority for classification shall 
be shown as follows:

Derivatively Classified by _____________________________________________
Office _________________________________________________________________
Derived from____________________________________________________________
Declassify on___________________________________________________________


If a document is classified on the basis of more than one source 
document or classification guide, the authority for classification shall 
be shown on the ``DERIVED FROM'' line as follows: ``MULTIPLE CLASSIFIED 
SOURCES''. In these cases, the derivative classifier must maintain the 
identification of each source with the file or record copy of the 
derivatively classified document. A document derivatively classified on 
the basis of a source document that is marked ``MULTIPLE CLASSIFIED 
SOURCES'' shall cite the source document on its ``DERIVED FROM'' line 
rather than the term: ``MULTIPLE CLASSIFIED

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SOURCES''. Preparers of such documentation shall ensure that the 
identification of the derivative classifier is indicated. Use of the 
term ``MULTIPLE CLASSIFIED SOURCES,'' is not to be a substitute for the 
identity of the derivative classification authority.
    (b) Downgrading and Declassification Instructions. Dates or events 
for automatic downgrading or declassification shall be carried forward 
from the source document. This includes the notation ``ORIGINATING 
AGENCY'S DETERMINATION REQUIRED'' to indicate that the document is not 
to be downgraded or declassified automatically, or instructions as 
directed by a classification guide, which shall be shown on a 
``DOWNGRADE TO'' or ``DECLASSIFY ON'' line as follows:

DOWNGRADE TO____________________________________________________________
ON (date, description of event, or OADR) or,
DECLASSIFY ON (date, description of event, or OADR)



               Subpart C--Downgrading and Declassification



Sec. 2.14  Listing downgrading and declassification authorities 3.1(b)].

    Downgrading and declassification authority may be exercised by the 
official authorizing the original classification, if that official is 
still serving in the same position; a successor in that capacity; a 
supervisory official of either; or officials delegated such authority in 
writing by the Secretary of the Treasury or the Assistant Secretary 
(Management). Such officials may not downgrade or declassify information 
which is classified at a level exceeding their own designated 
classification authority. A listing of officials delegated such 
authority, in writing, shall be identified on TD F 71-01.11 (Report of 
Authorized Downgrading and Declassification Officials) and reported 
annually each October 15th to the Departmental Director of Security who 
shall maintain them on behalf of the Assistant Secretary (Management). 
Current listings of officials so designated shall be maintained by 
Treasury bureaus and offices within the Departmental Offices.

[55 FR 1644, Jan. 17, 1990; 55 FR 13134, Apr. 9, 1990]



Sec. 2.15  Declassification policy [3.1].

    In making determinations under section 3.1(a) of the Order, 
officials shall respect the intent of the Order to protect foreign 
government information and confidential foreign sources.



Sec. 2.16  Downgrading and declassification markings.

    Whenever a change is made in the original classification or in the 
dates of downgrading or declassification of any classified information, 
it shall be promptly and conspicuously marked to indicate the change, 
the authority for the action, the date of the action, and the identity 
of the person taking the action. Earlier classification markings shall 
be cancelled or otherwise obliterated when practicable. See also 
Sec. 2.7(h).



Sec. 2.17  Systematic review for declassification [3.3].

    (a) Permanent Records. Systematic review is applicable only to those 
classified records and presidential papers or records that the Archivist 
of the United States, acting under the Federal Records Act, has 
determined to be of sufficient historical or other value to warrant 
permanent retention.
    (b) Non-Permanent Classified Records. Non-permanent classified 
records shall be disposed of in accordance with schedules approved by 
the Administrator of General Services under the Records Disposal Act. 
These schedules shall provide for the continued retention of records 
subject to an ongoing mandatory declassification review request.
    (c) Systematic Declassification Review Guidelines [3.3(a)]. As 
appropriate, guidelines for systematic declassification review shall be 
issued by the Assistant Secretary (Management) in consultation with the 
Archivist of the United States, the Director of the Information Security 
Oversight Office and Department officials, to assist the Archivist in 
the conduct of systematic reviews. Such guidelines shall be reviewed and 
updated at least every five years unless earlier review is requested by 
the Archivist.
    (d) Foreign Government Systematic Declassification Review Guidelines 
[3.3(a)]. As appropriate, guidelines for systematic declassification 
review of foreign

[[Page 126]]

government information shall be issued by the Assistant Secretary 
(Management) in consultation with the Archivist of the United States, 
the Director of the Information Security Oversight Office, Department 
officials and other agencies having declassification authority over the 
information. These guidelines shall be reviewed and updated every five 
years unless earlier review is requested by the Archivist.
    (e) Special Procedures. The Department shall be bound by the special 
procedures for systematic review of classified cryptologic records and 
classified records pertaining to intelligence activities (including 
special activities), or intelligence sources or methods issued by the 
Secretary of Defense and the Director of Central Intelligence, 
respectively.



Sec. 2.18  Mandatory declassification review [3.4].

    (a) Except as provided by section 3.4 (b) of the Order, all 
information classified by the Department under the Order or any 
predecessor Executive Order shall be subject to declassification review 
by the Department, if:
    (1) The request is made by a United States citizen or permanent 
resident alien, a Federal agency, or a state or local government;
    (2) The request describes the document or material containing the 
information with sufficient specificity to enable the Department to 
locate it with a reasonable amount of effort; and
    (3) The requester provides substantial proof as to his or her United 
States citizenship or status as a permanent resident alien, e.g., a copy 
of a birth certificate, a certificate of naturalization, official 
passport or some other means of identity which sufficiently describes 
the requester's status. A permanent resident alien is any individual, 
who is not a citizen or national of the United States, who has been 
lawfully accorded the privilege of residing permanently in the United 
States as an immigrant in accordance with the immigration laws, such 
status not having changed. Permanent means a relationship of continuing 
or lasting nature, as distinguished from temporary, but a relationship 
may be permanent even though it is one that may be dissolved eventually 
at the instance either of the United States or of the individual, in 
accordance with law.
    (b) Processing--(1) Initial Requests for Classified Records 
Originated by the Department. Requests for mandatory declassification 
review shall be directed to the Departmental Office of Security, 1500 
Pennsylvania Avenue, NW., Washington, DC 20220. Upon receipt of each 
request for declassification, pursuant to section 3.4 of the Order, the 
following procedures shall apply:
    (i) The Departmental Office of Security shall acknowledge the 
receipt of the request in writing.
    (ii) A valid mandatory declassification review request need not 
identify the requested information by date or title of the responsive 
records, but must be of sufficient particularity to allow Treasury 
personnel to locate the records containing the information sought with a 
reasonable amount of effort. Whenever a request does not reasonably 
describe the information sought, the requester shall be notified by the 
Departmental Office of Security that unless additional information is 
provided or the scope of the request is narrowed, no further action will 
be undertaken.
    (iii) The Departmental Office of Security shall determine the 
appropriate office or bureau to take action on the request and shall 
forward the request to that office or bureau.
    (iv) In responding to mandatory declassification review requests, 
the appropriate reviewing officials shall make a prompt declassification 
determination. The Departmental Office of Security shall notify the 
requester if additional time is needed to process the request. Reviewing 
officials shall also identify the amount of search and/or review time 
required to process the request. The Department shall make a final 
determination within one year from the date of receipt except in unusual 
circumstances. When information cannot be declassified in its entirety, 
reasonable efforts, consistent with other applicable laws, will be made 
to release those declassified portions of the requested information 
which constitute a coherent segment. Upon the denial or partial denial 
of an

[[Page 127]]

initial request, the Departmental Office of Security shall also notify 
the requester of the right of an administrative appeal which must be 
filed with the Assistant Secretary (Management) within 60 days of 
receipt of the denial.
    (v) When the Department receives a mandatory declassification review 
request for records in its possession that were originated by another 
agency, the Departmental Office of Security shall forward the request to 
that agency. The Departmental Office of Security shall include a copy of 
the records requested together with the Department's recommendations for 
action. Upon receipt, the originating agency shall process the request 
in accordance with the Directive 32 CFR 2001.32(a)(2)(i). The 
originating agency shall also be requested to communicate its 
declassification determination to Treasury.
    (vi) When another agency forwards to the Department a request for 
information in that agency's custody that has been classified by 
Treasury, the Departmental Office of Security shall:
    (A) Advise the other agency as to whether it can notify the 
requester of the referral;
    (B) Review the classified information in coordination with other 
agencies that have a direct interest in the subject matter; and
    (C) Respond to the requester in accordance with the procedures in 
Sec. 2.18(b)(1)(iv). If requested, Treasury's determination shall be 
communicated to the referring agency.
    (vii) Appeals of denials of a request for declassification shall be 
referred to the Assistant Secretary (Management) who shall normally make 
a determination within 30 working days following the receipt of an 
appeal. If additional time is required to make a determination, the 
Assistant Secretary (Management) shall notify the requester of the 
additional time needed and provide the requester with the reason for the 
extension. The Assistant Secretary (Management) shall notify the 
requester in writing of the final determination and, as applicable, the 
reasons for any denial.
    (viii) Except as provided in this paragraph, the Department shall 
process mandatory declassification review requests for classified 
records containing foreign government information in accordance with 
Sec. 2.18(a). The agency that initially received or classified the 
foreign government information shall be responsible for making a 
declassification determination after consultation with concerned 
agencies. If upon receipt of the request, the Department determines that 
Treasury is not the agency that received or classified the foreign 
government information, it shall refer the request to the appropriate 
agency for action. Consultation with the foreign originator through 
appropriate channels may be necessary prior to final action on the 
request.
    (ix) Mandatory declassification review requests for cryptologic 
information and/or information concerning intelligence activities 
(including special activities) or intelligence sources or methods shall 
be processed solely in accordance with special procedures issued by the 
Secretary of Defense and the Director of Central Intelligence, 
respectively.
    (x) The fees to be charged for mandatory declassification review 
requests shall be for search and/or review and duplication. The fee 
charges for services of Treasury personnel involved in locating and/or 
reviewing records shall be at the rate of a GS-10, Step 1, for each hour 
or fraction thereof, except that no charge shall be imposed for search 
and/or review consuming less than one hour.
    (A) Photocopies per page up to 8\1/2\" by 14" shall be charged at 
the rate of 10 cents each except that no charge will be imposed for 
reproducing ten (10) pages or less when search and/or review time 
requires less than one hour.
    (B) When it is estimated that the costs associated with the 
mandatory declassification review request will exceed $100.00, the 
Departmental Office of Security shall notify the requester of the likely 
cost and obtain satisfactory written assurance of full payment or may 
require the requester to make an advance payment of the entire fee 
before continuing to process the request. The Department reserves the 
right to request prepayment after a mandatory declassification review 
request is processed and before documents are released. In the event the 
requester does

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not agree to pay the actual charges, he or she shall advise how to 
proceed with the mandatory declassification review request. Failure of a 
requester to pay charges after billing will result in future requests 
not being honored.
    (C) In order for a requester's initial request to be processed it 
shall be accompanied by a statement that he or she is agreeable to 
paying fees for search and/or review and copying. In the event the 
initial request does not include this statement, processing of the 
request will be held in abeyance until such time as the required 
statement is received. Failure to provide a response within a reasonable 
amount of time will serve as the basis for administratively terminating 
the mandatory declassification review request.
    (D) Payment of fees shall be made by check or money order payable to 
the Treasurer of the United States. Fees levied by the Department of the 
Treasury for mandatory declassification review requests are separate and 
distinct from any other fees which might be imposed by a Presidential 
Library, the National Archives and Records Administration or another 
agency or department.



Sec. 2.19  Assistance to the Department of State [3.3(b)].

    The Secretary of the Treasury shall assist the Department of State 
in its preparation of the ``Foreign Relations of the United States'' 
series by facilitating access to appropriate classified material in 
Treasury custody and by expediting declassification review of documents 
proposed for inclusion in the series.



Sec. 2.20  Freedom of Information/Privacy Act requests [3.4].

    The Department of the Treasury shall process requests for records 
containing classified national security information that are submitted 
under the provisions of the Freedom of Information Act, as amended, or 
the Privacy Act of 1974, as amended, in accordance with the provisions 
of those Acts.



                         Subpart D--Safeguarding



Sec. 2.21  General [4.1].

    Information classified pursuant to this Order or predecessor Orders 
shall be afforded a level of protection against unauthorized disclosure 
commensurate with its level of classification.



Sec. 2.22  General restrictions on access [4.1].

    (a) Determination of Need-To-Know. Classified information shall be 
made available to a person only when the possessor of the classified 
information establishes in each instance, except as provided in section 
4.3 of the Order, that access is essential to the accomplishment of 
official United States Government duties or contractual obligations.
    (b) Determination of Trustworthiness. A person is eligible for 
access to classified information only after a showing of trustworthiness 
as determined by the Secretary of the Treasury based upon appropriate 
investigations in accordance with applicable standards and criteria.
    (c) Classified Information Nondisclosure Agreement. Standard Form 
312 (Classified Information Nondisclosure Agreement) or the prior SF 
189, bearing the same title, are nondisclosure agreements between the 
United States and an individual. The execution of either the SF 312 or 
SF 189 agreement by an individual is necessary before the United States 
Government may grant the individual access to classified information. 
Bureaus and the Departmental Offices must retain executed copies of the 
SF 312 or prior SF 189 in file systems from which the agreements can be 
expeditiously retrieved in the event the United States must seek their 
enforcement. Copies or legally enforceable facsimiles of the SF 312 or 
SF 189 must be retained for 50 years following their date of execution. 
The national stock number for the SF 312 is 7540-01-280-5499.

[[Page 129]]



Sec. 2.23  Access by historical researchers and former presidential appointees [4.3].

    (a) Access to classified information may be granted only as is 
essential to the accomplishment of authorized and lawful United States 
Government purposes. This requirement may be waived, however, for 
persons who:
    (1) Are engaged in historical research projects, or
    (2) Previously have occupied policymaking positions to which they 
were appointed by the President.
    (b) Access to classified information may be granted to historical 
researchers and to former Presidential appointees upon a determination 
of trustworthiness; a written determination that such access is 
consistent with the interests of national security; the requestor's 
written agreement to safeguard classified information; and the 
requestor's written consent to have his or her notes and manuscripts 
reviewed to ensure that no classified information is contained therein. 
The conferring of historial researcher status does not include 
authorization to release foreign government information or other 
agencies' classified information per Sec. 2.24 of this part. By the 
terms of section 4.3(b)(3) of the Order, former Presidential appointees 
not engaged in historical research may only be granted access to 
classified documents which they ``originated, reviewed, signed or 
received while serving as a Presidential appointee.'' Coordination shall 
be made with the Departmental Director of Security with respect to the 
required written agreements to be signed by the Department and such 
historical researchers or former Presidential appointees, as a condition 
of such access and to ensure the safeguarding of classified information.
    (c) If the access requested by historical researchers and former 
Presidential appointees requires the rendering of services for which 
fair and equitable fees may be charged pursuant to 31 U.S.C. 9701, the 
requestor shall be so notified and the fees may be imposed. Treasury's 
fee schedule identified in Sec. 2.18(b)(1)(x), applicable to mandatory 
declassification review, shall also apply to fees charged for services 
provided to historical researchers and former Presidential appointees 
for search and/or review and copying.



Sec. 2.24  Dissemination [4.1(d)].

    Except as otherwise provided by section 102 of the National Security 
Act of 1947, 61 Stat. 495, 50 U.S.C. 403, classified information 
originating in another agency may not be disseminated outside the 
Department without the consent of the originating agency.



Sec. 2.25  Standards for security equipment [4.1(b) and 5.1(b)].

    The Administrator of General Services issues (in coordination with 
agencies originating classified information), establishes and publishes 
uniform standards, specifications, and supply schedules for security 
equipment designed to provide for secure storage and to destroy 
classified information. Treasury bureaus and the Departmental Offices 
may establish more stringent standards for their own use. Whenever new 
security equipment is procured, it shall be in conformance with the 
standards and specifications referred to above and shall, to the maximum 
extent practicable, be of the type available through the Federal Supply 
System.



Sec. 2.26  Accountability procedures [4.1(b)].

    (a) Top Secret Control Officers. Each Treasury bureau and the 
Departmental Offices shall designate a primary and alternate Top Secret 
Control Officer. Within the Departmental Offices, the Top Secret Control 
Officer function will be established in the Office of the Executive 
Secretary for collateral Top Secret information and in the Office of the 
Special Assistant to the Secretary (National Security) with respect to 
sensitive compartmented information. The term ``collateral'' refers to 
national security information classified Confidential, Secret, or Top 
Secret under the provisions of Executive Order 12356 or prior Orders, 
for which special intelligence community systems of compartmentation 
(such as sensitive compartmented information) or special access programs 
are not formally established. Top Secret Control Officers so designated 
must have a Top Secret security clearance and shall:

[[Page 130]]

    (1) Initially receive all Top Secret information entering their 
respective bureau, including the Departmental Offices. Any Top Secret 
information received by a Treasury bureau or Departmental Offices 
employee shall be immediately hand carried to the designated Top Secret 
Control Officer for proper accountability.
    (2) Maintain current accountability records of Top Secret 
information received within their bureau or office.
    (3) Ensure that Top Secret information is properly stored and that 
Top Secret information under their control is personally destroyed, when 
required. Top Secret information must be destroyed in the presence of an 
appropriately cleared official who shall actually witness such 
destruction. Accordingly, the use of burnbags to store Top Secret 
information, pending final destruction at a later date, is not 
authorized.
    (4) Ensure that prohibitions against reproduction of Top Secret 
information are strictly followed.
    (5) Conduct annual physical inventories of Top Secret information. 
An inventory shall be conducted in the presence of an individual with an 
appropriate security clearance. The inventory shall be completed 
annually and signed by the Top Secret Control Officer and the witnessing 
individual.
    (6) Ensure that Top Secret documents are downgraded, declassified, 
retired or destroyed as required by regulations or other markings.
    (7) Attach a TD F 71-01.7 (Top Secret Document Record) to the first 
page or cover of each copy of Top Secret information. The Top Secret 
Document Record shall be completed by the Top Secret Control Officer and 
shall serve as a permanent record.
    (8) Ensure that all persons having access to Top Secret information 
sign the Top Secret Document Record. This also includes persons to whom 
oral disclosure of the contents is made.
    (9) Maintain receipts concerning the transfer and destruction of Top 
Secret information. Record all such actions on the Top Secret Document 
Record which shall be retained for a minimum of three years.
    (10) As received, number in sequence each Top Secret document in a 
calendar year series (e.g. TS 89-001). This number shall be posted on 
the face of the document and on all forms required for control of Top 
Secret information.
    (11) Attach a properly executed TD F 71-01.5 (Classified Document 
Record of Transmittal) when a Top Secret document is transmitted 
internally or externally.
    (12) Verify, prior to releasing Top Secret information, that the 
recipient has both a security clearance and is authorized access to such 
information.
    (13) Report, in writing, all Top Secret documents unaccounted for to 
the Assistant Secretary (Management) who shall take appropriate action 
in conjunction with the Departmental Director of Security.
    (14) Assure that no individual within his or her office or bureau 
transmits Top Secret information to another individual or office without 
the knowledge and consent of the Top Secret Control Officer.
    (15) Ensure upon receipt that a Standard Form 703 (Top Secret Cover 
Sheet) is affixed to such information.
    (16) Notify office and/or bureau employees annually in writing of 
the designated control point for all incoming and outgoing Top Secret 
information.
    (17) Be notified as to the transmission, per Sec. 2.28(b), whenever 
Top Secret information is sent outside of a Treasury bureau or office 
within the Departmental Offices.
    (b) Top Secret Control Officer Listings. In order for the 
Departmental Director of Security to maintain a current listing of Top 
Secret Control Officers within the Department, each Treasury bureau and 
the Departmental Offices shall annually report each October 15th in 
writing to the Departmental Office of Security, the identities of the 
office(s) and names of the officials designated as their primary and 
alternate Top Secret Control Officers. Any changes in these designations 
shall be reported to the Departmental Director of Security within thirty 
days.
    (c) Top Secret Document Record. Upon receipt in the Department a 
green, color coded, TD F 71-01.7 (Top Secret Document Record) shall be 
attached by the Top Secret Control Officer to the first page or cover of 
the original and each copy of Top Secret information.

[[Page 131]]

The Top Secret Document Record shall remain attached to the Top Secret 
information until it is either transferred to another United States 
Government agency, downgraded, declassified or destroyed. The Top Secret 
Document Record, which shall initially be completed by the Top Secret 
Control Officer, shall identify the Top Secret information attached, and 
shall serve as a permanent record of the information. All persons, 
including stenographic and clerical personnel, having access to the 
information attached to the Top Secret Document Record must list their 
name and the date on the TD F 71-01.7 prior to accepting responsibility 
for its custody. The TD F 71-01.7 shall also indicate those individuals 
to whom only oral disclosure of the contents is made. Whenever any Top 
Secret information is transferred to another United States Government 
agency, downgraded, declassified or destroyed, the Top Secret Control 
Officer shall record the action on the Top Secret Document Record and 
retain it for a minimum or three years after which time it may be 
destroyed. In order to maintain the integrity of the color coding 
process the photocopying and use of non-color coded Top Secret Document 
Record forms is prohibited.
    (d) Classified Document Record of Transmittal. TD F 71-01.5 
(Classified Document Record of Transmittal) shall be the exclusive 
classified document accountability record for use within the Department 
of the Treasury. No other logs or records shall be required except for 
the use of TD F 71-01.7 which is applicable to Top Secret information. 
TD F 71-01.5 shall be used for single or multiple document receipting 
and for internal and external routing. The inclusion of classified 
information on TD F 71-01.5 is to be avoided. In the event the subject 
title is classified, a recognizable short title shall be used, e.g., 
first letter of each word in the subject title. Several items may be 
transmitted to the same addressee with one TD F 71-01.5. TD F's 71-01.5 
shall be maintained for a three year period after which the form may be 
destroyed. No record of the actual destruction of the TD F 71-01.5 is 
necessary.
    (1) Top Secret Information. Top Secret information shall be subject 
to a continuous receipt system regardless of how brief the period of 
custody. TD F 71-01.5 shall be used for this purpose. Top Secret 
accountability records shall be maintained by Top Secret Control 
Officers separately from the accountability records of other classified 
information.
    (2) Secret Information. Receipt on TD F 71-01.5 shall be required 
for transmission of Secret information between bureaus, offices and 
separate agencies. Responsible office heads shall determine 
administrative procedures required for the internal control within their 
respective offices. The volume of classified information handled and 
personnel resources available must be considered in determining the 
level of adequate security measures while at the same time maintaining 
operational efficiency.
    (3) Confidential and Limited Official Use Information. Receipts for 
Confidential and Limited Official Use information shall not be required 
unless the originator indicates that receipting is necessary.

[55 FR 1644, Jan. 17, 1990; 55 FR 13134, Apr. 9, 1990]



Sec. 2.27  Storage [4.1(b)].

    Classified information shall be stored only in facilities or under 
conditions designed to prevent unauthorized persons from gaining access 
to it.
    (a) Minimum Requirements for Physical Barriers--(1) Top Secret. Top 
Secret information shall be stored in a GSA-approved security container 
with an approved, built-in, three-position, dial-type, changeable, 
combination lock; in a vault protected by an alarm system and response 
force; or in other types of storage facilities that meet the standards 
for Top Secret information established under the provisions of 
Sec. 2.25. Top Secret information stored outside the United States must 
be in a facility afforded diplomatic status. One or more of the 
following supplementary controls is required:
    (i) The area that houses the security container or vault shall be 
subject to the continuous protection of U.S. guard or duty personnel;
    (ii) U.S. Guard or duty personnel shall inspect the security 
container or vault at least once every two hours; or

[[Page 132]]

    (iii) The security container or vault shall be controlled by an 
alarm system to which a force will respond in person within 15 minutes.

Within the United States, the designated security officer in each 
Treasury bureau and the Department Offices shall prescribe those 
supplementary controls deemed necessary to restrict unauthorized access 
to areas in which such information is stored. Any vault used for the 
storage of sensitive compartmented information shall be configured to 
the specifications of the Director of Central Intelligence. Prior to an 
office or bureau operating such a vault, formal written certification 
for its use must first be obtained from the Special Assistant to the 
Secretary (National Security) as the senior Treasury official of the 
Intelligence Community.
    (2) Secret and Confidential. Secret and Confidential information 
shall be stored in a manner and under the conditions prescribed for Top 
Secret information, or in a container, vault, or alarmed area that meets 
the standards for Secret or Confidential information established under 
the provisions of Sec. 2.25. Secret and Confidential information may 
also be stored in a safe-type filing cabinet having a built-in, three-
position, dial-type, changeable, combination lock, and may continue to 
be stored in a steel filing cabinet equipped with a steel lock-bar 
secured by a GSA-approved three-position, dial-type, changeable, 
combination padlock. The modification, however, of steel filing cabinets 
to barlock-type as storage equipment for classified information and 
material is prohibited and efforts are to be made to selectively phase 
out the use of such barlock cabinets for storage of Secret information. 
Exceptions may be authorized only by the Departmental Director of 
Security upon written request from the designated bureau security 
officer. The designated security officer in each Treasury bureau and the 
Departmental Offices shall prescribe those supplementary controls deemed 
necessary to restrict unauthorized access to areas in which such 
information is stored. Access to bulky Secret and Confidential material 
in weapons storage areas, strong rooms, evidence vaults, closed areas or 
similar facilities shall be controlled in accordance with requirements 
approved by the Department. At a minimum, such requirements shall 
prescribe the use of GSA-approved, key-operated, high-security padlocks. 
For Secret and Confidential information stored outside the United 
States, it shall be stored in the manner authorized for Top Secret, in a 
GSA-approved safe file, or in a barlick cabinet equipped with a 
security-approved combination padlock if the cabinet is located in a 
security-approved vault and/or in a restricted area to which access is 
controlled by United States citizen personnel on a 24-hour basis.
    (b) Combinations--(1) Equipment in Service. Combinations to dial-
type, changeable, combination locks shall be changed only by persons 
having an appropriate security clearance, and shall be changed,
    (i) Whenever such equipment is placed in use;
    (ii) Whenever a person knowing the combination no longer requires 
access to it;
    (iii) Whenever a combination has been subjected to possible 
compromise;
    (iv) Whenever the equipment is taken out of service: or
    (v) At least once each year.

Knowledge of combinations shall be limited to the minimum number of 
persons necessary for operating purposes. Records of combinations shall 
be classified no lower than the highest level of classified information 
that is protected by the combination lock. When securing a combination 
lock, the dial must be turned at least four (4) complete times in the 
same direction after closing. Defects in or malfunctioning of storage 
equipment protecting classified national security or officially limited 
information must be reported immediately to the designated office or 
bureau security official for appropriate action.
    (2) Equipment Out of Service. When security equipment, used for the 
storage of classified national security or officially limited 
information, is taken out of service, it shall be physically inspected 
to ensure that no classified information or officialy limited 
information remains therein. Built-in, three-position, dial-type, 
changeable, combination locks shall be reset to the

[[Page 133]]

standard combination 50-25-50 and combination padlocks shall be reset to 
the standard combination 10-20-30. The designated security officer in 
each Treasury bureau and the Departmental Offices shall prescribe such 
supplementary controls deemed necessary to fulfill their individual 
needs to be consistent with Sec. 2.27.
    (3) Security Container Check Sheet. Each piece of security equipment 
used for the storage of classified information will have attached 
conspicuously to the outside a Standard Form 702 (Security Container 
Check Sheet) on which an authorized person will record the date and 
actual time each business day that they initially unlock and finally 
lock the security equipment, followed by their initials. Users of this 
form are to avoid citations which reflect the opening, locking and 
checking of the security equipment at standardized (non-actual) times, 
e.g., opened at 8:00 a.m. and closed/checked at 4:00 p.m. Bureaus and 
the Departmental Offices may continue to use Optional Form 62 (Safe or 
Cabinet Security Record) in lieu of the SF 702 until September 30, 1990, 
or such time as their supplies of Optional Form 62 are exhausted. The 
reprinting or photostatic reproduction and use of Optional Form 62 is 
not authorized. On each normal workday, regardless of whether the 
security equipment was opened on that particular day, the security 
equipment shall be checked by authorized personnel to assure that no 
surreptitious attempt has been made to penetrate the security equipment. 
Such examinations normally consist of a quick or casual visual check to 
note either any obvious marks or gashes, or defects or malfunction of 
the security equipment which are different from their prior observations 
or experience in operating the equipment concerned. Any such 
discrepancies in the appearance of or functioning of the security 
equipment, based upon this visual check, should be reported to 
appropriate security officials. The ``Checked By'' column of the SF 702 
or Optional Form 62 shall be annotated to reflect the date and time of 
this action followed by that person's initials. Security equipment used 
for the storage of classified information that has been opened on a 
particular day shall not be left unattended at the end of that day until 
it has been locked by an authorized person and checked by a second 
person. In the event a second person is not available within the office, 
the individual who locked the equipment shall also annotate the 
``Checked By'' column of the SF 702 or Optional Form 62. Reversible 
``OPEN-CLOSED'' or ``LOCKED-UNLOCKED'' signs, available through normal 
supply channels, shall also be used on such security equipment. The 
respective side of the sign shall be displayed to indicate when the 
container is open or closed. Except for the SF 702 or Optional Form 62, 
the top surface area of security equipment is not to be used for storage 
and must be kept free of extraneous material. SF 702 and/or Optional 
Form 62 shall be utilized on all security equipment used for storing 
information bearing the control legend ``Limited Official Use''. The 
designated security officer in each Treasury bureau and the Department 
Offices may, as warranted, prescribe supplementary use of the SF 702 or 
Optional Form 62 to apply to other authorized legends approved by the 
Department for officially limited information.
    (4) Safe Combination Records. Combinations to security equipment 
containing classified information shall be recorded on Standard Form 700 
(Security Container Information), national stock number 7540-01-214-
5372. Bureaus and the Departmental Offices may continue to use Treasury 
Form 4032 (Security Container Information) in lieu of the SF 700 until 
September 30, 1990, or such time as their supplies of Treasury Form 4032 
are exhausted. The reprinting of Treasury Form 4032 is not authorized. 
Each part of the SF 700 shall be completed in its entirety. The names, 
addresses and home telephone numbers of personnel responsible for the 
combination, and the classified information stored therein, must be 
indicated on part 1 of the SF 700. The completed part 1 shall be posted 
in the front interior of the top, control or locking drawer of the 
security equipment concerned. Part 2 shall be inserted in the envelop 
(part 2A) provided, and forwarded via appropriate secure means to the 
designated bureau

[[Page 134]]

or Departmental Offices central repository for security combinations. 
Part 2 shall have the highest level of classified information, stored in 
the security equipment concerned, annotated in both the top and bottom 
border areas of the completed SF 700. Part 2A shall have the highest 
level of classified information, stored in the security equipment 
concerned, annotated in the blank space immediately above the word, 
``WARNING'' which appears on the SF 700. The completion of the SF 700 or 
Treasury Form 4032 does not constitute a classification action but 
serves as an administrative requirement to ensure the protection of 
classified information stored in such security equipment. SF 700 shall 
be utilized on all security equipment used for storing information 
bearing the control legend ``Limited Official Use''. The designated 
security officer in each Treasury bureau and the Departmental Offices 
may prescribe supplementary use of the SF 700 to apply to other 
authorized legends approved by the Department for officially limited 
information, as warranted.
    (c) Keys. The designated security officer in each Treasury bureau 
and the Departmental Offices shall establish administrative procedures 
for the control and accountability of keys and locks whenever key-
operated, high-security padlocks are utilized. The level of protection 
provided such keys shall be equivalent to that afforded the information 
being protected by the padlock.
    (d) Classified Document Cover Sheets. Classified document cover 
sheets alert personnel that documents or folders are classified and 
require protection from unauthorized scrutiny. Individuals who prepare 
or package classified documents are responsible for affixing the 
appropriate document cover sheet. Orange Standard Form 703 (Top Secret 
Cover Sheet), red SF 704 (Secret Cover Sheet) and blue SF 706 
(Confidential Cover Sheet) are the only authorized cover sheets for 
collateral classified information. The national stock numbers of these 
cover sheets are as follows: SF 703, 7540-01-213-7901; SF 704, 7540-01-
213-7902; and SF 705, 7540-01-213-7903. In order to maintain the 
integrity of the color coding process the photocopying and use of non-
color coded classified document cover sheets is prohibited. Bureaus and 
offices shall maintain a supply of classified document cover sheets 
appropriate for their needs. Classified document cover sheets are 
designed to be reused and will be removed before classified information 
is filed to conserve filing space and prior to the destruction of 
classified information. Document cover sheets are to be used to shield 
classified documents while in use and particularly when the transmission 
is made internally within a headquarters by courier, messenger or by 
personal contact. File folders containing classified information should 
be otherwise marked, e.g., at the top and bottom of the front and back 
covers, to indicate the overall classification of the contents rather 
than permanently affixing the respective classified document cover 
sheet. Treasury Directive 71-02 provides for the use of a green cover 
sheet, TD F 71-01.6 (Limited Official Use Document Cover Sheet) for 
information bearing the control legend ``Limited Official Use''. Bureaus 
or offices electing to create and use other cover sheets for officially 
limited information must obtain prior written approval from the 
Departmental Director of Security.
    (e) Activity Security Checklist. Standard Form 701 (Activity 
Security Checklist) provides a systematic means to make a thorough end-
of-day security inspection for a particular work area and to allow for 
employee accountability in the event that irregularities are discovered. 
Bureaus and the Departmental Offices may include additional information 
on the SF 701 to suit their unique needs. The SF 701, available through 
normal supply channels has a national stock number of 7540-01-213-7900. 
It shall be the only form used in situations that call for use of an 
activity security checklist. Completion, storage and disposition of SF 
701 will be determined by each bureau and the Departmental Offices.



Sec. 2.28  Transmittal [4.1(b)].

    (a) Preparation. Classified information to be transmitted outside of 
a Treasury facility shall be enclosed in opaque inner and outer covers. 
The inner cover shall be a sealed wrapper or

[[Page 135]]

envelope plainly marked with the assigned security classification and 
addresses of both sender and addressee. The outer cover shall be sealed 
and addressed with no identification of the classification of its 
contents. Whenever classified material is to be transmitted and the size 
of the material is not suitable for use of envelopes or similar 
wrappings, it shall be enclosed in two opaque sealed containers, such as 
boxes or heavy wrappings. Material used for packaging such bulk 
classified information shall be of sufficient strength and durability as 
to provide security protection while in transit, to prevent items from 
breaking out of the container, and to facilitate detection of any 
tampering therewith.
    (b) Receipting. A receipt, Treasury Department Form 71-01.5 
(Classified Document Record of Transmittal), shall be enclosed in the 
inner cover, except that Confidential and Limited Official Use 
information shall require a receipt only if the sender deems it 
necessary. The receipt shall identify the sender, addressee and describe 
the document, but shall contain no classified information. It shall be 
immediately signed by the recipient and returned to the sender. Within a 
Treasury facility, such information may be transmitted between offices 
by direct contact of the officials concerned in a single sealed opaque 
envelope with no security classification category being shown on the 
outside of the envelope. Classified information shall never be delivered 
to unoccupied offices or rooms. Senders of classified information should 
maintain appropriate records of outstanding receipts for which return of 
the original signed copy is still pending. TD F's 71-01.5 shall be 
maintained for a three year period after which they may be destroyed. No 
record of the actual destruction of the TD F 71-01.5 is required.
    (c) Transmittal of Top Secret. The transmittal of Top Secret 
information outside of a Treasury facility shall be by specifically 
designated personnel, by State Department diplomatic pouch, by a 
messenger-courier system authorized for that purpose, e.g., Defense 
Courier Service, or over authorized secure communications circuits. Top 
Secret information may not be sent via registered mail.
    (d) Transmittal of Secret. The transmittal of Secret information 
shall be effected in the following manner:
    (1) The 50 States, District of Columbia and Puerto Rico. Secret 
information may be transmitted within and between the 50 States, the 
District of Columbia, and the Commonwealth of Puerto Rico by one of the 
means authorized for Top Secret information, by the United States Postal 
Service registered mail or express mail service; or by protective 
services provided by United States air or surface commercial carriers 
under such conditions as may be prescribed by the Departmental Director 
of Security. United States Postal Service express mail service shall be 
used only when it is the most effective means to accomplish a mission 
within security, time, cost and accountability constraints. To ensure 
direct delivery to the addressee, the ``Waiver of Signature and 
Indemnity'' block on the United States Postal Service Express Mail Label 
11-B may not be executed under any circumstances. All Secret express 
mail shipments are to be processed through mail distribution centers or 
delivered directly to a United States Postal Service facility or 
representative. The use of external (street side) express mail 
collection boxes is prohibited. Only the express mail services of the 
United States Postal Service are authorized.
    (2) Other Areas. Secret information may be transmitted from, to, or 
within areas other than those specified in Sec. 2.28(d)(1) by one of the 
means established for Top Secret information, or by United States 
registered mail through Military Postal Service facilities provided that 
the information does not at any time pass out of United States citizen 
control and does not pass through a foreign postal system. Transmittal 
outside such areas may also be accomplished under escort of 
appropriately cleared personnel aboard United States Government owned 
and United States Government contract vehicles or aircraft, ships of the 
United States Navy, civil service manned United States Naval ships, and 
ships of United States Registry. Operators of

[[Page 136]]

vehicles, captains or masters of vessels, and pilots of aircraft who are 
United States citizens, and who are appropriately cleared, may be 
designated as escorts. Secret information may not be sent via certified 
mail.
    (e) Transmittal of Confidential and Limited Official Use 
Information. Confidential and Limited Official Use information shall be 
transmitted within and between the 50 States, the District of Columbia, 
the Commonwealth of Puerto Rico, and United States territories or 
possessions by one of the means established for higher classifications, 
or by the United States Postal Service registered mail. Outside these 
areas, confidential and Limited Official Use information shall be 
transmitted only as is authorized for higher classifications. 
Confidential and Limited Official Use information may not be sent via 
certified mail.
    (f) Hand Carrying of Classified Information in Travel Status--(1) 
General Provisions. Personnel in travel status shall physically 
transport classified information across international boundaries only 
when absolutely essential. Whenever possible, and when time permits, the 
most desirable way to transmit classified information to the location 
being visited is by other authorized means identified in Sec. 2.28 (c), 
(d) and (e). The physical transportation of classified information on 
non-United States flag aircraft should be avoided if possible. Treaury 
Directive 71-03, ``Screening of Airline Passengers Carrying Classified 
Information or Material'' provides specifics on the requirements for 
transporting classified information.
    (2) Specific Safeguards. If it is determined that the transportation 
of classified information by an individual in travel status is in the 
best interest of the United States Government, the following specific 
safeguards shall be fulfilled:
    (i) Classified information shall be in the physical possession of 
the individual and shall have adequate safeguards at all times if proper 
storage at a United States Government facility is not available. Under 
no circumstances shall classified information be stored in a hotel safe 
or room, locked in automobiles, private residences, train compartments, 
or any vehicular detachable storage compartments.
    (ii) An inventory of all Top Secret classified information, 
including teletype messages, shall be made prior to departure and a copy 
of same shall be retained by the traveller's office until the 
traveller's return at which time all Top Secret classified information 
shall be accounted for. These same procedures are recommended for 
information classified Secret, Confidential or Limited Official Use.
    (iii) Classified information shall never be displayed or used in any 
manner in public conveyances or rooms. First class or business travel is 
not authorized when the justification for commercially available 
transportation is based on the need for reviewing classified materials 
while enroute. Travelers are responsible for reviewing and familiarizing 
themselves with required classified materials, under appropriately 
secure circumstances, in advance of their travel and not during such 
travel.
    (iv) In order to avoid unnecessary delays in the screening process 
prior to boarding commercial air carriers, the traveler shall have in 
his or her possession written authorization, on Treasury or bureau 
letterhead, to transport classified information and either an 
identification card or credential bearing both a photograph and 
descriptive data. Courier authorizations shall be signed by an 
appropriate security representative authorized to direct official 
travel. This courier authorization, along with official travel orders, 
shall, in most instances, permit the individual to exempt the classified 
information from inspection. If difficulty is encountered, the traveler 
should tactfully refuse to exhibit or disclose the classified 
information to inspection and should insist on the assistance of the 
local United States diplomatic representative at the port of entry or 
departure.
    (v) Upon completion of the visit, the traveler shall have the 
information returned to his or her office by approved means. All Top 
Secret and Secret classified information, including teletype messages 
transported for the purpose of the visit shall be accounted for. It is 
highly recommended that Confidential

[[Page 137]]

and Limited Official Use information also be accounted for. If any Top 
Secret or Secret classified items are left with the office being visited 
for its retention and use, the individual shall obtain a receipt.

[55 FR 1644, Jan. 17, 1990, as amended at 55 FR 50321, Dec. 6, 1990]



Sec. 2.29  Telecommunications and computer transmissions.

    Classified information shall not be communicated by 
telecommunications or computer transmissions except as may be authorized 
with respect to the transmission of classified information over 
authorized secure communications circuits or systems.



Sec. 2.30  Special access programs [1.2(a) and 4.2(a)].

    Only the Secretary of the Treasury may create or continue a special 
access program if:
    (a) Normal management and safeguarding procedures do not limit 
access sufficiently; and
    (b) The number of persons with access is limited to the minimum 
necessary to meet the objective of providing extra protection for the 
information.



Sec. 2.31  Reproduction controls [4.1(b)].

    (a) Top Secret documents, except for the controlled initial 
distribution of information processed or received electronically, shall 
not be reproduced without the consent of the originator.
    (b) Unless restricted by the originating agency, Secret, 
Confidential and Limited Official Use documents may be reproduced to the 
extent required by operational needs.
    (c) Reproductions of classified documents shall be subject to the 
same accountability and controls as the original documents.
    (d) Paragraphs (a) and (b) of this section shall not restrict the 
reproduction of documents to facilitate review for possible 
declassification.



Sec. 2.32  Loss or possible compromise [4.1(b)].

    (a) Report of Loss or Possible Compromise. Any Treasury employee who 
has knowledge of the loss or possible compromise or classified 
information shall immediately report the circumstances to their 
designated office or bureau security officer who shall take appropriate 
action to assess the degree of damage. In turn, the Departmental 
Director of Security shall be immediately notified by the affected 
office or bureau security officer of such reported loss or possible 
compromise. The Departmental Director of Security shall also notify the 
department or agency which originated the information and any other 
interested department or agency so that a damage assessment may be 
conducted and appropriate measures taken to negate or minimize any 
adverse effect of the loss or possible compromise. Compromises may occur 
through espionage, unauthorized disclosures to the press or other 
members of the public, publication of books and treatises, the known 
loss of classified information or equipment to foreign powers, or 
through various other circumstances.
    (b) Inquiry. The Departmental Director of Security shall notify the 
Assistant Secretary (Management) who shall then direct an immediate 
inquiry to be conducted for the purpose of taking corrective measures 
and assessing damages. Based on the results of this inquiry, it may be 
deemed appropriate to notify the Inspector General who shall determine 
whether the Office of the Inspector General or a Treasury bureau will 
conduct any additional investigation. Upon completion of the 
investigation by the Inspector General, the Inspector General shall 
recommend to the Assistant Secretary (Management) and concurrently to 
the Departmental Director of Security, the appropriate administrative, 
disciplinary, or legal action to be taken based upon jurisdictional 
authority of the Treasury components involved.
    (c) Content of Damage Assessments. At a minimum, damage assessments 
shall be in writing and contain the following:
    (1) Identification of the source, date and circumstances of the 
compromise.
    (2) Classification and description of the specific information which 
has been lost.

[[Page 138]]

    (3) An analysis and statement of the known or probable damage to the 
national security that has resulted or may result.
    (4) An assessment of the possible advantage to foreign powers 
resulting from the compromise.
    (5) An assessment of whether,
    (i) The classification of the information involved should be 
continued without change;
    (ii) The specific information, or parts thereof, shall be modified 
to minimize or nullify the effects of the reported compromise and the 
classification retained;
    (iii) Downgrading, declassification, or upgrading is warranted, and 
if so, confirmation of prompt notification to holders of any change, and
    (6) An assessment of whether countermeasures are appropriate and 
feasible to negate or minimize the effect of the compromise.
    (d) System for Control of Damage Assessments. Each Treasury bureau 
and the Departmental Offices shall establish a system of control and 
internal procedures to ensure that damage assessments are performed in 
all cases described in Sec. 2.32(a) and that records are maintained in a 
manner that facilitates their retrieval and use within the Department.
    (e) Cases Involving More Than One Agency. (1) Whenever a compromise 
involves the classified information or interests of more than one 
agency, the Departmental Director of Security shall advise the other 
affected agencies of the circumstances and findings that affect their 
information or interests. Whenever a damage assessment, incorporating 
the product of two or more agencies is needed, the affected agencies 
shall agree upon the assignment of responsibility for the assessment and 
Treasury components will provide all data pertinent to the compromise to 
the agency responsible for conducting the assessment.
    (2) Whenever a compromise of United States classified information is 
the result of actions taken by foreign nationals, by foreign government 
officials, or by United States nationals in the employ of international 
organizations, the agency performing the damage assessment shall 
endeavor to ensure through appropriate intergovernmental liaison 
channels, that information pertinent to the assessment is obtained. 
Whenever more than one agency is responsible for the assessment, those 
agencies shall coordinate the request prior to transmittal through 
appropriate channels.
    (3) Whenever an action is contemplated against any person believed 
responsible for the loss or compromise of classified information, damage 
assessments shall be coordinated with appropriate legal counsel. 
Whenever a violation of criminal law appears to have occured and a 
criminal prosecution is contemplated, coordination shall be made with 
the Department of Justice.
    (4) The designated representative of the Director of Central 
Intelligence, or other appropriate officials with responsibility for the 
information involved, will be consulted whenever a compromise of 
sensitive compartmented information has occurred.



Sec. 2.33  Responsibilities of holders [4.1(b)].

    Any person having access to and possession of classified information 
is responsible for protecting it from persons not authorized access, 
i.e., persons who do not possess an appropriate security clearance, and 
who do not possess the required need-to-know. This includes keeping 
classified documents under constant observation and turned face-down or 
covered when not in use and securing such information in approved 
security equipment or facilities whenever it is not under the direct 
supervision of authorized persons. In all instances, such protective 
means must meet accountability requirements prescribed by the 
Department.



Sec. 2.34  Inspections [4.1(b)].

    Individuals charged with the custody of classified information shall 
conduct the necessary inspections within their areas to ensure adherence 
to procedural safeguards prescribed to protect classified information. 
Security officers shall ensure that periodic inspections are made to 
determine whether procedural safeguards prescribed by this regulation 
and any bureau implementing regulation are in effect at all

[[Page 139]]

times. At a minimum such checks shall ensure that all classified 
information is stored in approved security containers, including 
removable storage media, e.g., floppy disks used by word processors that 
contain classified information; burn bags, if utilized, are either 
stored in approved security containers or destroyed; and classified 
shorthand notes, carbon paper, carbon and plastic typewriter ribbons, 
rough drafts and similar papers have been properly stored or destroyed.



Sec. 2.35  Security violations.

    Any individual, at any level of employment, determined to have been 
responsible for the unauthorized release or disclosure or potential 
release or disclosure of classified national security information, 
whether it be knowingly, willfully or through negligence, shall be 
notified on TD F 71-21.1 (Record of Security Violation) that his or her 
action is in violation of this regulation, the Order, the Directive, and 
Executive Order 10450, as amended. Treasury Directive 71-04, entitled, 
``Administration of Security Violations'' sets forth provisions 
concerning security violations which shall apply to each Treasury 
employee and persons under contract or subcontract to the Department 
authorized access to Treasury classified national security information.
    (a) Repeated abuse of the classification process, either by 
unnecessary or over-classification, or repeated failure, neglect or 
disregard of established requirements for safeguarding classified 
information by any employee shall be grounds for appropriate adverse or 
disciplinary action. Such actions may include, but are not necessarily 
limited to, a letter of warning, a letter of reprimand, suspension 
without pay, or dismissal, as appropriate in the particular case, under 
applicable personnel rules, regulations and procedures. Where a 
violation of criminal statutes may be involved, any such case shall be 
promptly referred to the Department of Justice.
    (b) After an affirmative adjudication of a security violation, and 
as the occasion demands, reports of accountable security violations 
shall be placed in the employee's personnel security file, and as 
appropriate, in the employee's official personnel folder. The security 
official of the office or bureau concerned shall recommend to the 
respective management official or bureau head that disciplinary action 
be taken when such action is indicated.



Sec. 2.36  Disposition and destruction [4.1(b)].

    Classified information no longer needed in current working files or 
for reference or record purposes shall be processed for appropriate 
disposition in accordance with the provisions of Title 44, United States 
Code, Chapters 21 and 33, which govern disposition of Federal records. 
Classified information approved for destruction shall be destroyed by 
either burning, melting, chemical decomposition, pulping, mulching, 
pulverizing, cross-cut shredding or other mutilation in the presence of 
appropriately cleared and authorized persons. The method of destruction 
must preclude recognition or reconstruction of the classified 
information. The residue from cross-cut shredding of Top Secret, Secret, 
and Confidential classified, non-Communications Security (COMSEC), 
information contained in paper media may not exceed \3/32\" by \1/2\" 
with a \1/64\" tolerance.
    (a) Diskettes or Floppy Disks. Diskettes or floppy disks containing 
information or data classified up to and including Top Secret may be 
destroyed by the use of an approved degausser, burning, pulverizing, and 
chemical decomposition, or by first reformatting or reinitializing the 
diskette then physically removing the magnetic disk from its protective 
sleeve and using an approved cross-cut shredder to destroy the magnetic 
media. Care must be exercised to ensure that the destruction of magnetic 
disks does not damage the cross-cut shredder. The residue from such 
destruction, however, may not exceed \1/32\" by \1/2\" with a \1/64\" 
tolerance. The destruction of classified COMSEC information on diskettes 
or floppy disks may only be effected by burning followed by crushing of 
the ash residue.
    (b) Hard Disks. Hard disks, including removable hard disks, disk 
packs, drums or single disk platters that contain classified information 
must first

[[Page 140]]

be degaussed prior to physical destruction. The media must be destroyed 
by incineration, chemical decomposition or the entire magnetic disk 
pack, drum, or platter recording surface must be obliterated by use of 
an emery wheel or disk sander.
    (c) Approval of Use of Mulching and Cross-cut Shredding Equipment. 
Prior to obtaining mulching or cross-cut shredding equipment, the 
Departmental Director of Security shall approve the use of such 
equipment.
    (d) Use of Burnbags. Any classified information to be destroyed by 
burning shall be torn and placed in opaque containers, commonly 
designated as burnbags, which shall be clearly and distinctly labeled 
``BURN'' or ``CLASSIFIED WASTE''. Burnbags awaiting destruction are to 
be protected by security safeguards commensurate with the classification 
or control designation of the information involved.
    (e) Records of Destruction. Appropriate accountability records shall 
be maintained on TD F 71-01.17 (Classified Document Certificate of 
Destruction) to reflect the destruction of all Top Secret and Secret 
information. As deemed necessary by the originator, or as required by 
special regulations, the TD F 71-01.17 shall be executed for the 
destruction of information classified Confidential or marked Limited 
Official Use. TD F's 71-01.17 shall be maintained for a three-year 
period after which the form may be destroyed. No record of the actual 
destruction of the TD F 71-01.17 is required.
    (f) Destruction of non-record Classified Information. Non-record 
classified information such as extra copies and duplicates, including 
shorthand notes, preliminary drafts, used carbon paper and other 
material of similar temporary nature, shall also be destroyed by 
burning, mulching, or cross-cut shredding as soon as it has served its 
purpose, but no records of such destruction need be maintained.

[55 FR 1644, Jan. 17, 1990; 55 FR 5118, Feb. 13, 1990]



Sec. 2.37  National Security Decision Directive 197.

    National Security Decision Directive 197, Reporting Hostile Contacts 
and Security Awareness, provides that United States Government employees 
are responsible for reporting to their designated security officer:
    (a) Any suspected or apparent attempt by persons, regardless of 
nationality, to obtain unauthorized access to classified national 
security information, sensitive or proprietary information or technology 
and/or;
    (b) Instances in which they feel they are being targeted for 
possible exploitation. Contacts with representatives of designated 
countries of concern identified in Sec. 2.43(f) which involve requests 
for information which are not ordinarily provided in the course of an 
employee's job, regular or daily activity, and/or which might possibly 
lead to further requests for access to sensitive, proprietary or 
classified information or technology, are to be reported to designated 
security officers. Reports of such contacts are to be forwarded by the 
designated security officer to the Departmental Director of Security for 
appropriate action and coordination.



                  Subpart E--Implementation and Review



Sec. 2.38  Departmental management.

    (a) The Assistant Secretary (Management) shall:
    (1) Enforce the Order, the Directive and this regulation, and 
establish, coordinate and maintain active training, orientation and 
inspection programs for employees concerned with classified information.
    (2) Review suggestions and complaints regarding the administration 
of this regulation.
    (b) Pursuant to Treasury Directive 71-08, ``Delegation of Authority 
Concerning Physical Security Programs'', the Departmental Director of 
Security shall:
    (1) Review all bureau implementing regulations prior to publication 
and shall require any regulation to be changed, if it is not consistent 
with the Order, the Directive or this regulation.
    (2) Have the authority to conduct on-site reviews of bureau physical 
security programs and information security programs as they pertain to 
each Treasury bureau and to require such

[[Page 141]]

reports, information and assistance as may be necessary, and
    (3) Serve as the principal advisor to the Assistant Secretary 
(Management) with respect to Treasury physical and information security 
programs.



Sec. 2.39  Bureau administration.

    Each Treasury bureau and the Departmental Offices shall designate, 
in writing to the Departmental Director of Security, an officer or 
official to direct, coordinate and administer its physical security and 
information security programs which shall include active oversight to 
ensure effective implementation of the Order, the Directive, this 
regulation. Bureaus and the Departmental Offices shall revise their 
existing implementing regulation on national security information to 
ensure conformance with this regulation. Time frames for bureau and 
Departmental Offices implementation shall be established by the 
Departmental Director of Security.



Sec. 2.40  Emergency planning [4.1(b)].

    Each Treasury bureau and the Departmental Offices shall develop 
plans for the protection, removal, or destruction of classified 
information in case of fire, natural disaster, civil disturbance, or 
possible enemy action. These plans shall include the disposition of 
classified information located in foreign countries.



Sec. 2.41  Emergency authority [4.1(b)].

    The Secretary of the Treasury may prescribe by regulation special 
provisions for the dissemination, transmittal, destruction, and 
safeguarding of national security information during combat or other 
emergency situations which pose an imminent threat to national security 
information.



Sec. 2.42  Security education [5.3(a)].

    Each Treasury bureau that creates, processes or handles national 
secutity information, including the Departmental Offices, is required to 
establish a security education program. The program shall be sufficient 
to familiarize all necessary personnel with the provisions of the Order, 
the Directive, this regulation and any other implementing directives and 
regulations to impress upon them their individual security 
responsibilities. The program shall also provide for initial, refresher, 
and termination briefings.
    (a) Briefing of Employees. All new employees concerned with 
classified information shall be afforded a security briefing regarding 
the Order, the Directive and this regulation and sign a security 
agreement as required in Sec. 2.22(c). Employees concerned with 
sensitive compartmented information shall be required to read and also 
sign a security agreement. Copies of applicable laws and pertinent 
security regulations setting forth the procedures for the protection and 
disclosure of classified information shall be available for all new 
employees afforded a security briefing. All employees given a security 
briefing shall be required to sign a TD F 71-01.16 (Physical Security 
Orientation Acknowledgment) which shall be maintained on file as 
determined by respective office or bureau security officials.
    (b) [Reserved]



                      Subpart F--General Provisions



Sec. 2.43  Definitions [6.1].

    (a) Authorized Person. Those individuals who have a ``need-to-know'' 
the classified information involved and have been cleared for the 
receipt of such information. Responsibility for determining whether 
individuals' duties require that they possess, or have access to, any 
classified information and whether they are authorized to receive it 
rests on the individual who has possession, knowledge, or control of the 
information involved, and not on the prospective recipients.
    (b) Compromise. The loss of security enabling unauthorized access to 
classified information. Affected information or material is not 
automatically declassified.
    (c) Confidential Source. Any individual or organization that has 
provided, or that may reasonably be expected to provide, information to 
the United States on matters pertaining to the national security with 
the expectation, expressed or implied, that the information or 
relationship, or both, be held in confidence.

[[Page 142]]

    (d) Declassification. The determination that particular classified 
information no longer requires protection against unauthorized 
disclosure in the interest of national security. Such determination 
shall be by specific action or occur automatically after the lapse of a 
requisite period of time or the occurrence of a specified event. If such 
determination is by specific action, the information or material shall 
be so marked with the new designation.
    (e) Derivative Classification. A determination that information is, 
in substance, the same as informaiton that is currently classified and a 
designation of the level of classification.
    (f) Designated Countries of Concern. For purposes of National 
Security Decision Directive 197 reporting: Afghanistan, Albania, Angola, 
Bulgaria, Cambodia (Kampuchea), the People's Republic of China 
(Communist China), Cuba, Czechoslovakia, Ethiopia, East Germany (German 
Democratic Republic including the Soviet sector of Berlin), Hungary, 
Iran, Iraq, Laos, Libya, Mongolian People's Republic (Outer Mongolia), 
Nicaragua, North Korea, Palestine Liberation Organization, Poland, 
Romania, South Africa, South Yemen, Syria, Taiwan, Union of Soviet 
Socialist Republics (Russia), Vietnam and Yugoslavia.
    (g) Document. Any recorded information regardless of its physical 
form or characteristics, including, without limitation, written or 
printed material; data processing cards and tapes; maps, charts; 
painting; drawings; engravings; sketches; working notes and papers; 
reproductions of such things by any means or process; and sound, voice, 
or electronic recordings in any form.
    (h) Foreign Government Information. (1) Information provided by a 
foreign government or governments, an international organization of 
governments, or any elements thereof with the expectation, expressed or 
implied, that the information, the source of the information, or both, 
are to be held in confidence; or
    (2) Information produced by the United States Government pursuant to 
or as a result of a joint arrangement with a foreign government or 
governments or an international organization of governments, or any 
element thereof, requiring that the information, the arrangement, or 
both, are to be held in confidence.
    (i) Information. Any data or material, regardless of its physical 
form or characteristics, that is owned by, produced by or for, or is 
under the control of the United States Government.
    (j) Information Security. The administrative policies and procedures 
for identifying, controlling, and safeguarding from unauthorized 
disclosure, information the protection of which is authorized by 
Executive Order or statute.
    (k) Intelligence Activity. An activity that an agency within the 
Intelligence Community is authorized to conduct pursuant to Executive 
Order 12333.
    (l) Intelligence Sources and Methods. A person, organization, or 
technical means or method which provides foreign intelligence or foreign 
counterintelligence to the United States and which, if its identity or 
capability is disclosed, is vulnerable to counteraction that could 
nullify or significantly reduce its effectiveness in providing foreign 
intelligence or foreign counterintelligence to the United States. An 
intelligence source also means a person or organization which provides 
foreign intelligence or foreign counterintelligence to the United States 
only on the condition that its identity remains undisclosed. 
Intelligence methods are that which, if disclosed, reasonably could lead 
to the disclosure of an intelligence source or operation.
    (m) Limited Official Use. The legend authorized for ``Officially 
Limited Information'' which provides that it be handled, safeguarded and 
stored in a manner equivalent to national security information 
classified Confidential.
    (n) Multiple Classified Sources. The term used to indicate that a 
document is derivatively classified when it contains classified 
information derived from other than one source.
    (o) National Security. The national defense or foreign relations of 
the United States.
    (p) National Security Information. Information that has been 
determined

[[Page 143]]

pursuant to the Order or any predecessor Executive Order to require 
protection against unauthorized disclosure and that is so designated.
    (q) Need-to-Know. A determination made by the possessor of 
classified information that a prospective recipient, in the interest of 
national security, has a requirement for access to, knowledge of, or 
possession of the classified information in order to perform tasks or 
services essential to the fulfillment of particular work, including 
performance on contracts for which such access is required.
    (r) Officially Limited Information. Information which does not meet 
the criterion that unauthorized disclosure would at least cause damage 
to the national security under the Order or a predecessor Executive 
Order, but which concerns important, delicate, sensitive or proprietary 
information which is utilized in the development of Treasury policy. 
This includes the enforcement of criminal and civil laws relating to 
Treasury operations, the making of decisions on personnel matters and 
the consideration of financial information provided in confidence.
    (s) Original Classification. An initial determination that 
information requires, in the interest of national security, protection 
against unauthorized disclosure, together with a classification 
designation signifying the level of protection required.
    (t) Original Classification Authority. The authority vested in an 
Executive Branch official to make an initial determination that 
information requires protection against unauthorized disclosure in the 
interest of national security.
    (u) Originating Agency. The agency responsible for the initial 
determination that particular information is classified.
    (v) Portion. A segment of a document for purposes of expressing a 
unified theme; ordinarily a paragraph.
    (w) Sensitive Compartmented Information. Information and material 
concerning or derived from intelligence sources, methods, or analytical 
processes, that requires special controls for restricting handling 
within compartmented intelligence systems established by the Director of 
Central Intelligence and for which compartmentation is established.
    (x) Special Access Program. Any program imposing ``need-to-know'' or 
access controls beyond those normally provided for access to 
Confidential, Secret, or Top Secret information. Such a program may 
include, but is not limited to, special clearance, adjudication, or 
investigative requirements, special designations of officials authorized 
to determine ``need-to-know'' or special lists of persons determined to 
have a ``need-to-know''.
    (y) Special Activity. An activity conducted in support of national 
foreign policy objectives abroad which is planned and executed so that 
the role of the United States Government is not apparent or acknowledged 
publicly, and functions in support of such activity, but which is not 
intended to influence United States political processes, public opinion, 
policies or media and does not include diplomatic activities or the 
collection and production of intelligence or related support functions.
    (z) Unauthorized Disclosure. A communication or physical transfer of 
classified information to an unauthorized recipient. It includes the 
unauthorized disclosure of classified information in a newspaper, 
journal, or other publication where such information is traceable due to 
a direct quotation or other uniquely identifiable fact.



PART 3--CLAIMS REGULATIONS AND INDEMNIFICATION OF DEPARTMENT OF TREASURY EMPLOYEES--Table of Contents




           Subpart A--Claims Under the Federal Tort Claims Act

Sec.
3.1  Scope of regulations.
3.2  Filing of claims.
3.3  Legal review.
3.4  Approval of claims not in excess of $25,000.
3.5  Limitations on authority to approve claims.
3.6  Final denial of a claim.
3.7  Action on approved claims.
3.8  Statute of limitations.

              Subpart B--Claims Under the Small Claims Act

3.20  General.

[[Page 144]]

3.21  Action by claimant.
3.22  Legal review.
3.23  Approval of claims.
3.24  Statute of limitations.

     Subpart C--Indemnification of Department of Treasury Employees

3.30  Policy.

    Authority: 28 U.S.C. 2672; 28 CFR part 14; 5 U.S.C. 301.

    Source: 35 FR 6429, Apr. 22, 1970, unless otherwise noted.



           Subpart A--Claims Under the Federal Tort Claims Act



Sec. 3.1  Scope of regulations.

    (a) The regulations in this part shall apply to claims asserted 
under the Federal Tort Claims Act, as amended, 28 U.S.C. 2672, accruing 
on or after January 18, 1967, for money damages against the United 
States for injury to or loss of property or personal injury or death 
caused by the negligent or wrongful act or omission of an employee of 
the Department while acting within the scope of his office or 
employment, under circumstances where the United States if a private 
person, would be liable to the claimant for such damage, loss, injury, 
or death, in accordance with the law of the place where the act or 
omission occurred. The regulations in this subpart do not apply to any 
tort claims excluded from the Federal Tort Claims Act, as amended, under 
28 U.S.C. 2680.
    (b) Unless specifically modified by the regulations in this part, 
procedures and requirements for filing and handling claims under the 
Federal Tort Claims Act shall be in accordance with the regulations 
issued by the Department of Justice, at 28 CFR part 14, as amended.



Sec. 3.2  Filing of claims.

    (a) When presented. A claim shall be deemed to have been presented 
upon the receipt from a claimant, his duly authorized agent or legal 
representative of an executed Standard Form 95 or other written 
notification of an incident, accompanied by a claim for money damages in 
a sum certain for injury to or loss of property, or personal injury, or 
death alleged to have occurred by reason of the incident.
    (b) Place of filing claim. Claims shall be submitted directly or 
through the local field headquarters to the head of the bureau or office 
of the Department out of whose activities the incident occurred, if 
known; or if not known, to the General Counsel, Treasury Department, 
Washington, DC 20220.
    (c) Contents of claim. The evidence and information to be submitted 
with the claim shall conform to the requirements of 28 CFR 14.4.



Sec. 3.3  Legal review.

    Any claim that exceeds $500, involves personal injuries or 
automobile damage, or arises out of an incident that is likely to result 
in multiple claimants, shall be forwarded to the legal division of the 
bureau or office out of whose activities the claim arose. The claim, 
together with the reports of the employee and the investigation, shall 
be reviewed in the legal division which shall thereupon make a 
recommendation that the claim be approved, disapproved, or compromised, 
and shall advise on the need for referral of the claim to the Department 
of Justice. This recommendation and advice, together with the file, 
shall be forwarded to the head of the bureau or office or his designee.

[35 FR 6429, Apr. 22, 1970, as amended at 48 FR 16253, Apr. 15, 1983]



Sec. 3.4  Approval of claims not in excess of $25,000.

    (a) Claims not exceeding $25,000 and not otherwise requiring 
consultation with the Department of Justice pursuant to 28 CFR 14.6(b) 
shall be approved, disapproved, or compromised by the head of the bureau 
or office or his designee, taking into consideration the recommendation 
of the legal division.



Sec. 3.5  Limitations on authority to approve claims.

    (a) All proposed awards, compromises or settlements in excess of 
$25,000 require the prior written approval of the Attorney General.
    (b) All claims which fall within the provisions of 28 CFR 14.6(b) 
require referral to and consultation with the Department of Justice.
    (c) Any claim which falls within paragraph (a) or (b) of this 
section

[[Page 145]]

shall be reviewed by the General Counsel. If the claim, award, 
compromise, or settlement receives the approval of the General Counsel 
and the head of the bureau or office or his designee, a letter shall be 
prepared for the signature of the General Counsel transmitting to the 
Assistant Attorney General, Civil Division, Department of Justice, the 
case for approval or consultation as required by 28 CFR 14.6. Such 
letter shall conform with the requirements set forth in 28 CFR 14.7.



Sec. 3.6  Final denial of a claim.

    The final denial of an administrative claim shall conform with the 
requirements of 28 CFR 14.9 and shall be signed by the head of the 
bureau or office, or his designee.



Sec. 3.7  Action on approved claims.

    (a) Any award, compromise, or settlement in an amount of $2,500 or 
less shall be processed for payment from the appropriations of the 
bureau or office out of whose activity the claim arose.
    (b) Payment of an award, compromise, or settlement in excess of 
$2,500 and not more than $100,000 shall be obtained by the bureau or 
office by forwarding Standard Form 1145 to the Claims Division, General 
Accounting Office.
    (c) Payment of an award, compromise, or settlement in excess of 
$100,000 shall be obtained by the bureau by forwarding Standard Form 
1145 to the Bureau of Government Financial Operations, Department of the 
Treasury, which will be responsible for transmitting the award, 
compromise, or settlement to the Bureau of the Budget for inclusion in a 
deficiency appropriation bill.
    (d) When an award is in excess of $25,000, Standard Form 1145 must 
be accompanied by evidence that the award, compromise, or settlement has 
been approved by the Attorney General or his designee.
    (e) When the use of Standard Form 1145 is required, it shall be 
executed by the claimant. When a claimant is represented by an attorney, 
the voucher for payment shall designate both the claimant and his 
attorney as payees; the check shall be delivered to the attorney, whose 
address shall appear on the voucher.
    (f) Acceptance by the claimant, his agent, or legal representative, 
of any award, compromise or settlement made pursuant to the provisions 
of section 2672 or 2677 of title 28, United States Code, shall be final 
and conclusive on the claimant, his agent or legal representative and 
any other person on whose behalf or for whose benefit the claim has been 
presented, and shall constitute a complete release of any claim against 
the United States and against any employee of the Government whose act 
or omission gave rise to the claim, by reason of the same subject 
matter.

[35 FR 6429, Apr. 22, 1970, as amended at 39 FR 19470, June 3, 1974]



Sec. 3.8  Statute of limitations.

    Claims under this subpart must be presented in writing to the 
Department within 2 years after the claim accrued.



              Subpart B--Claims Under the Small Claims Act



Sec. 3.20  General.

    The Act of December 28, 1922, 42 Stat. 1066, the Small Claims Act, 
authorized the head of each department and establishment to consider, 
ascertain, adjust, and determine claims of $1,000 or less for damage to, 
or loss of, privately owned property caused by the negligence of any 
officer or employee of the Government acting within the scope of his 
employment. The Federal Tort Claims Act superseded the Small Claims Act 
with respect to claims that are allowable under the former act. 
Therefore, claims that are not allowable under the Federal Tort Claims 
Act, for example, claims arising abroad, may be allowable under the 
Small Claims Act.



Sec. 3.21  Action by claimant.

    Procedures and requirements for filing claims under this section 
shall be the same as required for filing claims under the Federal Tort 
Claims Act as set forth in Subpart A of this part.

[[Page 146]]



Sec. 3.22  Legal review.

    Claims filed under this subpart shall be forwarded to the legal 
division of the bureau or office out of whose activities the claim 
arose. The claim, together with the reports of the employee and the 
investigation, shall be reviewed in the legal division which shall 
thereupon make a recommendation that the claim be approved, disapproved 
or compromised.



Sec. 3.23  Approval of claims.

    Claims shall be approved, disapproved, or compromised by the head of 
the bureau or office or his designee, taking into consideration the 
recommendation of the legal division.



Sec. 3.24  Statute of limitations.

    No claim will be considered under this subpart unless filed within 1 
year from the date of the accrual of said claim.



     Subpart C--Indemnification of Department of Treasury Employees

    Source: 56 FR 42938, Aug. 30, 1991, unless otherwise noted.



Sec. 3.30  Policy.

    (a) The Department of the Treasury may indemnify, in whole or in 
part, a Department employee (which for purposes of this regulation shall 
include a former employee) for any verdict, judgment or other monetary 
award rendered against such employee, provided the Secretary or his or 
her designee determines that (1) the conduct giving rise to such 
verdict, judgment or award was within the scope of his or her employment 
and (2) such indemnification is in the interest of the Department of the 
Treasury.
    (b) The Department of the Treasury may pay for the settlement or 
compromise of a claim against a Department employee at any time, 
provided the Secretary or his or her designee determines that (1) the 
alleged conduct giving rise to the claim was within the scope of the 
employee's employment and (2) such settlement or compromise is in the 
interest of the Department of the Treasury.
    (c) Absent exceptional circumstances, as determined by the Secretary 
or his or her designee, the Department will not entertain a request to 
indemnify or to pay for settlement of a claim before entry of an adverse 
judgment, verdict or other determination.
    (d) When a Department employee becomes aware that he or she has been 
named as a party in a proceeding in his or her individual capacity as a 
result of conduct within the scope of his or her employment, the 
employee should immediately notify his or her supervisor that such an 
action is pending. The supervisor shall promptly thereafter notify the 
chief legal officer of the employee's employing component. The employee 
shall immediately apprise the chief legal officer of his or her 
employing component of any offer to settle the proceeding.
    (e) A Department employee may request indemnification to satisfy a 
verdict, judgment or monetary award entered against the employee or to 
compromise a claim pending against the employee. The employee shall 
submit a written request, with appropriate documentation including a 
copy of the verdict, judgment, award or other order or settlement 
proposal, in a timely manner to the Secretary or his or her designee for 
decision.
    (f) Any payment under this section either to indemnify a Department 
employee or to settle a claim shall be contingent upon the availability 
of appropriated funds for the payment of salaries and expenses of the 
employing component.



PART 4--EMPLOYEES' PERSONAL PROPERTY CLAIMS--Table of Contents




    Authority: 31 U.S.C. 3721(j).

    Source: 62 FR 18518, Apr. 16, 1997, unless otherwise noted.



Sec. 4.1  Procedures.

    The procedures for filing a claim with the Treasury Department for 
personal property that is lost or damaged incident to service are 
contained in Treasury Directive 32-13, ``Claims for Loss or Damage to 
Personal Property,'' and Treasury Department Publication

[[Page 147]]

32-13, ``Policies and Procedures For Employees' Claim for Loss or Damage 
to Personal Property Incident to Service.''



PART 5--CLAIMS COLLECTION--Table of Contents




   Subpart A--Administrative Collection, Compromise, Termination and 
                           Referral of Claims

Sec.
5.1  Authority.
5.2  Incorporation by reference; scope.
5.3  Designation.
5.4  Application to other statutes.

                        Subpart B--Salary Offset

5.5  Purpose.
5.6  Scope.
5.7  Designation.
5.8  Definitions.
5.9  Applicability of regulations.
5.10  Waiver requests and claims to the General Accounting Office.
5.11  Notice requirements before offset.
5.12  Hearing.
5.13  Certification.
5.14  Voluntary repayment agreements as alternative to salary offset.
5.15  Special review.
5.16  Notice of salary offset.
5.17  Procedures for salary offset.
5.18  Coordinating salary offset with other agencies.
5.19  Interest, penalties and administrative costs.
5.20  Refunds.
5.21  Request for the services of a hearing official from the creditor 
          agency.
5.22  Non-waiver of rights by payments.

                      Subpart C--Tax Refund Offset

5.23  Applicability and scope.
5.24  Designation.
5.25  Definitions.
5.26  Preconditions for Department participation.
5.27  Procedures.
5.28  Referral of debts for offset.
5.29  Notice requirements before offset.

                    Subpart D--Administrative Offset

5.30  Scope of regulations.
5.31  Designation.
5.32  Definitions.
5.33  General.
5.34  Notification procedures.
5.35  Agency review.
5.36  Written agreement for repayment.
5.37  Administrative offset.
5.38  Jeopardy procedure.



   Subpart A--Administrative Collection, Compromise, Termination and 
                           Referral of Claims

    Authority: 31 U.S.C. 3711.

    Source: 32 FR 452, Jan. 17, 1967, unless otherwise noted.



Sec. 5.1  Authority.

    The regulations of this part are issued under section 3 of the 
Federal Claims Collection Act of 1966, Pub. L. 89-508, 80 Stat. 308, 
309, and in conformity with the Joint Regulations issued under that Act 
by the General Accounting Office and the Department of Justice 
prescribing standards for administrative collection, compromise, 
termination of agency collection action, and referral to the General 
Accounting Office and to the Department of Justice for litigation, of 
civil claims by the Government for money or property, 4 CFR Chapter II.



Sec. 5.2  Incorporation by reference; scope.

    The regulations of this part incorporate by this reference all 
provisions of the Joint Regulations of the General Accounting Office and 
the Department of Justice, and supplement those regulations by the 
prescription of procedures and directives necessary and appropriate for 
Treasury operations. The Joint Regulations and this part do not apply to 
tax claims nor to any claim as to which there is an indication of fraud 
or misrepresentation, as described in Sec. 101.3 of the Joint 
Regulations, unless returned by the Justice Department to the Treasury 
Department for handling.



Sec. 5.3  Designation.

    The heads of bureaus and offices and their delegates are designated 
as designees of the Secretary of the Treasury authorized to perform all 
the duties for which the Secretary is responsible under the foregoing 
Act and Joint Regulations: Provided, however, That no compromise of a 
claim shall be effected or collection action terminated, except upon the 
recommendation of the General Counsel, the Chief Counsel of the bureau 
or office concerned, or the designee of either. Notwithstanding the

[[Page 148]]

foregoing proviso, no such recommendation shall be required with respect 
to the termination of collection activity on any claim in which the 
unpaid amount of the debt is $300 or less.

(Sec. 3, 80 Stat. 309; 31 U.S.C. 951-953, 4 CFR Chap. II; 31 U.S.C. 
3711, 96 Stat. 971 (1982))

[34 FR 5159, Mar. 13, 1969, as amended at 49 FR 45579, Nov. 19, 1984]



Sec. 5.4  Application to other statutes.

    (a) The authority of the Secretary of the Treasury or the head of a 
bureau or office within the Treasury Department to compromise claims of 
the United States shall be exercised with respect to claims not 
exceeding $20,000, exclusive of interest, in conformity with the Federal 
Claims Collection Act, the Joint Regulations thereunder, and this part, 
except where standards are established by other statutes or authorized 
regulations issued pursuant thereto.
    (b) The authority of the Secretary of the Treasury or the head of a 
bureau or office within the Treasury Department to remit or mitigate a 
fine, penalty or forfeiture shall be exercised in accordance with the 
standards for remission or mitigation established in the governing 
statute or in Departmental enforcement policies. In the absence of such 
standards, the standards of the Joint Regulations shall be followed to 
the extent applicable.



                        Subpart B--Salary Offset

    Authority: 5 U.S.C. 5514; 5 CFR part 550, subpart K.

    Source: 52 FR 39514, Oct. 22, 1987, unless otherwise noted.



Sec. 5.5  Purpose.

    The purpose of the Debt Collection Act of 1982, (Pub. L. 97-365), is 
to provide a comprehensive statutory approach to the collection of debts 
due the Federal Government. These regulations implement section 5 of the 
Act which authorizes the collection of debts owed by Federal employees 
to the Federal Government by means of salary offsets, except that no 
claim may be collected by such means if outstanding for more than 10 
years after the agency's right to collect the debt first accrued, unless 
facts material to the Government's right to collect were not known and 
could not reasonably have been known by the official or officials who 
were charged with the responsibility for discovery and collection of 
such debts. These regulations are consistent with the regulations on 
salary offset published by the Office of Personnel Management (OPM) on 
July 3, 1984, codified in Subpart K of part 550 of title 5 of the Code 
of Federal Regulations.



Sec. 5.6  Scope.

    (a) These regulations provide Departmental procedures for the 
collection by salary offset of a Federal employee's pay to satisfy 
certain debts owed the Government.
    (b) These regulations apply to collections by the Secretary of the 
Treasury from:
    (1) Federal employees who owe debts to the Department; and
    (2) Employees of the Department who owe debts to other agencies.
    (c) These regulations do not apply to debts or claims arising under 
the Internal Revenue Code of 1954, as amended (26 U.S.C. 1 et seq.); the 
Social Security Act (42 U.S.C. 301 et seq.); the tariff laws of the 
United States; or to any case where collection of a debt by salary 
offset is explicitly provided for or prohibited by another statute 
(e.g., travel advances in 5 U.S.C. 5705 and employee training expenses 
in 5 U.S.C. 4108).
    (d) These regulations do not apply to any adjustment to pay arising 
out of an employee's election of coverage or a change in coverage under 
a Federal benefits program requiring periodic deductions from pay, if 
the amount to be recovered was accumulated over four pay periods or 
less.
    (e) Nothing in these regulations precludes the compromise, 
suspension, or termination of collection actions where appropriate under 
the standards implementing the Federal Claims Collection Act (31 U.S.C. 
3711 et seq., 4 CFR parts 101-105, 38 CFR 1.1900 et seq.).



Sec. 5.7  Designation.

    The heads of bureaus and offices and their delegates are designated 
as designees of the Secretary of the Treasury authorized to perform all 
the duties for

[[Page 149]]

which the Secretary is responsible under the foregoing act and Office of 
Personnel Management Regulations: Provided, however, That no compromise 
of a claim shall be effected or collection action terminated, except 
upon the recommendation of the General Counsel, the Chief Counsel of the 
bureau or office concerned, or the designee of either. Notwithstanding 
the foregoing provision, no such recommendation shall be required with 
respect to the termination of collection activity on any claim in which 
the unpaid amount of the debt is $300 or less.



Sec. 5.8  Definitions.

    As used in this part (except where the context clearly indicates, or 
where the term is otherwise defined elsewhere in this part) the 
following definitions shall apply:
    (a) Agency means:
    (1) An Executive Agency as defined by section 105 of Title 5, United 
States Code, including the U.S. Postal Service and the U.S. Postal Rate 
Commission;
    (2) A military department as defined by section 102 of Title 5, 
United States Code;
    (3) An agency or court of the judicial branch including a court as 
defined in section 610 of Title 28, United States Code, the District 
Court for the Northern Mariana Islands and the Judicial Panel on 
Multidistrict Litigation;
    (4) An agency of the legislative branch, including the U.S. Senate 
and the U.S. House of Representatives; and
    (5) Other independent establishments that are entities of the 
Federal Government.
    (b) Bureau Salary Offset Coordination Officer means an official 
designated by the head of each bureau who is responsible for 
coordinating debt collection activities for the bureau. The Secretary 
shall designate a bureau salary offset coordinator for the Departmental 
offices.
    (c) Certification means a written debt claim form received from a 
creditor agency which requests the paying agency to offset the salary of 
an employee.
    (d) Creditor agency means an agency of the Federal Government to 
which the debt is owed.
    (e) Debt or claim means money owed by an employee of the Federal 
Government to an agency of the Federal Government from sources which 
include loans insured or guaranteed by the United States and all other 
amounts due the Government from fees, leases, rents, royalties, 
services, sales of real or personal property, overpayments, penalties, 
damages, interests, fines and forfeitures (except those arising under 
the Uniform Code of Military Justice) and all other similar sources.
    (f) Department or Treasury Department means the Departmental Offices 
of the Department of the Treasury and each bureau of the Department.
    (g) Disposable pay means that part of current basic pay, special 
pay, incentive pay, retired pay, retainer pay, or, in the case of an 
employee not entitled to basic pay, other authorized pay remaining after 
the deduction of any amount required by law to be withheld. The 
Department shall allow the following deductions in determining 
disposable pay subject to salary offset:
    (1) Federal employment taxes;
    (2) Amounts deducted for the U.S. Soldiers' and Airmen's Home;
    (3) Fines and forfeiture ordered by a court martial or by a 
commanding officer;
    (4) Federal, state or local income taxes no greater than would be 
the case if the employee claimed all dependents to which he or she is 
entitled and such additional amounts for which the employee presents 
evidence of a tax obligation supporting the additional withholding;
    (5) Health insurance premiums;
    (6) Normal retirement contributions (e.g., Civil Service Retirement 
deductions, Survivor Benefit Plan or Retired Serviceman's Family 
Protection Plan); and
    (7) Normal life insurance premiums, exclusive of optional life 
insurance premiums (e.g., Serviceman's Group Life Insurance and 
``basic'' Federal Employee's Group Life Insurance premiums).
    (h) Employee means a current employee of the Treasury Department or 
other agency, including a current member of the Armed Forces or Reserve 
of the Armed Forces of the United States.

[[Page 150]]

    (i) Federal Claims Collection Standards, ``FCCS,'' jointly published 
by the Department of Justice and the General Accounting Office at 4 CFR 
101.1 et seq.
    (j) Hearing official means an individual responsible for conducting 
any hearing with respect to the existence or amount of a debt claimed, 
and rendering a decision on the basis of such hearing. A hearing 
official may not be under the supervision or control of the Secretary of 
the Department of the Treasury when Treasury is the creditor agency.
    (k) Paying agency means the agency of the Federal Government which 
employs the individual who owes a debt to an agency of the Federal 
Government. In some cases, the Department may be both the creditor and 
the paying agency.
    (l) Notice of intent to offset or notice of intent means a written 
notice from a creditor agency to an employee which alleges that the 
employee owes a debt to the creditor agency and apprising the employee 
of certain administrative rights.
    (m) Notice of salary offset means a written notice from the paying 
agency to an employee after a certification has been issued by a 
creditor agency, informing the employee that salary offset will begin at 
the next officially established pay interval.
    (n) Payroll office means the payroll office in the paying agency 
which is primarily responsible for the payroll records and the 
coordination of pay matters with the appropriate personnel office with 
respect to an employee. Payroll office, with respect to the Department 
of the Treasury means the payroll offices of each bureau and the Office 
of the Assistant Secretary of the Treasury for Management for the 
Departmental Offices.
    (o) Salary offset means an administrative offset to collect a debt 
under 5 U.S.C. 5514 by deduction(s) at one or more officially 
established pay intervals from the current pay account of an employee, 
without his or her consent.
    (p) Secretary means the Secretary of the Treasury or his or her 
designee.
    (q) Waiver means the cancellation, remission, forgiveness, or non-
recovery of a debt allegedly owed by an employee to the Department or 
another agency as permitted or required by 5 U.S.C. 5584 or 8346(b), 10 
U.S.C. 2774, 32 U.S.C. 716, or any other law.



Sec. 5.9  Applicability of regulations.

    These regulations are to be followed in instances where:
    (a) The Department is owed a debt by an individual currently 
employed by another agency;
    (b) Where the Department is owed a debt by an individual who is a 
current employee of the Department; or
    (c) Where the Department currently employs an individual who owes a 
debt to another Federal Agency. Upon receipt of proper certification 
from the creditor agency, the Department will offset the debtor-
employee's salary in accordance with these regulations.



Sec. 5.10  Waiver requests and claims to the General Accounting Office.

    These regulations do not preclude an employee from requesting waiver 
of an overpayment under 5 U.S.C. 5584 or 8346(b), 10 U.S.C. 2774, 32 
U.S.C. 716, or in any way questioning the amount or validity of a debt 
by submitting a subsequent claim to the General Accounting Office in 
accordance with the procedures prescribed by the General Accounting 
Office. These regulations also do not preclude an employee from 
requesting a waiver pursuant to other statutory provisions pertaining to 
the particular debts being collected.



Sec. 5.11  Notice requirements before offset.

    (a) Deductions under the authority of 5 U.S.C. 5514 shall not be 
made unless the creditor agency provides the employee with written 
notice that he/she owes a debt to the Federal Government, a minimum of 
30 calendar days before salary offset is initiated. When Treasury is the 
creditor agency this notice of intent to offset an employee's salary 
shall be hand-delivered or sent by certified mail to the most current 
address that is available to the Department and will state:
    (1) That the Secretary has reviewed the records relating to the 
claim and has determined that a debt is owed, the amount of the debt, 
and the facts giving rise to the debt;

[[Page 151]]

    (2) The Secretary's intention to collect the debt by means of 
deduction from the employee's current disposable pay account until the 
debt and all accumulated interest is paid in full;
    (3) The amount, frequency, approximate beginning date, and duration 
of the intended deductions;
    (4) An explanation of the Department's policy concerning interest, 
penalties and administrative costs including a statement that such 
assessments must be made unless excused in accordance with the Federal 
Claims Collection Standards, 4 CFR 101.1 et seq.;
    (5) The employee's right to inspect and copy all records of the 
Department pertaining to the debt claimed or to receive copies of such 
records if personal inspection is impractical;
    (6) The right to a hearing conducted by an impartial hearing 
official (an administrative law judge, or alternatively, a hearing 
official not under the supervision or control of the Secretary) with 
respect to the existence and amount of the debt claimed, or the 
repayment schedule (i.e., the percentage of disposable pay to be 
deducted each pay period), so long as a petition is filed by the 
employee as prescribed in Sec. 5.12;
    (7) If not previously provided, the opportunity (under terms 
agreeable to the Department) to establish a schedule for the voluntary 
repayment of the debt or to enter into a written agreement to establish 
a schedule for repayment of the debt in lieu of offset. The agreement 
must be in writing, signed by both the employee and the creditor agency 
(4 CFR 102.2(e));
    (8) The name, address and phone number of an officer or employee of 
the Department who may be contacted concerning procedures for requesting 
a hearing;
    (9) The method and time period for requesting a hearing;
    (10) That the timely filing of a petition for a hearing on or before 
the fifteenth calendar day following receipt of such notice of intent 
will stay the commencement of collection proceedings;
    (11) The name and address of the office to which the petition should 
be sent;
    (12) That the Department will initiate certification procedures to 
implement a salary offset, as appropriate, (which may not exceed 15 
percent of the employee's disposable pay) not less than thirty (30) days 
from the date of receipt of the notice of debt, unless the employee 
files a timely petition for a hearing;
    (13) That a final decision on the hearing (if one is requested) will 
be issued at the earliest practical date, but not later than sixty (60) 
days after the filing of the petition requesting the hearing, unless the 
employee requests and the hearing official grants a delay in the 
proceedings;
    (14) That any knowingly false or frivolous statements, 
representations, or evidence may subject the employee to:
    (i) Disciplinary procedures appropriate under Chapter 75 of Title 5, 
United States Code, part 752 of title 5, Code of Federal Regulations, or 
any other applicable statute or regulations;
    (ii) Penalties under the False Claims Act, sections 3729-3731 of 
Title 31, United States Code or any other applicable statutory 
authority; and
    (iii) Criminal penalties under sections 286, 287, 1001, and 1002 of 
Title 18, United States Code or any other applicable statutory 
authority;
    (15) Any other rights and remedies available to the employee under 
statutes or regulations governing the program for which the collection 
is being made;
    (16) That unless there are applicable contractual or statutory 
provisions to the contrary, that amounts paid on or deducted for the 
debt which are later waived or found not owed to the United States will 
be promptly refunded to the employee (5 U.S.C. 5514); and
    (17) Proceedings with respect to such debt are governed by section 5 
of the Debt Collection Act of 1982 (5 U.S.C. 5514).
    (b) The Department is not required to comply with paragraph (a) of 
this section for any adjustment to pay arising out of an employee's 
election of coverage or a change in coverage under a Federal benefits 
program requiring periodic deductions from pay if the amount to be 
recovered was accumulated over four pay periods or less.

[[Page 152]]



Sec. 5.12  Hearing.

    (a) Request for hearing. Except as provided in paragraph (b) of this 
section, an employee who desires a hearing concerning the existence or 
amount of the debt or the proposed offset schedule must send such a 
request to the office designated in the notice of intent. See 
Sec. 5.11(a)(8). The request (or petition) for hearing must be received 
by the designated office on or before the fifteenth (15) calendar day 
following receipt of the notice. The employee must also specify whether 
an oral or paper hearing is requested. If an oral hearing is desired, 
the request should explain why the matter cannot be resolved by review 
of the documentary evidence alone.
    (b) Failure to timely submit. If the employee files a petition for a 
hearing after the expiration of the fifteen (15) calendar day period 
provided for in paragraph (a) of this section, the Department should 
accept the request if the employee can show that the delay was the 
result of circumstances beyond his or her control or because of a 
failure to receive actual notice of the filing deadline (unless the 
employee had actual notice of the filing deadline).
    (1) An employee waives the right to a hearing, and will have his or 
her disposable pay offset in accordance with the Department's offset 
schedule, if the employee:
    (i) Fails to file a request for a hearing unless such failure is 
excused; or
    (ii) Fails to appear at an oral hearing of which he or she was 
notified unless the hearing official determines failure to appear was 
due to circumstances beyond the employee's control (5 U.S.C. 5514).
    (c) Representation at the hearing. The creditor agency may be 
represented by legal counsel. The employee may represent himself or 
herself or may be represented by an individual of his or her choice and 
at his or her own expense.
    (d) Review of departmental records related to the debt. (1) In 
accordance with 5.11(a)(5), an employee who intends to inspect or copy 
creditor agency records related to the debt must send a letter to the 
official designated in the notice of intent to offset stating his or her 
intention. The letter must be received within fifteen (15) calendar days 
after receipt of the notice.
    (2) In response to a timely request submitted by the debtor, the 
designated official will notify the employee of the location and time 
when the employee may inspect and copy records related to the debt.
    (3) If personal inspection is impractical, arrangements shall be 
made to send copies of such records to the employee.
    (e) Hearing official. Unless the Department appoints an 
administrative law judge to conduct the hearing, the Department must 
obtain a hearing official who is not under the supervision or control of 
the Secretary of the Treasury.
    (f) Obtaining the services of a hearing official when the Department 
is the creditor agency. (1) When the debtor is not a Department 
employee, and in the event that the Department cannot provide a prompt 
and appropriate hearing before an administrative law judge or before a 
hearing official furnished pursuant to another lawful arrangement, the 
Department may contact an agent of the paying agency designated in 
Appendix A to part 581 of title 5, Code of Federal Regulations or as 
otherwise designated by the agency, and request a hearing official.
    (2) When the debtor is a Department employee, the Department may 
contact any agent of another agency designated in Appendix A to part 581 
of title 5, Code of Federal Regulations or otherwise designated by that 
agency, to request a hearing official.
    (g) Procedure. (1) After the employee requests a hearing, the 
hearing official or administrative law judge shall notify the employee 
of the form of the hearing to be provided. If the hearing will be oral, 
notice shall set forth the date, time and location of the hearing. If 
the hearing will be paper, the employee shall be notified that he or she 
should submit arguments in writing to the hearing official or 
administrative law judge by a specified date after which the record 
shall be closed. This date shall give the employee reasonable time to 
submit documentation.

[[Page 153]]

    (2) Oral hearing. An employee who requests an oral hearing shall be 
provided an oral hearing if the hearing official or administrative law 
judge determines that the matter cannot be resolved by review of 
documentary evidence alone (e.g., when an issue of credibility or 
veracity is involved). The hearing is not an adversarial adjudication, 
and need not take the form of an evidentiary hearing. Oral hearings may 
take the form of, but are not limited to:
    (i) Informal conferences with the hearing official or administrative 
law judge, in which the employee and agency representative will be given 
full opportunity to present evidence, witnesses and argument;
    (ii) Informal meetings with an interview of the employee; or
    (iii) Formal written submissions, with an opportunity for oral 
presentation.
    (3) Paper hearing. If the hearing official or administrative law 
judge determines that an oral hearing is not necessary, he or she will 
make the determination based upon a review of the available written 
record (5 U.S.C. 5514).
    (4) Record. The hearing official must maintain a summary record of 
any hearing provided by this subpart. See 4 CFR 102.3. Witnesses who 
testify in oral hearings will do so under oath or affirmation.
    (h) Date of decision. The hearing official or administrative law 
judge shall issue a written opinion stating his or her decision, based 
upon documentary evidence and information developed at the hearing, as 
soon as practicable after the hearing, but not later than sixty (60) 
days after the date on which the petition was received by the creditor 
agency, unless the employee requests a delay in the proceedings. In such 
case the sixty (60) day decision period shall be extended by the number 
of days by which the hearing was postponed.
    (i) Content of decision. The written decision shall include:
    (1) A statement of the facts presented to support the origin, 
nature, and amount of the debt;
    (2) The hearing official's findings, analysis and conclusions; and
    (3) The terms of any repayment schedules, if applicable.
    (j) Failure to appear. In the absence of good cause shown (e.g., 
excused illness), an employee who fails to appear at a hearing shall be 
deemed, for the purpose of this subpart, to admit the existence and 
amount of the debt as described in the notice of intent. If the 
representative of the creditor agency fails to appear, the hearing 
official shall proceed with the hearing as scheduled, and make his/her 
determination based upon the oral testimony presented and the 
documentary documentation submitted by both parties. At the request of 
both parties, the hearing official shall schedule a new hearing date. 
Both parties shall be given reasonable notice of the time and place of 
this new hearing.



Sec. 5.13  Certification.

    (a) The bureau salary offset coordination officer shall provide a 
certification to the paying agency in all cases where:
    (1) The hearing official determines that a debt exists;
    (2) The employee admits the existence and amount of the debt by 
failing to request a hearing; or
    (3) The employee admits the existence of the debt by failing to 
appear at a hearing.
    (b) The certification must be in writing and must state:
    (1) The employee owes the debt;
    (2) The amount and basis of the debt;
    (3) The date the Government's right to collect the debt first 
accrued;
    (4) The Department's regulations have been approved by OPM pursuant 
to 5 CFR part 550, subpart K;
    (5) The amount and date of the lump sum payment;
    (6) If the collection is to be made in installments, the number of 
installments to be collected, the amount of each installment, and the 
commencing date of the first installment, if a date other than the next 
officially established pay period is required; and
    (7) The dates the action(s) was taken and that it was taken pursuant 
to 5 U.S.C. 5514.

[[Page 154]]



Sec. 5.14  Voluntary repayment agreements as alternative to salary offset.

    (a) In response to a notice of intent to an employee may propose to 
repay the debt as an alternative to salary offset. Any employee who 
wishes to repay a debt without salary offset shall submit in writing a 
proposed agreement to repay the debt. The proposal shall admit the 
existence of the debt and set forth a proposed repayment schedule. Any 
proposal under this subsection must be received by the official 
designated in that notice within fifteen (15) calendar days after 
receipt of the notice of intent.
    (b) When the Department is the creditor agency and in response to a 
timely proposal by the debtor, the Secretary will notify the employee 
whether the employee's proposed written agreement for repayment is 
acceptable. It is within the Secretary's discretion to accept a 
repayment agreement instead of proceeding by offset.
    (c) If the Secretary decides that the proposed repayment agreement 
is unacceptable, the employee will have fifteen (15) days from the date 
he or she received notice of the decision to file a petition for a 
hearing.
    (d) If the Secretary decides that the proposed repayment agreement 
is acceptable, the alternative arrangement must be in writing and signed 
by both the employee and the Secretary.



Sec. 5.15  Special review.

    (a) An employee subject to salary offset or a voluntary repayment 
agreement, may, at any time, request a special review by the creditor 
agency of the amount of the salary offset or voluntary payment, based on 
materially changed circumstances such as, but not limited to 
catastrophic illness, divorce, death, or disability.
    (b) In determining whether an offset would prevent the employee from 
meeting essential subsistence expenses (costs incurred for food, 
housing, clothing, transportation and medical care), the employee shall 
submit a detailed statement and supporting documents for the employee, 
his or her spouse and dependents indicating:
    (1) Income from all sources;
    (2) Assets;
    (3) Liabilities;
    (4) Number of dependents;
    (5) Expenses for food, housing, clothing and transportation;
    (6) Medical expenses; and
    (7) Exceptional expenses, if any.
    (c) If the employee requests a special review under this section, 
the employee shall file an alternative proposed offset or payment 
schedule and a statement, with supporting documents, showing why the 
current salary offset or payments result in an extreme financial 
hardship to the employee.
    (d) The Secretary shall evaluate the statement and supporting 
documents, and determine whether the original offset or repayment 
schedule imposes an extreme financial hardship on the employee. The 
Secretary shall notify the employee in writing of such determination, 
including, if appropriate, a revised offset or payment schedule.
    (e) If the special review results in a revised offset or repayment 
schedule, the bureau salary offset coordination officer shall provide a 
new certification to the paying agency.



Sec. 5.16  Notice of salary offset.

    (a) Upon receipt of proper certification of the creditor agency, the 
bureau payroll office will send the employee a written notice of salary 
offset. Such notice shall, at a minimum:
    (1) Contain a copy of the certification received from the creditor 
agency; and
    (2) Advise the employee that salary offset will be initiated at the 
next officially established pay interval.
    (b) The bureau payroll office shall provide a copy of the notice to 
the creditor agency and advise such agency of the dollar amount to be 
offset and the pay period when the offset will begin.



Sec. 5.17  Procedures for salary offset.

    (a) The Secretary shall coordinate salary deductions under this 
subpart.
    (b) The appropriate bureau payroll office shall determine the amount 
of an employee's disposable pay and will implement the salary offset.
    (c) Deductions shall begin within three official pay periods 
following receipt by the payroll office of certification.

[[Page 155]]

    (d) Types of collection--(1) Lump-sum payment. If the amount of the 
debt is equal to or less than 15 percent of disposable pay, such debt 
generally will be collected in one lump-sum payment.
    (2) Installment deductions. Installment deductions will be made over 
a period not greater than the anticipated period of employment. The size 
and frequency of installment deductions will bear a reasonable relation 
to the size of the debt and the employee's ability to pay. However, the 
amount deducted from any period will not exceed 15 percent of the 
disposable pay from which the deduction is made unless the employee has 
agreed in writing to the deduction of a greater amount.
    (3) Lump-sum deductions from final check. A lump-sum deduction 
exceeding the 15 percent disposable pay limitation may be made from any 
final salary payment pursuant to 31 U.S.C. 3716 in order to liquidate 
the debt, whether the employee is being separated voluntarily or 
involuntarily.
    (4) Lump-sum deductions from other sources. Whenever an employee 
subject to salary offset is separated from the Department, and the 
balance of the debt cannot be liquidated by offset of the final salary 
check, the Department, pursuant to 31 U.S.C. 3716, may offset any later 
payments of any kind against the balance of the debt.
    (e) Multiple debts. In instances where two or more creditor agencies 
are seeking salary offsets, or where two or more debts are owed to a 
single creditor agency, the bureau payroll office may, at its 
discretion, determine whether one or more debts should be offset 
simultaneously within the 15 percent limitation.
    (f) Precedence of debts owed to Treasury. For Treasury employees, 
debts owed to the Department generally take precedence over debts owed 
to other agencies. In the event that a debt to the Department is 
certified while an employee is subject to a salary offset to repay 
another agency, the bureau payroll office may decide whether to have 
that debt repaid in full before collecting its claim or whether changes 
should be made in the salary deduction being sent to the other agency. 
If debts owed the Department can be collected in one pay period, the 
bureau payroll office may suspend the salary offset to the other agency 
for that pay period in order to liquidate the Department's debt. When an 
employee owes two or more debts, the best interests of the Government 
shall be the primary consideration in the determination by the payroll 
office of the order of the debt collection.



Sec. 5.18  Coordinating salary offset with other agencies.

    (a) Responsibility of the Department as the creditor agency. (1) The 
Secretary shall coordinate debt collections and shall, as appropriate:
    (i) Arrange for a hearing upon proper petition by a Federal 
employee; and
    (ii) Prescribe, upon consultation with the General Counsel, such 
practices and procedures as may be necessary to carry out the intent of 
this regulation.
    (2) The head of each bureau shall designate a salary offset 
coordination officer who will be responsible for:
    (i) Ensuring that each notice of intent to offset is consistent with 
the requirements of Sec. 5.11;
    (ii) Ensuring that each certification of debt sent to a paying 
agency is consistent with the requirements of Sec. 5.13;
    (iii) Obtaining hearing officials from other agencies pursuant to 
Sec. 5.12(f); and
    (iv) Ensuring that hearings are properly scheduled.
    (3) Requesting recovery from current paying agency. Upon completion 
of the procedures established in these regulations and pursuant to 5 
U.S.C. 5514, the Department must:
    (i) Certify, in writing, that the employee owes the debt, the amount 
and basis of the debt, the date on which payment(s) is due, the date the 
Government's right to collect the debt first accrued, and that the 
Department's regulations implementing 5 U.S.C. 5514 have been approved 
by the Office of Personnel Management;
    (ii) Advise the paying agency of the action(s) taken under 5 U.S.C. 
5514(b) and give the date(s) the action(s) was taken (unless the 
employee has consented to the salary offset in writing or signed a 
statement acknowledging receipt of the required procedures and the 
written consent or statement is forwarded to the paying agency);

[[Page 156]]

    (iii) Except as otherwise provided in this paragraph, submit a debt 
claim containing the information specified in paragraphs (a)(3) (i) and 
(ii) of this section and an installment agreement (or other instruction 
on the payment schedule), if applicable, to the employee's paying 
agency;
    (iv) If the employee is in the process of separating, the Department 
must submit its debt claim to the employee's paying agency for 
collection as provided in Sec. 5.12. The paying agency must certify the 
total amount of its collection and notify the creditor agency and the 
employee as provided in paragraph (b)(4) of this section. If the paying 
agency is aware that the employee is entitled to payments from the Civil 
Service Retirement Fund and Disability Fund, or other similar payments, 
it must provide written notification to the agency responsible for 
making such payments that the debtor owes a debt (including the amount) 
and that the provisions of his section have been fully complied with. 
However, the Department must submit a properly certified claim to the 
agency responsible for making such payments before the collection can be 
made.
    (v) If the employee is already separated and all payments due from 
his or her former paying agency have been paid, the Department may 
request, unless otherwise prohibited, that money due and payable to the 
employee from the Civil Service Retirement Fund and Disability Fund (5 
CFR 831.1801 et seq.) or other similar funds, be administratively offset 
to collect the debt (See 31 U.S.C. 3716 and the FCCS).
    (4) When an employee transfers to another paying agency, the 
Department shall not repeat the due process procedures described in 5 
U.S.C. 5514 and this subpart to resume the collection. The Department 
must review the debt upon receiving the former paying agency's notice of 
the employee's transfer to make sure the collection is resumed by the 
paying agency.
    (b) Responsibility of the Department as the paying agency--(1) 
Complete claim. When the Department receives a certified claim from a 
creditor agency, deductions should be scheduled to begin at the next 
officially established pay interval. The employee must receive written 
notice that the Department has received a certified debt claim from the 
creditor agency (including the amount) and written notice of the date 
salary offset will begin and the amount of such deductions.
    (2) Incomplete claim. When the Department receives an incomplete 
certification of debt from a creditor agency, the Department must return 
the debt claim with notice that procedures under 5 U.S.C. 551 and this 
subpart must be provided and a properly certified debt claim received 
before action will be taken to collect from the employee's current pay 
account.
    (3) Review. The Department is not authorized to review the merits of 
the creditor agency's determination with respect to the amount or 
validity of the debt certified by the creditor agency.
    (4) Employees who transfer from one paying agency to another. If, 
after the creditor agency has submitted the debt claim to the 
Department, the employee transfers to a different agency before the debt 
is collected in full, the Department must certify the total amount 
collected on the debt. One copy of the certification must be furnished 
to the employee and one copy to the creditor agency along with notice of 
the employee's transfer.



Sec. 5.19  Interest, penalties and administrative costs.

    (a) The Department shall assess interest, penalties and 
administrative costs on debts owed pursuant to 31 U.S.C. 3717 and 4 CFR 
101.1 et seq.



Sec. 5.20  Refunds.

    (a) In instances where the Department is the creditor agency, it 
shall promptly refund any amount deducted under the authority of 5 
U.S.C. 5514 when:
    (1) The debt is waived or otherwise found not to be owing the United 
States; or
    (2) An administrative or judicial order directs the Department to 
make a refund.
    (b) Unless required or permitted by law or contract, refunds under 
this subsection shall not bear interest.

[[Page 157]]



Sec. 5.21  Request for the services of a hearing official from the creditor agency.

    (a) The Department will provide a hearing official upon request of 
the creditor agency when the debtor is employed by the Department and 
the creditor agency cannot provide a prompt and appropriate hearing 
before an administrative law judge or before a hearing official 
furnished pursuant to another lawful arrangement.
    (b) The Department will provide a hearing official upon request of a 
creditor agency when the debtor works for the creditor agency and that 
agency cannot arrange for a hearing official.
    (c) The bureau salary offset coordination officer will appoint 
qualified personnel to serve as hearing officials.
    (d) Services rendered under this section will be provided on a fully 
reimbursable basis pursuant to the Economy Act of 1932, as amended, 31 
U.S.C. 1535.



Sec. 5.22  Non-waiver of rights by payments.

    An employee's involuntary payment of all or any portion of a debt 
being collected under this Subpart must not be construed as a waiver of 
any rights which the employee may have under 5 U.S.C. 5514 or any other 
provisions of a written contract or law unless there are statutory or 
contractual provisions to the contrary.



                      Subpart C--Tax Refund Offset

    Authority: 31 U.S.C. 3720A; 26 CFR 301.6402-6T.

    Source: 52 FR 50, Jan. 2, 1987, unless otherwise noted.



Sec. 5.23  Applicability and scope.

    (a) These regulations implement 31 U.S.C. 3720A which authorizes the 
IRS to reduce a tax refund by the amount of a past-due legally 
enforceable debt owed to the United States.
    (b) For purposes of this section, a past-due legally enforceable 
debt referable to the IRS is a debt which is owed to the United States 
and:
    (1) Except in the case of a judgment debt, has been delinquent for 
at least three months and will not have been delinquent more than ten 
years at the time the offset is made;
    (2) Cannot be currently collected pursuant to the salary offset 
provisions of 5 U.S.C. 5514;
    (3) Is ineligible for administrative offset under 31 U.S.C. 3716(a) 
by reason of 31 U.S.C. 3716(c)(2) or cannot be collected by 
administrative offset under 31 U.S.C. 3716(a) by the referring agency 
against amounts payable to the debtor by the referring agency;
    (4) With respect to which the bureau has given the taxpayer at least 
sixty (60) days to present evidence that all or part of the debt is not 
past-due or legally enforceable, has considered evidence presented by 
such taxpayer, and determined that an amount of such debt is past-due 
and legally enforceable;
    (5) Which, in the case of a debt to be referred to the Service after 
June 30, 1986, has been disclosed by the bureau to a consumer reporting 
agency as authorized by 31 U.S.C. 3711(f), unless the consumer reporting 
agency would be prohibited from reporting information concerning the 
debt by reason of 15 U.S.C. 1681c;
    (6) With respect to which the Department has notified or has made a 
reasonable attempt to notify the taxpayer that:
    (i) The debt is past due, and
    (ii) Unless repaid within 60 days thereafter, the debt will be 
referred to the IRS for offset against any overpayment of tax; and
    (7) Is at least $25.



Sec. 5.24  Designation.

    The heads of bureaus and their delegates are designated as designees 
of the Secretary of the Treasury authorized to perform all the duties 
for which the Secretary is responsible under the foregoing statutes and 
IRS Regulations: Provided, however, That no compromise of a claim shall 
be effected or collection action terminated, except upon the 
recommendation of the bureau Chief Counsel or his or her designee. 
Notwithstanding the foregoing proviso, no such recommendation shall be 
required with respect to the termination of collection activity on any 
claim in which the unpaid amount of the debt is $300 or less.

[[Page 158]]



Sec. 5.25  Definitions.

    For purposes of this subpart:
    Commissioner means the Commissioner of the Internal Revenue Service.
    Debt means money owed by an individual from sources which include 
loans insured or guaranteed by the United States and all other amounts 
due the U.S. from fees, leases, rents, royalties, services, sales of 
real or personal property, overpayments, penalties, damages, interest, 
fines, forfeitures (except those arising under the Uniform Code of 
Military Justice), administrative costs and all other similar sources.
    Memorandum of Understanding (MOU or agreement) means the agreement 
between the IRS and the individual bureaus which prescribes the specific 
conditions the bureaus must meet before the IRS will accept referrals 
for tax refund offsets.



Sec. 5.26  Preconditions for Department participation.

    (a) The Department, through the individual bureaus, will provide 
information to the Service within the time frame prescribed by the 
Commissioner of the IRS to enable the Commissioner to make a final 
determination as to the each bureau's participation in the tax refund 
offset program. Such information shall include a description of:
    (1) The size and age of the bureau's inventory of delinquent debts;
    (2) The prior collection efforts that the inventory reflects; and
    (3) The quality controls the bureau maintains to assure that any 
debt the bureau may submit for tax refund offset will be valid and 
enforceable.
    (b) In accordance with the timetable specified by the Commissioner, 
the bureau will submit test magnetic media to the IRS, in such form and 
containing such data as the IRS shall specify.
    (c) The bureau shall establish a toll free telephone number that the 
IRS will furnish to individuals whose refunds have been offset to obtain 
information from the bureau concerning the offset.
    (d) The bureau shall enter into a separate agreement with the IRS to 
provide for reimbursement of the Service's cost of administering the 
pilot tax refund offset program in 1987.



Sec. 5.27  Procedures.

    (a) The bureau head or his or her designee shall be the point of 
contact with the IRS for administrative matters regarding the offset 
program.
    (b) The bureaus shall ensure that:
    (1) Only those past-due legally enforceable debts described in 
Sec. 5.23(b) are forwarded to the IRS for offset; and
    (2) The procedures prescribed in the MOU between the bureau and the 
IRS are followed in developing past-due debt information and submitting 
the debts to the IRS.
    (c) The bureau shall submit a notification of a taxpayer's liability 
for past-due legally enforceable debt to the IRS on magnetic media as 
prescribed by the IRS. Such notification shall contain:
    (1) The name and taxpayer identifying number (as defined in section 
6109 of the Internal Revenue Code) of the individual who is responsible 
for the debt;
    (2) The dollar amount of such past-due and legally enforceable debt;
    (3) The date on which the original debt became past-due;
    (4) The designation of the referring bureau submitting the 
notification of liability and identification of the referring agency 
program under which the debt was incurred;
    (5) A statement accompanying each magnetic tape by the referring 
bureau certifying that, with respect to each debt reported on the tape, 
all of the requirements of eligibility of the debt for referral for the 
refund offset have been satisfied. See Sec. 5.23(b).
    (d) A bureau shall promptly notify the IRS to correct Treasury data 
submitted when the bureau:
    (1) Determines that an error has been made with respect to a debt 
that has been referred;
    (2) Receives or credits a payment on such debt; or
    (3) Receives notification that the individual owing the debt has 
filed for bankruptcy under Title 11 of the United States Code or has 
been adjudicated bankrupt and the debt has been discharged.

[[Page 159]]

    (e) When advising debtors of an intent to refer a debt to the IRS 
for offset, the bureau shall also advise the debtors of all remedial 
actions available to defer or prevent the offset from taking place.



Sec. 5.28  Referral of debts for offset.

    (a) A bureau shall refer to the Service for collection by tax refund 
offset, from refunds otherwise payable in calendar year 1987, only such 
past-due legally enforceable debts owed to the Department:
    (1) That are eligible for offset under the terms of 31 U.S.C. 3720A, 
section 6402(d) of the Internal Revenue Code, 26 CFR 301.6402-6T, and 
the MOU; and
    (2) That information will be provided for each such debt as is 
required by the terms of the MOU.
    (b) Such referrals shall be made by submitting to the Service a 
magnetic tape pursuant to Sec. 5.27(c), together with an accompanying 
written certification to the Service by the bureau that the conditions 
or requirements specified in 26 CFR 301.6402-6T and the MOU have been 
satisfied with respect to each debt included in the referral on such 
tape. The bureaus certification shall be in the form specified in the 
MOU.



Sec. 5.29  Notice requirements before offset.

    (a) The bureau must notify, or make a reasonable attempt to notify, 
the individual that:
    (1) The debt is past due, and
    (2) Unless repaid within 60 days thereafter, the debt will be 
referred to the Service for offset against any refund of overpayment of 
tax;
    (b) The bureau shall provide a toll free telephone number for use in 
obtaining information from the bureau concerning the offset.
    (c) The bureau shall give the individual debtor at least sixty (60) 
days from the date of the notification to present evidence to the bureau 
that all or part of the debt is not past-due or legally enforceable. The 
bureau shall consider the evidence presented by the individual and shall 
make a determination whether an amount of such debt is past-due and 
legally enforceable. For purposes of this subsection, evidence that 
collection of the debt is affected by a bankruptcy proceeding involving 
the individual shall bar referral of the debt to the Service.
    (d) Notification given to a debtor pursuant to paragraphs (a), (b) 
and (c) of this section shall advise the debtor of how he or she may 
present evidence to the bureau that all or part of the debt is not past-
due or legally enforceable. Such evidence may not be referred to, or 
considered by, individuals who are not officials, employees, or agents 
of the United States in making the determination required under 
paragraph (c) of this section. Unless such evidence is directly 
considered by an official or employee of the bureau, and the 
determination required under paragraph (c) of this section has been made 
by an official or employee of the bureau, any unresolved dispute with 
the debtor as to whether all or part of the debt is past-due or legally 
enforceable must be referred to the bureau for ultimate administrative 
disposition, and the bureau must directly notify the debtor of its 
determination.



                    Subpart D--Administrative Offset

    Authority: 31 U.S.C. 3701; 31 U.S.C. 3711; 31 U.S.C. 3716.

    Source: 52 FR 52, Jan. 2, 1987, unless otherwise noted.



Sec. 5.30  Scope of regulations.

    These regulations apply to the collection of debts owed to the 
United States arising from transactions with the Department, or where a 
request for an offset is received by the Department from another agency. 
These regulations are consistent with the Federal Claims Collection 
Standards on administrative offset issued jointly by the Department of 
Justice and the General Accounting Office as set forth in 4 CFR 102.3.

[52 FR 52, Jan. 2, 1987, as amended at 53 FR 16703, May 11, 1988]



Sec. 5.31  Designation.

    The heads of bureaus and offices and their delegates are designated 
as designees of the Secretary of the Treasury authorized to perform all 
the duties for which the Secretary is responsible under the foregoing 
statutes: Provided, however, That no compromise of a

[[Page 160]]

claim shall be effected or collection action terminated except upon 
recommendation of the General Counsel or the appropriate bureau counsel 
or the designee of either. Notwithstanding the foregoing proviso, no 
such recommendation shall be required with respect to the termination of 
collection activity on any claim in which the unpaid amount of the debt 
is $300 or less.



Sec. 5.32  Definitions.

    (a) Administrative offset, as defined in 31 U.S.C. 3701(a)(1), means 
``withholding money payable by the United States Government to, or held 
by the Government for, a person to satisfy a debt the person owes the 
Government.
    (b) Person includes a natural person or persons, profit or non-
profit corporation, partnership, association, trust, estate, consortium, 
or other entity which is capable of owing a debt to the United States 
Government except that agencies of the United States, or of any State or 
local government shall be excluded.



Sec. 5.33  General.

    (a) The Secretary or his or her designee, after attempting to 
collect a debt from a person under section 3(a) of the Federal Claims 
Collection Act of 1966, as amended (31 U.S.C. 3711(a)), may collect the 
debt by administrative offset subject to the following:
    (1) The debt is certain in amount; and
    (2) It is in the best interests of the United States to collect the 
debt by administrative offset because of the decreased costs of 
collection and the acceleration in the payment of the debt;
    (b) The Secretary, or his or her designee, may initiate 
administrative offset with regard to debts owed by a person to another 
agency of the United States Government, upon receipt of a request from 
the head of another agency or his or her designee, and a certification 
that the debt exists and that the person has been afforded the necessary 
due process rights.
    (c) The Secretary, or his or her designee, may request another 
agency that holds funds payable to a Treasury debtor to offset the debt 
against the funds held and will provide certification that:
    (1) The debt exists; and
    (2) The person has been afforded the necessary due process rights.
    (d) If the six-year period for bringing action on a debt provided in 
28 U.S.C. 2415 has expired, then administrative offset may be used to 
collect the debt only if the costs of bringing such action are likely to 
be less than the amount of the debt.
    (e) No collection by administrative offset shall be made on any debt 
that has been outstanding for more than 10 years unless facts material 
to the Government's right to collect the debt were not known, and 
reasonably could not have been known, by the official or officials 
responsible for discovering and collecting such debt.
    (f) These regulations do not apply to:
    (1) A case in which administrative offset of the type of debt 
involved is explicitly provided for or prohibited by another statute; or
    (2) Debts owed by other agencies of the United States or by any 
State or local government.



Sec. 5.34  Notification procedures.

    Before collecting any debt through administrative offset, a notice 
of intent to offset shall be sent to the debtor by certified mail, 
return receipt requested, at the most current address that is available 
to the Department. The notice shall provide:
    (a) A description of the nature and amount of the debt and the 
intention of the Department to collect the debt through administrative 
offset;
    (b) An opportunity to inspect and copy the records of the Department 
with respect to the debt;
    (c) An opportunity for review within the Department of the 
determination of the Department with respect to the debt; and
    (d) An opportunity to enter into a written agreement for the 
repayment of the amount of the debt.



Sec. 5.35  Agency review.

    (a) A debtor may dispute the existence of the debt, the amount of 
debt, or the terms of repayment. A request to review a disputed debt 
must be submitted to the Treasury official who provided notification 
within 30 calendar days of the receipt of the written notice described 
in Sec. 5.34.

[[Page 161]]

    (b) If the debtor requests an opportunity to inspect or copy the 
Department's records concerning the disputed claim, 10 business days 
will be granted for the review. The time period will be measured from 
the time the request for inspection is granted or from the time the copy 
of the records is received by the debtor.
    (c) Pending the resolution of a dispute by the debtor, transactions 
in any of the debtor's account(s) maintained in the Department may be 
temporarily suspended. Depending on the type of transaction the 
suspension could preclude its payment, removal, or transfer, as well as 
prevent the payment of interest or discount due thereon. Should the 
dispute be resolved in the debtor's favor, the suspension will be 
immediately lifted.
    (d) During the review period, interest, penalties, and 
administrative costs authorized under the Federal Claims Collection Act 
of 1966, as amended, will continue to accrue.



Sec. 5.36  Written agreement for repayment.

    A debtor who admits liability but elects not to have the debt 
collected by administrative offset will be afforded an opportunity to 
negotiate a written agreement for the repayment of the debt. If the 
financial condition of the debtor does not support the ability to pay in 
one lump-sum, reasonable installments may be considered. No installment 
arrangement will be considered unless the debtor submits a financial 
statement, executed under penalty of perjury, reflecting the debtor's 
assets, liabilities, income, and expenses. The financial statement must 
be submitted within 10 business days of the Department's request for the 
statement. At the Department's option, a confess-judgment note or bond 
of indemnity with surety may be required for installment agreements. 
Notwithstanding the provisions of this section, any reduction or 
compromise of a claim will be governed by 4 CFR part 103 and 31 CFR 5.3.



Sec. 5.37  Administrative offset.

    (a) If the debtor does not exercise the right to request a review 
within the time specified in Sec. 5.35 or if as a result of the review, 
it is determined that the debt is due and no written agreement is 
executed, then administrative offset shall be ordered in accordance with 
these regulations without further notice.
    (b) Requests for offset to other Federal agencies. The Secretary or 
his or her designee may request that funds due and payable to a debtor 
by another Federal agency be administratively offset in order to collect 
a debt owed to the Department by that debtor. In requesting 
administrative offset, the Department, as creditor, will certify in 
writing to the Federal agency holding funds of the debtor:
    (1) That the debtor owes the debt;
    (2) The amount and basis of the debt; and
    (3) That the agency has complied with the requirements of 31 U.S.C. 
3716, its own administrative offset regulations and the applicable 
provisions of 4 CFR part 102 with respect to providing the debtor with 
due process.
    (c) Requests for offset from other Federal agencies. Any Federal 
agency may request that funds due and payable to its debtor by the 
Department be administratively offset in order to collect a debt owed to 
such Federal agency by the debtor. The Department shall initiate the 
requested offset only upon:
    (1) Receipt of written certification from the creditor agency:
    (i) That the debtor owes the debt;
    (ii) The amount and basis of the debt;
    (iii) That the agency has prescribed regulations for the exercise of 
administrative offset; and
    (iv) That the agency has complied with its own administrative offset 
regulations and with the applicable provisions of 4 CFR part 102, 
including providing any required hearing or review.
    (2) A determination by the Department that collection by offset 
against funds payable by the Department would be in the best interest of 
the United States as determined by the facts and circumstances of the 
particular case, and that such offset would not otherwise be contrary to 
law.



Sec. 5.38  Jeopardy procedure.

    The Department may effect an administrative offset against a payment 
to be made to the debtor prior to the

[[Page 162]]

completion of the procedures required by Secs. 5.34 and 5.34 of this 
part if failure to take the offset would substantially jeopardize the 
Department's ability to collect the debt, and the time before the 
payment is to be made does not reasonably permit the completion of those 
procedures. Such prior offset shall be promptly followed by the 
completion of those procedures. Amounts recovered by offset but later 
found not to be owed to the Department shall be promptly refunded.



PART 6--APPLICATIONS FOR AWARDS UNDER THE EQUAL ACCESS TO JUSTICE ACT--Table of Contents




                      Subpart A--General Provisions

Sec.
6.1  Purpose of these rules.
6.2  When the Act applies.
6.3  Proceedings covered.
6.4  Eligibility of applicants.
6.5  Standards for awards.
6.6  Allowable fees and other expenses.
6.7  Delegations of authority.

             Subpart B--Information Required From Applicants

6.8  Contents of application.
6.9  Net worth exhibit.
6.10  Documentation of fees and expenses.
6.11  When an application may be filed.

           Subpart C--Procedures for Considering Applications

6.12  Filing and service of documents.
6.13  Answer to application.
6.14  Decision.
6.15  Agency review.
6.16  Judicial review.
6.17  Payment of award.

    Authority: Sec. 203(a)(1), Pub. L. 96-481, 94 Stat. 2325 (5 U.S.C. 
504(c)(1)).

    Source: 47 FR 20765, May 14, 1982, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 6.1  Purpose of these rules.

    The Equal Access to Justice Act, 5 U.S.C. 504 (called ``the Act'' in 
this part), provides for the award of attorney fees and other expenses 
to eligible individuals and entities who are parties to certain 
administrative proceedings (called ``adversary adjudications'') before 
agencies of the Government of the United States. An eligible party may 
receive an award when it prevails over an agency, unless the agency's 
position in the proceeding was substantially justified or special 
circumstances make an award unjust. The rules in this part describe the 
parties eligible for awards and the proceedings that are covered. They 
also explain how to apply for awards, and the procedures and standards 
that the Treasury Department will use to make them.



Sec. 6.2  When the Act applies.

    The Act applies to any adversary adjudication pending before an 
agency at any time between October 1, 1981 and September 30, 1984. This 
includes proceedings begun before October 1, 1981, if final agency 
action has not been taken before that date, and proceedings pending on 
September 30, 1984, regardless of when they were initiated or when final 
agency action occurs.



Sec. 6.3  Proceedings covered.

    The Act applies to adversary adjudications required to be conducted 
by the Treasury Department under 5 U.S.C. 554. Within the Treasury 
Department, these proceedings are:
    (a) Bureau of Alcohol, Tobacco and Firearms: (1) Permit proceedings 
under the Federal Alcohol Administration Act (27 U.S.C. 204); (2) Permit 
proceedings under the Internal Revenue Code of 1954 (26 U.S.C. 5171, 
5271, 5713); (3) License and permit proceedings under the Federal 
Explosives Laws (18 U.S.C. 843).
    (b) Comptroller of the Currency:

All proceedings conducted under 12 CFR part 19, subpart A.



Sec. 6.4  Eligibility of applicants.

    (a) To be eligible for an award of attorney fees and other expenses 
under the Act, the applicant must be a party to the adversary 
adjudication for which it seeks an award. The term ``party'' is defined 
in 5 U.S.C. 551(3). The applicant must show that it meets all conditions 
of eligibility set out in this subpart and has complied with the 
requirements in Subpart B of this part.
    (b) The types of eligible applicants are as follows:
    (1) An individual with a net worth of not more than $1 million;

[[Page 163]]

    (2) The sole owner of an unincorporated business who has a net worth 
of not more than $5 million, including both personal and business 
interests, and not more than 500 employees;
    (3) A charitable or other tax-exempt organization described in 
section 501(c)(3) of the Internal Revenue Code (26 U.S.C. 501(c)(3)) 
with not more than 500 employees;
    (4) A cooperative association as defined in section 15(a) of the 
Agricultural Marketing Act (12 U.S.C. 1141(a)) with not more than 500 
employees, or
    (5) Any other partnership, corporation, association, or public or 
private organization with a net worth of not more than $5 million and 
not more than 500 employees.
    (c) For the purpose of eligibility, the net worth and number of 
employees of an applicant shall be determined as of the date the 
proceeding was initiated.
    (d) An applicant who owns an unincorporated business will be 
considered as an ``individual'' rather than a ``sole owner of an 
unincorporated business'' if the matter in controversy is primarily 
related to personal interests rather than to business interests.
    (e) The employees of an applicant include all persons who regularly 
perform services for remuneration for the applicant, under the 
applicant's direction and control. Part-time employees shall be 
included.
    (f) The net worth and number of employees of the applicant and all 
of its affiliates shall be aggregated to determine eligibility. Any 
individual or group of individuals, corporation or other entity that 
directly or indirectly controls or owns a majority of the voting shares 
of another business, or controls in any manner the election of a 
majority of that business's board of directors, trustees, or other 
persons exercising similar functions, will be considered an affiliate of 
that business for purposes of this part, unless the adjudicative officer 
determines that such treatment would be unjust and contrary to the 
purposes of the Act in light of the actual relationship between the 
afffiliated entities. In addition, the adjudicative officer may 
determine that financial relationships of the applicant other than those 
described in this paragraph constitute special circumstances that would 
make an award unjust.
    (g) An applicant that participates in a proceeding primarily on 
behalf of one or more other persons or entities that would be ineligible 
is not itself eligible for an award.



Sec. 6.5  Standards for awards.

    (a) A prevailing applicant may receive an award for fees and 
expenses incurred in connection with the final disposition of a 
proceeding, unless (1) the position of the agency was substantially 
justified, or (2) special circumstances make the award unjust. No 
presumption arises that the agency's position was not substantially 
justified simply because the agency did not prevail.
    (b) An award will be reduced or denied if the applicant has unduly 
or unreasonably protracted the proceeding or if special circumstances 
make the award sought unjust.



Sec. 6.6  Allowable fees and other expenses.

    (a) The following fees and other expenses are allowable under the 
Act:
    (1) Reasonable expenses of expert witnesses;
    (2) Reasonable cost of any study, analysis, engineering report, 
test, or project which the agency finds necessary for the preparation of 
the party's case;
    (3) Reasonable attorney or agent fees.
    (b) The amount of fees awarded will be based upon the prevailing 
market rates for the kind and quality of services furnished, except that
    (1) Compensation for an expert witness will not exceed the highest 
rate paid by the agency for expert witnesses; and
    (2) Attorney or agent fees will not be in excess of $75 per hour.



Sec. 6.7  Delegations of authority.

    The Director, Bureau of Alcohol, Tobacco and Firearms and the 
Comptroller of the Currency are authorized to take final action on 
matters pertaining to the Equal Access to Justice Act, 5 U.S.C. 504, in 
proceedings listed in Sec. 6.3 under the respective bureau or office. 
The Secretary of the Treasury may by order delegate authority to

[[Page 164]]

take final action on matters pertaining to the Equal Access to Justice 
Act in particular cases to other subordinate officials.



             Subpart B--Information Required From Applicants



Sec. 6.8  Contents of application.

    (a) An application for an award of fees and expenses under the Act 
shall identify the applicant and the proceeding for which an award is 
sought. The application shall show that the applicant has prevailed and 
identify the position of the agency in the proceeding that the applicant 
alleges was not substantially justified. The application shall state the 
basis for the applicant's belief that the position was not substantially 
justified. Unless the applicant is an individual, the application shall 
also state the number of employees of the applicant and describe briefly 
the type and purpose of its organization or business.
    (b) The application shall also include a statement that the 
applicant's net worth does not exceed $1 million (if an individual) or 
$5 million (for all other applicants, including their affiliates). 
However, an applicant may omit this statement if:
    (1) It attaches a copy of a ruling by the Internal Revenue Service 
that it qualifies as an organization described in section 501(c)(3) of 
the Internal Revenue Code (26 U.S.C. 501(c)(3)) or, in the case of a 
tax-exempt organization not required to obtain a ruling from the 
Internal Revenue Service on its exempt status, a statement that 
describes the basis for the applicant's belief that it qualifies under 
such section; or
    (2) It states that it is a cooperative association as defined in 
section 15(a) of the Agricultural Marketing Act (12 U.S.C. 1141j(a)).
    (c) The application shall itemize the amount of fees and expenses 
for which an award is sought.
    (d) The application may also include any other matters that the 
applicant wishes the agency to consider in determining whether and in 
what amount an award should be made.
    (e) The application shall be signed by the applicant or an 
authorized officer with respect to the eligibility of the applicant and 
by the attorney of the applicant with respect to fees and expenses 
sought. It shall also contain or be accompanied by a written 
verification under oath or under penalty of perjury that the information 
provided in the application is true and correct.

(Approved by the Office of Management and Budget under control number 
1512-0444, for applications filed with the Bureau of Alcohol, Tobacco 
and Firearms)

(5 U.S.C. 552(a) (80 Stat. 383, as amended))

[47 FR 20765, May 14, 1982, as amended at 49 FR 14944, Apr. 16, 1984]



Sec. 6.9  Net worth exhibit.

    (a) Each applicant except a qualified tax-exempt organization, or 
cooperative association must provide with its application a detailed 
exhibit showing the net worth of the applicant and any affiliates (as 
defined in Sec. 6.4(f)) when the proceeding was initiated. In the case 
of national banking associations, ``net worth'' shall be considered to 
be the total capital and surplus as reported, in conformity with the 
applicable instructions and guidelines, on the bank's last Consolidated 
Report of Condition filed before the initiation of the underlying 
proceeding.
    (b) The exhibit may be in any form convenient to the applicant that 
provides full disclosure of the applicant's and its affiliates assets 
and liabilities and is sufficient to determine whether the applicant 
qualifies under the standards in this part. The adjudicative officer may 
require an applicant to file additional information to determine its 
eligibility for an award.



Sec. 6.10  Documentation of fees and expenses.

    (a) The application shall be accompanied by full documentation of 
the fees and expenses, including the cost of any study, engineering 
report, test, or project, for which an award is sought.
    (b) The documentation shall include an affidavit from any attorney, 
agent, or expert witness representing or appearing in behalf of the 
party, stating the actual time expended and the rate at which fees and 
other expenses were computed and describing the specific services 
performed.

[[Page 165]]

    (1) The affidavit shall state the services performed. In order to 
establish the hourly rate, the affidavit shall state the hourly rate 
which is billed and paid by the majority of clients during the relevant 
time periods.
    (2) If not hourly rate is paid by the majority of clients because, 
for instance, the attorney or agent represents most clients on a 
contingency basis, the attorney or agent shall provide information about 
two attorneys or agents with similar experience, who perform similar 
work, stating their hourly rate.
    (c) The documentation shall also include a description of any 
expenses for which reimbursement is sought and a statement of the 
amounts paid and payable by the applicant or by any other person or 
entity for the services provided.
    (d) The adjudicative officer may require the applicant to provide 
vouchers, receipts, or other substantiation for any expenses claimed.



Sec. 6.11  When an application may be filed.

    (a) An application may be filed whenever the applicant has prevailed 
in the proceeding but in no case later than 30 days after the agency's 
final disposition of the proceeding.
    (b) If review or reconsideration is sought or taken of a decision as 
to which an appplicant believes it has prevailed, proceedings for the 
award of fees shall be stayed pending final disposition of the 
underlying controversy.



           Subpart C--Procedures for Considering Applications



Sec. 6.12  Filing and service of documents.

    Any application for an award or other pleading or document related 
to an application shall be filed and served on all parties to the 
proceeding in the same manner as other pleadings in the proceeding.



Sec. 6.13  Answer to application.

    (a) Within 30 days after service of an application, counsel 
representing the agency against which an award is sought shall file an 
answer to the application.
    (b) If agency counsel and the applicant believe that the issues in 
the fee application can be settled, they may jointly file a statement of 
their intent to negotiate a settlement. The filing of this statement 
shall extend the time for filing an answer for an additional 60 days and 
further extensions may be granted by the adjudicative officer upon 
request by agency counsel and the applicant.
    (c) The answer shall explain any objections to the award requested 
and identify the facts relied on in support of agency counsel's 
position. If the answer is based on any alleged facts not already in the 
record of the proceeding, agency counsel shall include with the answer 
supporting affidavits.



Sec. 6.14  Decision.

    The adjudicative officer shall issue an initial decision on the 
application within 60 days after completion of proceedings on the 
application. The decision shall include written findings and conclusions 
on the applicant's eligibility and status as a prevailing party, and an 
explanation of the reasons for any difference between the amount 
requested and the amount awarded. The decision shall also include, if at 
issue, findings on whether the agency's position was substantially 
justified, whether the applicant unduly protracted the proceedings, or 
whether special circumstances make an award unjust.



Sec. 6.15  Agency review.

    Either the applicant or agency counsel may seek review of the 
initial decision on the fee application, or the agency may decide to 
review the decision on its own initiative. If neither the applicant nor 
agency counsel seeks a review and the agncy does not take review on its 
own initiative, the initial decision on the application shall become a 
final decision of the agency 30 days after it is issued. Whether to 
review a decision is a matter within the discretion of the agency. If 
review is taken, the agency will issue a final decision on the 
application or remand the application to the adjudicative officer for 
further proceedings.

[[Page 166]]



Sec. 6.16  Judicial review.

    Judicial review of final agency decisions on awards may be sought as 
provided in 5 U.S.C. 504(c)(2).



Sec. 6.17  Payment of award.

    An applicant seeking payment of an award shall submit to the agency 
a copy of the agency's final decision granting the award, accompanied by 
a statement that the applicant will not seek review of the decision in 
the United States courts. An applicant shall be paid the amount awarded 
unless judicial review of the award or of the underlying decision of the 
adversary adjudication has been sought by the applicant or any other 
party to the proceeding.



PART 7--EMPLOYEE INVENTIONS--Table of Contents




Sec.
7.1  Purpose.
7.2  Responsibilities of the Department.
7.3  Responsibilities of heads of offices.
7.4  Responsibilities of the General Counsel.
7.5  Responsibilities of employees.
7.6  Effect of awards.
7.7  Appeals.
7.8  Delegation.

    Authority: 80 Stat. 379; 5 U.S.C. 301, sec. 6, E.O. 10096; 3 CFR, 
1949-1953 Comp., p. 292, as amended by E.O. 10930; 3 CFR, 1959-1963 
Comp., p. 456.

    Source: 33 FR 10088, July 13, 1968, unless otherwise noted.



Sec. 7.1  Purpose.

    Provisions defining the right, title, and interest of the Government 
in and to an invention made by a Government employee under various 
circumstances and the duties of Government agencies with respect thereto 
are set forth in Executive Order 10096, 15 FR 389, as amended (35 U.S.C. 
266 note). Further definition of the circumstances under which the 
Government will acquire the right to a patent in such an invention or a 
nonexclusive, irrevocable, royalty-free license in the invention, and 
the procedures for the determination of these interests, are set forth 
in the regulations issued under that Executive order by the Patent 
Office, 37 CFR part 100. The purpose of this part 7 is to implement for 
the Treasury Department the foregoing Executive order and regulations of 
the Patent Office by (a) bringing to the attention of Treasury employees 
the law and procedure governing their rights to, and interest in, 
inventions made by them, (b) defining responsibility within the 
Department for making the necessary determinations, and, (c) 
establishing internal procedures for action in conformity with the 
Executive order and the Patent Office regulations.



Sec. 7.2  Responsibilities of the Department.

    The responsibilities of the Treasury Department are to determine 
initially (a) the occurrence of an invention by an employee, (b) his 
rights in the invention and the rights of the Government therein, and 
(c) whether patent protection will be sought in the United States by the 
Department, and to furnish the required reports to the Patent Office.



Sec. 7.3  Responsibilities of heads of offices.

    (a) Heads of bureaus or offices in the Department shall be 
responsible for determining initially whether the results of research, 
development, or other activity of an employee within that bureau or 
office constitute an invention which falls within the purview of 
Executive Order 10096, as amended, and is to be handled in accordance 
with the regulations in this part.
    (b) Heads of bureaus or offices are responsible for obtaining from 
the employee the necessary information and, if the determination under 
paragraph (a) of this section is affirmative, preparing on behalf of the 
bureau or office a description of the invention and its relationship to 
the employee's duties and work assignments.
    (c) Heads of bureaus or offices, after such examination and 
investigation as may be necessary, shall refer to the General Counsel 
all information obtained concerning the invention and such determination 
as the head of the bureau or office has made with respect to the 
character of the activity as an invention. These reports shall include 
any determination as to the giving of a cash award to the employee for 
his performance relating to that invention.

[[Page 167]]



Sec. 7.4  Responsibilities of the General Counsel.

    (a) The General Counsel shall be responsible for determining, 
subject to review by the Commissioner of Patents, the respective rights 
of the Government and of the inventor in and to any invention made by an 
employee of the Department.
    (b) On the basis of the foregoing determination, the General Counsel 
shall determine whether patent protection will be sought by the 
Department for such an invention.
    (c) The General Counsel will prepare and furnish to the Patent 
Office the reports required by the regulations of that Office and will 
serve as the liaison officer between the Department and the Commissioner 
of Patents.



Sec. 7.5  Responsibilities of employees.

    All employees are required to report to the heads of their bureaus 
or offices any result of research, development, or other activity on 
their part which may constitute an invention and the circumstances under 
which this possible invention came into being.



Sec. 7.6  Effect of awards.

    The acceptance by an employee of a cash award for performance which 
constitutes an invention shall, in accordance with 5 U.S.C. 4502(c), 
constitute an agreement that the use by the Government of the idea, 
method, or device for which the award is made does not form the basis of 
any further claim against the Government by the employee, his heirs or 
assigns.



Sec. 7.7  Appeals.

    (a) Any employee who is aggrieved by a determination made by the 
head of his bureau or office under this part may obtain a review of the 
determination by filing an appeal with the General Counsel within 30 
days after receiving the notice of the determination complained of.
    (b) Any employee who is aggrieved by a determination made by the 
General Counsel under this part may obtain a review of the determination 
by filing a written appeal with the Commissioner of Patents within 30 
days after receiving notice of the determination complained of, or 
within such longer period as the Commissioner may provide. The appeal to 
the Commissioner shall be processed in accordance with the provisions in 
the regulations of the Patent Office for an appeal from an agency 
determination.



Sec. 7.8  Delegation.

    The heads of bureaus or offices and the General Counsel may 
delegate, as appropriate, the performance of the responsibilities 
assigned to them under this part.



PART 8--PRACTICE BEFORE THE BUREAU OF ALCOHOL, TOBACCO AND FIREARMS--Table of Contents




                     Subpart A--General Requirements

Sec.
8.1  Scope.
8.2  Persons who may practice.
8.3  Conference and practice requirements.
8.4  Director of Practice.
8.5  Records.
8.6  Special orders.

                         Subpart B--Definitions

8.11  Meaning of terms.

                    Subpart C--Enrollment Procedures

8.21  Eligibility for enrollment.
8.22  Application for enrollment.
8.23  Denial of enrollment; appeal.
8.24  Enrollment cards.
8.25  Renewal of enrollment card.
8.26  Change in enrollment.
8.27  Enrollment registers.
8.28  Termination of enrollment.
8.29  Limited practice without enrollment.

         Subpart D--Duties and Restrictions Relating to Practice

8.31  Furnishing of information.
8.32  Prompt disposition of pending matters.
8.33  Accuracy.
8.34  Knowledge of client's omission.
8.35  Assistance from disbarred or suspended persons and former Treasury 
          employees.
8.36  Practice by partners of Government employees.
8.37  Practice by former Government employees.
8.38  Notaries.
8.39  Fees.
8.40  Conflicting interests.
8.41  Solicitation.
8.42  Practice of law.

[[Page 168]]

                   Subpart E--Disciplinary Proceedings

8.51  Authority to disbar or suspend.
8.52  Disreputable conduct.
8.53  Initiation of disciplinary proceedings.
8.54  Conferences.
8.55  Contents of complaint.
8.56  Service of complaint and other papers.
8.57  Answer.
8.58  Supplemental charges.
8.59  Proof; variance; amendment of pleadings.
8.60  Motions and requests.
8.61  Representation.
8.62  Administrative Law Judge.
8.63  Hearings.
8.64  Evidence.
8.65  Depositions.
8.66  Transcript.
8.67  Proposed findings and conclusions.
8.68  Decision of Administrative Law Judge.
8.69  Appeal to the Secretary.
8.70  Decision of the Secretary.
8.71  Effect of disbarment or suspension.
8.72  Petition for reinstatement.

    Authority: Sec. 3, 23 Stat. 258 (31 U.S.C. 1026); 5 U.S.C. 301, 500, 
551-559; and Reorganization Plan No. 26 of 1950, 15 FR 4935, 64 Stat. 
1280, as amended.

    Source: 42 FR 33026, June 29, 1977, unless otherwise noted.



                     Subpart A--General Requirements



Sec. 8.1  Scope.

    This part contains rules governing the recognition of attorneys, 
certified public accountants, enrolled practitioners, and other persons 
representing clients before the Bureau of Alcohol, Tobacco and Firearms.



Sec. 8.2  Persons who may practice.

    (a) Attorneys. Any attorney who is not currently under suspension or 
disbarment from practice before the Bureau of Alcohol, Tobacco and 
Firearms, may practice before the Bureau upon filing a written 
declaration with the Bureau, that he or she is currently qualified as an 
attorney and is authorized to represent the particular party on whose 
behalf he or she acts.
    (b) Certified public accountants. Any certified public accountant 
who is not currently under suspension or disbarment before the Bureau of 
Alcohol, Tobacco and Firearms, may practice before the Bureau upon 
filing a written declaration with the Bureau, that he or she is 
currently qualified as a certified public accountant and is authorized 
to represent the particular party on whose behalf he or she acts.
    (c) Enrollment practitioners. Any person enrolled as a practitioner 
under the provisions of subpart C of this part and who is not under 
suspension or disbarment from enrollment may practice before the Bureau.
    (d) Limited practitioners. Any person qualified for limited practice 
without enrollment under the provisions of Sec. 8.29 may practice before 
the Bureau.
    (e) Restrictions on Government officers and employees. Any officer 
or employee of the United States in the executive, legislative, or 
judicial branch of the Government, or in any agency of the United 
States, including the District of Columbia, who is otherwise eligible to 
practice under the provisions of this part, may represent parties before 
the Bureau when doing so in the conduct of his or her official duties. A 
Government officer or employee may not otherwise practice before the 
Bureau except that, subject to the requirements of 18 U.S.C. 205, he or 
she may represent a member of his or her immediate family or a person or 
estate for which he or she serves as guardian, executor, administrator, 
trustee or other personal fiduciary. Member of Congress or Resident 
Commissioners (elect or serving) may not practice before the Bureau in 
connection with any matter for which they directly or indirectly seek 
any compensation.
    (f) Restrictions on State officers and employees. No officer or 
employee of any State, or subdivision thereof, whose official 
responsibilities require him or her to pass upon, investigate, or deal 
with any State law or regulation concerning alcohol, tobacco, firearms, 
explosives matters or wagering, may practice before the Bureau if his or 
her official responsibility may disclose pertinent facts or information 
relating to matters administered by the Bureau.
    (g) Customhouse brokers. Customhouse brokers, licensed by the 
Commissioner of Customs according to 19 CFR part 111, may represent a 
party for whom they have acted as a customhouse broker before the Bureau 
with respect to matters relating to the importation

[[Page 169]]

or exportation of merchandise under customs or intenal revenue laws.

(Approved by the Office of Management and Budget under control number 
1512-0418)
(18 U.S.C. 203, 205; 5 U.S.C. 552(a) (80 Stat. 383, as amended))

[42 FR 33026, June 29, 1977, as amended at 49 FR 14944, Apr. 16, 1984]



Sec. 8.3  Conference and practice requirements.

    Conference and practice requrements of the Bureau of Alcohol, 
Tobacco and Firearms, including requirements for powers of attorney are 
set forth in:
    (a) 26 CFR part 601, subpart E (or those regulations as recodified 
in 27 CFR part 71 subsequent to the effective date of these regulations, 
31 CFR part 8) with respect to all representations before the Bureau 
except those concerning license or permit proceedings;
    (b) 27 CFR part 200 with respect to proceedings concerning permits 
issued under the Federal Alcohol Administration Act or the Internal 
Revenue Code;
    (c) 27 CFR 47.44 with respect to proceedings concerning licenses 
issued under the Arms Export Control Act (22 U.S.C. 2778);
    (d) 27 CFR part 178, subpart E, with respect to proceedings 
concerning licenses issued under the Gun Control Act of 1968 (18 U.S.C. 
Chapter 44); and
    (e) 27 CFR part 181, subpart E, with respect to proceedings 
concerning licenses or permits issued under the Organized Crime Control 
Act of 1970 (18 U.S.C. Chapter 40).



Sec. 8.4  Director of Practice.

    (a) Appointment. The Secretary shall appoint the Director of 
Practice. In the event of the absence of the Director of Practice or a 
vacancy in that office, the Secretary shall designate an officer or 
employee of the Treasury Department to act as Director of Practice.
    (b) Duties. The Director of Practice, Office of the Secretary of the 
Treasury, shall: Act upon appeals from decisions of the Director denying 
applications for enrollment to practice before the Bureau; institute and 
provide for the conduct of disciplinary proceedings relating to 
attorneys, certified public accountants, and enrolled practitioners; 
make inquiries with respect to matters under his or her jurisdiction; 
and perform other duties as are necessary or appropriate to carry out 
his or her functions under this part or as are prescribed by the 
Secretary.



Sec. 8.5  Records.

    (a) Availability. Registers of all persons admitted to practice 
before the Bureau, and of all persons disbarred or suspended from 
practice, which are required to be maintained by the director under the 
provisions of Sec. 8.27, will be available for public inspection at the 
Office of the Director. Other records may be disclosed upon specific 
request in accordance with the disclosure regulations of the Bureau (27 
CFR part 71) and the Office of the Secretary.
    (b) Disciplinary proceedings. The Director, may grant a request by 
an attorney, certified public accountant, or enrolled practitioner to 
make public a hearing in a disciplinary proceeding, conducted under the 
provisions of subpart E of this part concerning the attorney, certified 
public accountant or enrolled practioner, and to make the record of the 
proceeding available for public inspection by interested persons, if an 
agreement is reached by stipulation in advance to prevent disclosure of 
any information which is confidential, in accordance with applicable 
laws and regulations.



Sec. 8.6  Special orders.

    The secretary reserves the power to issue special orders as he or 
she may deem proper in any cases within the scope of this part.



                         Subpart B--Definitions



Sec. 8.11  Meaning of terms.

    As used in this part, terms shall have the meaning given in this 
section. Words in the plural shall include the singular, and vice versa. 
The terms include and including do not exclude things not enumerated 
which are in the same general class.
    Administrative Law Judge. The person appointed pursuant to 5 U.S.C. 
3105, designated to preside over any administrative proceedings under 
this part.

[[Page 170]]

    Attorney. A person who is a member in good standing of the bar of 
the highest court of any State, possession, territory, Commonwealth, or 
the District of Columbia.
    Bureau. The Bureau of Alcohol, Tobacco and Firearms, the Department 
of the Treasury, Washington, DC 20226.
    Certified public accountant. Any person who is qualified to practice 
as a certified public accountant in any State, possession, territory, 
Commonwealth, or the District of Columbia.
    CFR. The Code of Federal Regulations.
    Director. The Director, Bureau of Alcohol, Tobacco and Firearms, the 
Department of the Treasury, Washington, DC.
    Enrolled practitioner. Any person enrolled to practice before the 
Bureau of Alcohol, Tobacco and Firearms pursuant to Subpart C of this 
part.
    Practice before the Bureau. This comprehends all matters connected 
with presentation to the Bureau or any of its officers or employees 
relating to a client's rights, privileges or liabilities under laws or 
regulations administered by the Bureau. Presentations include the 
preparation and filing of necessary documents, correspondence with and 
communications to the Bureau, and the representation of a client at 
conferences, hearings, and meetings. Preparation of a tax return, 
appearance of an individual as a witness for any party, or furnishing 
information at the request of the Bureau of any of its officers or 
employees is not considered practice before the Bureau.
    Secretary. The Secretary of the Treasury.
    U.S.C. The United States Code.



                    Subpart C--Enrollment Procedures



Sec. 8.21  Eligibility for enrollment.

    (a) General qualifications. The Director may grant enrollment to 
practice to any person who has not engaged in conduct which would 
justify the disbarment or suspension of any attorney, certified public 
accountant, or enrolled practioner. Each person shall demonstrate to the 
satisfaction of the Director that he or she possesses the necessary 
technical qualifications to enable him or her to render valuable service 
before the Bureau, and that he or she is otherwise competent to advise 
and assists in the presentation of matters before the Bureau.
    (b) Technical qualifications. The Director may grant enrollment to 
practice only to persons possessing technical knowledge of the laws and 
regulations administered by the Bureau.
    (1) Minimum criteria required of an enrolled practioner will consist 
of: 5 years employment with the Treasury Department in a responsible 
position which would familiarize the person with applicable laws and 
regualtions; or 5 years employment in a regulated industry in a 
responsible position which would familiarize the person with applicable 
laws and regulations; or possession of a law degree; or other 
significant experience such as the prior respresentation of persons 
before the Internal Revenue Service or the Bureau of Alcohol, Tobacco 
and Firearms.
    (2) An enrolled paractioner may demonstrate technical knowledge in 
one or more of the several areas of laws and regulations administered by 
the Bureau (alcohol, tobacco firearms, or explosives matters).
    (c) Natural persons. Enrollment to practice may only be granted to 
natural persons who have become 18 years of age.
    (d) Attorneys, certified public accountants. Enrollment if not 
available to persons who are attorneys or certified public accountants 
who qualify to practice without enrollment under Sec. 8.2 (a) or (b).

[42 FR 33026, June 29, 1977; 42 FR 36455, July 15, 1977]



Sec. 8.22  Application for enrollment.

    (a) Information to be furnished. An applicant for enrollment to 
practice shall state his or her name, address, and business address, 
citizenship, and age on the application. The applicant shall also state 
if he or she has ever been suspended or disbarred as an attorney or 
certified public accountant, or if the applicant's right to practice has 
ever been revoked by any court, commission, or administrative agency in 
any jurisdiction. The applicant shall set forth his or her technical 
qualifications as required by Sec. 8.21(b) which enable him or her to 
render valuable service

[[Page 171]]

before the Bureau. The applicant shall indicate which area or areas of 
Bureau matters in which he or she desires to practice (alcohol, tobacco, 
firearms, or explosives matters).
    (b) Fee. Each application for enrollment will be accompanied by a 
check or money order in the amount of $25, payable to the Bureau of 
Alcohol, Tobacco and Firearms. This fee will be retained by the United 
States whether or not the applicant is granted enrollment. Agents who 
are enrolled to practice before the Internal Revenue Service prior to 
September 27, 1977, need not include this fee and should indicate their 
enrollment number on the application.
    (c) Execution under oath. All applications for enrollment will be 
executed under oath or affirmation.
    (d) Filing. Applications for enrollment will be filed with the 
Assistant Director, Regulatory Enforcement, Bureau of Alcohol, Tobacco 
and Firearms, 1200 Pensylvania Avenue NW., Washington, DC 20226.
    (e) Additional information. The Director, as a condition to 
consideration for enrollment, may require the applicant to file 
additional information as necessary to determine if the applicant is 
qualified. The Director shall, upon written request, afford an applicant 
the opportunity to be heard with respect to his or her application for 
enrollment.

(Approved by the Office of Management and Budget under control number 
1512-0418)

(Sec. 501, Pub. L. 82-137, 65 Stat. 290 (31 U.S.C. 483a); 5 U.S.C. 
552(a) (80 Stat. 383, as amended))

[42 FR 33026, June 29, 1977; 42 FR 36455, July 15, 1977, as amended at 
49 FR 14944, Apr. 16, 1984]



Sec. 8.23  Denial of enrollment; appeal.

    (a) The Director, in denying an application for enrollment, shall 
inform the applicant as to the reasons. The applicant may, within 30 
days after receipt of the notice of denial, file a written appeal 
together with reasons in support thereof, with the Director of Practice. 
The Director of Practice shall render a decision on the appeal as soon 
as practicable.
    (b) An applicant may, within 30 days after receipt of the decision 
of the Director of Practice in sustaining a denial of enrollment, appeal 
the decision to the Secretary.



Sec. 8.24  Enrollment cards.

    The Director shall issue an enrollment card to each practitioner who 
is enrolled to practice before the Bureau. Each enrollment card is valid 
for a period of 5 years as long as the holder remains enrolled and in 
good standing before the Bureau. Unless advised to the contrary by the 
Director, any officer or employee of the Bureau may consider the holder 
of an unexpired enrollment card to be authorized to practice before the 
Bureau in the subject area or areas indicated upon the card (alcohol, 
tobacco, firearms, or explosives matters).



Sec. 8.25  Renewal of enrollment card.

    (a) Period of renewal. An enrolled practitioner may apply for 
renewal of his or her enrollment card during a 12-month period prior to 
the expiration of the enrollment card.
    (b) Application. Each enrolled practitioner applying for a renewal 
of enrollment shall apply to the Director. The enrolled practitioner 
shall include in the application all information required by Sec. 8.22 
except information relating to technical qualifications unless the 
enrolled practitioner is applying for enrollment in a subject area or 
areas in which he or she was not previously qualified to practice.
    (c) Fee. Each application for renewal of enrollment will be 
accompanied by a check or money order in the amount of $5, payable to 
the Bureau of Alcohol, Tobacco and Firearms.

(Approved by the Office of Management and Budget under control number 
1512-0418)

(5 U.S.C. 552(a) (80 Stat. 383, as amended))

[42 FR 33026, June 29, 1977, as amended at 49 FR 14944, Apr. 16, 1984]



Sec. 8.26  Change in enrollment.

    (a) Change in area of practice. At any time during a period of 
enrollment, an enrolled practitioner may apply to practice in a subject 
area or areas in which he or she was not previously qualified to 
practice (alcohol, tobacco, firearms, or explosives matters).

[[Page 172]]

    (b) Application. Each enrolled practitioner applying for a change in 
enrollment shall apply to the Director. The enrolled practitioner shall 
include in the application all information required by Sec. 8.22 but 
shall include information relating to technical qualifications only in 
those additional subject areas in which he or she is applying to 
practice.
    (c) Fee. Each application for change in enrollment will be 
accompanied by a check or money order in the amount of $5, payable to 
the Bureau of Alcohol, Tobacco and Firearms.

(Approved by the Office of Management and Budget under control number 
1512-0418)

(5 U.S.C. 552(a) (80 Stat. 383, as amended))

[42 FR 33026, June 29, 1977, as amended at 49 FR 14944, Apr. 16, 1984]



Sec. 8.27  Enrollment registers.

    The Director shall maintain, for public inspection, a register of 
all persons enrolled to practice before the Bureau and the subject areas 
in which each person is enrolled to practice, a register of all persons 
disbarred or suspended from practice, and a register of all persons 
whose applications for enrollment before the Bureau have been denied.



Sec. 8.28  Termination of enrollment.

    (a) Attorneys, certified public accountants. The enrollment of a 
practitioner to whom an enrollment card has been issued will terminate 
when that person becomes eligible to practice without enrollment under 
Sec. 8.2 (a) or (b), and that person shall surrender his or her 
enrollment card to the Director for cancellation.
    (b) Expiration of enrollment. The enrollment of any person will 
automatically terminate after the date indicated on the enrollment card 
unless, during the 12-month period prior to the expiration date, that 
person applies for renewal of enrollment with the Director as provided 
in Sec. 8.25. In this case, the person may continue to practice before 
the Bureau until his or her application has been finally determined.



Sec. 8.29  Limited practice without enrollment.

    (a) General. Individuals may appear on their own behalf and may 
otherwise appear without enrollment, providing they present satisfactory 
identification, in the following classes of cases:
    (1) An individual may represent another individual who is his or her 
regular full-time employer, may represent a partnership of which he or 
she is a member or a regular full-time employee, of may represent 
without compensation a member of his or her immediate family.
    (2) Corporations (including parent corporations, subsidiaries or 
affiliated corporations), trusts, estates, associations, or organized 
groups may be represented by bona fide officers or regular full-time 
employees.
    (3) Trusts, receiverships, guardianships, or estates may be 
represented by their trustees, receivers, guardians, administrators, 
executors, or their regular full-time employees.
    (4) Any government unit, agency, or authority may be represented by 
an officer or regular employee in the course of his or her official 
duties.
    (5) Unenrolled persons may participate in rulemaking as provided in 
5 U.S.C. 553.
    (b) Special appearances. The Director, subject to conditions he or 
she deems appropriate, may authorize any person to represent a party 
without enrollment, for the purpose of a particular matter.



         Subpart D--Duties and Restrictions Relating to Practice



Sec. 8.31  Furnishing of information.

    (a) To the Bureau. No attorney, certified public accountant, or 
enrolled practitioner may neglect or refuse promptly to submit records 
or information in any matter before the Bureau, upon proper and lawful 
request by an authorized officer or employee of the Bureau, or may 
interfere, or attempt to interfere, with any proper and lawful effort by 
the Bureau or its officers or employees, to obtain the requested record 
or information, unless he or she

[[Page 173]]

believes in good faith and on reasonable grounds that the record or 
information is privileged or that the request for, or effort to obtain, 
that record or information is of doubtful legality.
    (b) To the Director of Practice. It is the duty of an attorney or 
certified public accountant, who practices before the Bureau, or 
enrolled practitioner when requested by the Director of Practice, to 
provide the Director of Practice with any information he or she may have 
concerning violation of the regulations in this part by any person, and 
to testify thereto in any proceeding instituted under this part for the 
disbarment or suspension of an attorney, certified public accountant, or 
enrolled practitioner, unless he or she believes in good faith and on 
reasonable grounds that that information is privileged or that the 
request is of doubtful legality.



Sec. 8.32  Prompt disposition of pending matters.

    No attorney, certified public accountant, or enrolled practitioner 
may unreasonably delay the prompt disposition of any matter before the 
Bureau.



Sec. 8.33  Accuracy.

    Each attorney, certified public accountant, and enrolled 
practitioner shall exercise due diligence in:
    (a) Preparing or assisting in the preparation of, approving, and 
filing returns, documents, affidavits, and other papers relating to 
Bureau matters;
    (b) Determining the correctness of any representations made by him 
or her to the Bureau; and
    (c) Determining the correctness of any information which he or she 
imparts to a client with reference to any matter administered by the 
Bureau.



Sec. 8.34  Knowledge of client's omission.

    Each attorney, certified public accountant, or enrolled practitioner 
who knows that a client has not complied with applicable law, or has 
made an error in or omission from any document, affidavit, or other 
paper which the law requires the client to execute, shall advise the 
client promptly of the fact of such noncompliance, error, or omission.



Sec. 8.35  Assistance from disbarred or suspended persons and former Treasury employees.

    No attorney, certified public accountant or enrolled practitioner 
shall, in practice before the Bureau, knowingly and directly or 
indirectly:
    (a) Employ or accept assistance from any person who is under 
disbarment or suspension from practice before any agency of the Treasury 
Department;
    (b) Accept employment as associate, correspondent, or subagent from, 
or share fees with, any such person;
    (c) Accept assistance in a specific matter from any person who 
participated personally and substantially in the matter as an employee 
of the Treasury Department.

[44 FR 47059, Aug. 10, 1979]



Sec. 8.36  Practice by partners of Government employees.

    No partner of an officer or employee of the executive branch of the 
U.S. Government, of any independent agency of the United States, or of 
the District of Columbia, may represent anyone in any matter 
administered by the Bureau in which the Government employee participates 
or has participated personally and substantially as a Government 
employee, or which is the subject of that employee's official 
responsibility.



Sec. 8.37  Practice by former Government employees.

    (a) Violation of law. No former officer or employee of the U.S. 
Government, of any independent agency of the United States, or of the 
District of Columbia, may represent anyone in any matter administered by 
the Bureau if the representation would violate any of the laws of the 
United States.
    (b) Personal and substantial participation. No former officer or 
employee of the executive branch of the U.S. Goverment, of any 
independent agency of the United States, or of the District of Columbia, 
may represent anyone with repect to any matter under the administration 
of the Bureau, if he or she participated personally and substantially in 
that matter a a Government employee.
    (c) Official responsibility. No former officer or employee of the 
executive

[[Page 174]]

branch of the U.S. Government, of any indepenednt agency of the United 
States, or of the District of Columbia, may within one year after his or 
her employment has ceased, appear personally as a practitioner before 
the Bureau with respect to any matter administered by the Bureau if that 
representation involves a specific matter under the former employee's 
official responsibility as a Government employee, within a one-year 
period prior to the termination of that responsibility.
    (d) Aid or assistance. No former officer or employee of the Bureau, 
who is eligible to practice before the Bureau, may aid or assist any 
person in the representation of a specific matter in which the former 
officer or employee participated personally and substantially as an 
officer or employee of the Bureau.

(18 U.S.C. 207)



Sec. 8.38  Notaries.

    No attorney, certified public accountant, or enrolled practitioner 
may, with respect to any matter administered by the Bureau, take 
acknowledgements, administer oaths, certify papers, or perform any 
official act in connection with matters in which he or she is employed 
as counsel, attorney, or practioner, or in which he or she may be in any 
way interested before the Bureau.

(26 Op. Atty. Gen. 236)



Sec. 8.39  Fees.

    No attorney, certified public accountant, or enrolled practitioner 
may charge an unconscionable fee for representing a client in any matter 
before the Bureau.



Sec. 8.40  Conflicting interests.

    No attorney, certified public accountant, or enrolled practitioner 
may represent conflicting interests in practice before the Bureau, 
except by express consent of all directly interested parties after full 
disclosure has been made.



Sec. 8.41  Solicitation.

    (a) Advertising and solicitation restrictions. (1) No attorney, 
certified public accountant or enrolled practitioner shall, with respect 
to any Bureau matter, in any way use or participate in the use of any 
form of public communication containing a false, fraudulent, misleading, 
deceptive, unduly influencing, coercive or unfair statement or claim. 
For the purposes of this subsection, the prohibition includes, but is 
not limited to, statements pertaining to the quality of services 
rendered unless subject to factual verification, claims of specialized 
expertise not authorized by State or Federal agencies having 
jurisdiction over the practitioner, and statements or suggestions that 
the ingenuity and/or prior record of a representative rather than the 
merit of the matter are principal factors likely to determine the result 
of the matter.
    (2) No attorney, certified public accountant or enrolled 
practitioner shall make, directly or indirectly, an uninvited 
solicitation of employment, in matters related to the Bureau. 
Solicitation includes, but is not limited to, in-person contacts, 
telephone communications, and personal mailings directed to the specific 
circumstances unique to the recipient. This restriction does not apply 
to: (i) Seeking new business from an existing or former client in a 
related matter; (ii) solicitation by mailings, the contents of which are 
designed for the general public; or (iii) non-coercive in-person 
solicitation by those eligible to practice before the Bureau while 
acting as an employee, member, or officer of an exempt organization 
listed in sections 501(c) (3) or (4) of the Internal Revenue Code of 
1954 (26 U.S.C.).
    (b) Permissible advertising. (1) Attorneys, certified public 
accountants and enrolled practitioners may publish, broadcast, or use in 
a dignified manner through any means of communication set forth in 
paragraph (d) of this section:
    (i) The name, address, telephone number, and office hours of the 
practitioner or firm.
    (ii) The names of individuals associated with the firm.
    (iii) A factual description of the services offered.
    (iv) Acceptable credit cards and other credit arrangements.
    (v) Foreign language ability.

[[Page 175]]

    (vi) Membership in pertinent, professional organizations.
    (vii) Pertinent professional licenses.
    (viii) A statement that an individual's or firm's practice is 
limited to certain areas.
    (ix) In the case of an enrolled practitioner, the phrase ``enrolled 
to practice before the Bureau of Alcohol, Tobacco and Firearms.''
    (x) Other facts relevant to the selection of a practitioner in 
matters related to the Bureau which are not prohibited by these 
regulations.
    (2) Attorneys, certified public accountants and enrolled 
practitioners may use, to the extent they are consistent with the 
regulations in this section, customary biographical insertions in 
approved law lists and reputable professional journals and directories, 
as well as professional cards, letterheads and announcements: Provided, 
That (i) attorneys do not violate applicable standards of ethical 
conduct adopted by the American Bar Association, (ii) certified public 
accountants do not violate applicable standards of ethical conduct 
adopted by the American Institute of Certified Public Accountants, and 
(iii) enrolled practitioners do not violate applicable standards of 
ethical conduct adopted by the National Society of Public Accountants.
    (c) Fee information. (1) Attorneys, certified public accountants and 
enrolled practitioners may disseminate the following fee information:
    (i) Fixed fees for specific routine services.
    (ii) Hourly rates.
    (iii) Range of fees for particular services.
    (iv) Fee charged for an initial consultation.
    (2) Attorneys, certified public accountants and enrolled 
practitioners may also publish the availability of a written schedule of 
fees.
    (3) Attorneys, certified public accountants and enrolled 
practitioners shall be bound to charge the hourly rate, the fixed fee 
for specific routine services, the range of fees for particular 
services, or the fee for an initial consultation published for a 
reasonable period of time, but no less than thirty days from the last 
publication of such hourly rate or fees.
    (d) Communications. Communications, including fee information, shall 
be limited to professional lists, telephone directories, print media, 
permissible mailings as provided in these regulations, radio and 
television. In the case of radio and television broadcasting, the 
broadcast shall be pre-recorded and the practitioner shall retain a 
recording of the actual audio transmission.
    (e) Improper associations. An attorney, certified public accountant 
or enrolled practitioner may, in matters related to the Bureau, employ 
or accept employment or assistance as an associate, correspondent, or 
subagent from, or share fees with, any person or entity who, to the 
knowledge of the practitioner, obtains clients or otherwise practices in 
a manner forbidden under this section: Provided, That an attorney, 
certified public accountant or enrolled practitioner does not, directly 
or indirectly, act or hold himself out as authorized to practice before 
the Bureau in connection with that relationship. Nothing herein shall 
prohibit an attorney, certified public accountant, or enrolled 
practitioner from practice before the Bureau in a capacity other than 
that described above.

[44 FR 47060, Aug. 10, 1979]



Sec. 8.42  Practice of law.

    Nothing in the regulations in this part may be construed as 
authorizing persons not members of the bar to practice law.



                   Subpart E--Disciplinary Proceedings



Sec. 8.51  Authority to disbar or suspend.

    The Secretary, after due notice and opportunity for hearing, may 
suspend or disbar from practice before the Bureau any attorney, 
certified public accountant, or enrolled practitioner shown to be 
incompetent, disreputable or who refuses to comply with the rules and 
regulations in this part or who shall, with intent to defraud, in any 
manner willfully and knowingly deceive, mislead, or threaten any client

[[Page 176]]

or prospective client, by word, circular, letter, or by advertisement.

(Sec. 3, 23 Stat. 258 (31 U.S.C. 1026))



Sec. 8.52  Disreputable conduct.

    Disreputable conduct for which an attorney, certified public 
accountant, or enrolled practitioner may be disbarred or suspended from 
practice before the Bureau includes, but is not limited to:
    (a) Conviction of any criminal offense under the revenue laws of the 
United States; under any other law of the United States which the Bureau 
enforces pursuant to Treasury Department Order No. 221 (37 FR 11696) 
effective July 1, 1972; or for any offense involving dishonesty or 
breach of trust.
    (b) Giving false or misleading information, or participating in any 
way in the giving of false or misleading information, to the Bureau or 
any officer or employee thereof, or to any tribunal authorized to pass 
upon matters administered by the Bureau in connection with any matter 
pending or likely to be pending before them, knowing the information to 
be false or misleading. Facts or other matters contained in testimony, 
Federal tax returns, financial statements, applications for enrollment, 
affidavits, declarations, or any other document or statement, written or 
oral, are included in the term ``information''.
    (c) Solicitation of employment as prohibited under Sec. 8.41, the 
use of false or misleading representations with intent to deceive a 
client or a prospective client in order to procure employment, or 
intimating that the practitioner is able improperly to obtain special 
consideration or action from the Bureau or an officer or employee 
thereof.
    (d) Willfully failing to make a Federal tax return in violation of 
the revenue laws of the United States, or evading, attempting to evade, 
or participating in any way in evading or attempting to evade any 
Federal tax or payment thereof; knowingly counseling or suggesting to a 
client or prospective client an illegal plan to evade Federal taxes or 
payment thereof, or concealing assets of himself or herself, or of 
another in order to evade Federal taxes or payment thereof.
    (e) Misappropriation of, or failure properly and promptly to remit 
funds received from a client for the purpose of payment of taxes or 
other obligations due the United States.
    (f) Directly or indirectly attempting to influence, or offering or 
agreeing to attempt to influence, the official action of any officer or 
employee of the Bureau by the use of threats, false accusations, duress 
or coercion, by the offer of any special inducement or promise of 
advantage or by the bestowing of any gift, favor, or thing of value.
    (g) Disbarment or suspension from practice as an attorney or 
certified public accountant by any duly constituted authority of any 
State, possession, Commonwealth, the District of Columbia, or by any 
Federal court of record.
    (h) Disbarment or suspension from practice as an attorney, certified 
public accountant, or other person admitted to practice before the 
Internal Revenue Service.
    (i) Knowingly aiding and abetting another person to practice before 
the Bureau during a period of suspension, disbarment, or ineligibility 
of the other person. Maintaining a partnership for the practice of law, 
accountancy, or other related professional service with a person who is 
under disbarment from practice before the Bureau or the Intenal Revenue 
Service is presumed to be a violation of this provision.
    (j) Contemptuous conduct in connection with practice before the 
Bureau, including the use of abusive language, making false accusations 
and statements knowing them to be false, or circulating or publishing 
malicious or libelous matter.
    (k) Willful violatin of any of the regulations contained in this 
part.

[42 FR 33026, June 29, 1977; 42 FR 36455, July 15, 1977]



Sec. 8.53  Initiation of disciplinary proceedings.

    (a) Receipt of information. If an officer or employee of the Bureau 
has reason to believe that an attorney, certified public accountant, or 
enrolled practitioner has violated any of the provisions of this part or 
engaged in any disreputable conduct as defined in Sec. 8.52, the 
employee shall promptly make a

[[Page 177]]

report thereof which will be forwarded to the Director of Practice. Any 
other person possessing information concerning violations or 
disreputable conduct may make a report thereof to the Director of 
Practice or to any officer or employee of the Bureau.
    (b) Institution of proceeding. When the Director of Practice has 
reason to believe that any attorney, certified public accountant, or 
enrolled practitioner has violated any provisions of the laws or 
regulations governing practice before the Bureau, he or she may 
reprimand the person or institute a proceeding for the disbarment or 
suspension of that person. The proceeding will be instituted by a 
complaint which names the respondent and is signed by the Director of 
Practice and filed in his or her office. Except in cases of willfulness, 
or when time, the nature of the proceeding, or the public interest does 
not permit, the Director of Practice may not institute a proceeding 
until he or she has called to the attention of the proposed respondent, 
in writing, facts or conduct which warrant institution of a proceeding, 
and has accorded the proposed respondent the opportuity to demonstrate 
or achieve compliance with all lawful requirements.



Sec. 8.54  Conferences.

    (a) General. The Director of Practice may confer with an attorney, 
certified public accountant, or enrolled practioner concerning 
allegations of misconduct whether or not a proceeding for disbarment or 
suspension has been instituted. If a conference results in a stipulation 
in connection with a proceeding in which that person is the respondent, 
the stipulaton may be entered in the record at the instance of either 
party to the proceeding.
    (b) Resignation or voluntary suspension. An attorney, certified 
public accountant, or enrolled practitioner, in order to avoid the 
institution or conclusion of a disbarment or suspension proceeding, may 
offer his or her consent to suspension from practice before the Bureau. 
An enrolled practitioner may also offer a resignation. The Director of 
Practice, at his or her discretion, may accept the offered resignation 
of an enrolled practitioner and may suspend an attorney, certified 
public accountant, or enrolled practitioner in accordance with the 
consent offered.



Sec. 8.55  Contents of complaint.

    (a) Charges. A complaint will give a plain and concise description 
of the allegations which constitute the basis for the proceeding. A 
complaint will be deemed sufficient if it fairly informs the respondent 
of the charges to that he or she is able to prepare a defense.
    (b) Demand for answer. The complaint will give notification of the 
place and time prescribed for the filing of an answer by the respondent; 
that time will be not less than 15 days from the date of service of the 
complaint. Notice will be given that a decision by default may be 
rendered against the respondent if the complaint is not answered as 
required.



Sec. 8.56  Service of complaint and other papers.

    (a) Complaint. A copy of the complaint may be served upon the 
respondent by certified mail or by first-class mail. The copy of the 
complaint may be delivered to the respondent or the respondent's 
attorney or agent of record either in person or by leaving it at the 
office or place of business of the respondent, attorney or agent, or the 
complaint may be delivered in any manner which has been agreed to by the 
respondent. If the service is by certified mail, the post office receipt 
signed by or on behalf of the respondent will be proof of service. If 
the certified matter is not claimed or accepted by the respondent and is 
returned undelivered, complete service may be made upon the respondent 
by mailing the complaint to him or her by first-class mail, addressed to 
the respondent at the address under which he or she is enrolled or at 
the last address known to the Director of Practice. If service is made 
upon the respondent or the respondent's attorney or agent in person, or 
by leaving the complaint at the office or place of business of the 
respondent, attorney or agent, the verified return by the person making 
service, setting forth the manner of service, will be proof of service.
    (b) Service of other papers. Any paper other than the complaint may 
be

[[Page 178]]

served upon an attorney, certified public accountant, or enrolled 
practitioner as provided in paragraph (a) of this section, or by mailing 
the paper by first-class mail to the respondent at the last address 
known to the Director of Practice, or by mailing the paper by first-
class mail to the respondent's attorney or agent of record. This mailing 
will constitute complete service. Notices may be served upon the 
respondent or his attorney or agent by telegram.
    (c) Filing of papers. When the filing of a paper is required or 
permitted in connection with a disbarment or suspension proceeding, and 
the place of filing is not specified by this subpart or by rule or order 
of the Administrative Law Judge, the papers will be filed with the 
Director of Practice, Treasury Department, Washington, DC 20220. All 
papers will be filed in duplicate.



Sec. 8.57  Answer.

    (a) Filing. The respondent shall file the answer in writing within 
the time specified in the complaint or notice of institution of the 
proceeding, unless on application the time is extended by the Director 
of Practice or the Administrative Law Judge. The respondent shall file 
the answer in duplicate with the director of Practice.
    (b) Contents. The respondent shall include in the answer a statement 
of facts which constitute the grounds of defense, and shall specifically 
admit or deny each allegation set forth in the complaint, except that 
the respondent shall not deny a material allegation in the complaint 
which he or she knows to be true, or state that he or she is without 
sufficient information to form a belief when in fact the respondent 
possesses that information. The respondent may also state affirmatively 
special matters of defense.
    (c) Failure to deny or answer allegations in the complaint. Every 
allegation in the complaint which is not denied in the answer is deemed 
to be admitted and may be considered as proven, and no further evidence 
in respect of that allegation need be adduced at a hearing. Failure to 
file an answer within the time prescribed in the notice to the 
respondent, except as the time for answer is extended by the Director of 
Practice or the Administrative Law Judge, will constitute an admission 
of the allegations of the complaint and a waiver of hearing, and the 
Administrative Law Judge may make a decision by default without a 
hearing or further procedure.
    (d) Reply by Director of Practice. No reply to the respondent's 
answer is required, and new matter in the answer will be deemed to be 
denied, but the Director of Practice may file a reply at his or her 
discretion or at the request of the Administrative Law Judge.



Sec. 8.58  Supplemental charges.

    If it appears that the respondent in his or her answer, falsely and 
in bad faith, denies a material allegation of fact in the complaint or 
states that the respondent has no knowledge sufficient to form a belief, 
when he or she in fact possesses that information, or if it appears that 
the respondent has knowingly introduced false testimony during 
proceedings for his or her disbarment or suspension, the Director of 
Practice may file supplemental charges against the respondent. These 
supplemental charges may be tried with other charges in the case, 
provided the respondent is given due notice and is afforded an 
opportunity to prepare to a defense to them.



Sec. 8.59  Proof; variance; amendment of pleadings.

    In the case of a variance between the allegations in a pleading, the 
Administrative Law Judge may order or authorize amendment of the 
pleading to conform to the evidence. The party who would otherwise be 
prejudiced by the amendment will be given reasonable opportunty to meet 
the allegation of the pleading as amended, and the Administrative Law 
Judge shall make findings on an issue presented by the pleadings as so 
amended.



Sec. 8.60  Motions and requests.

    Motions and requests may be filed with the Director of Practice or 
with the Administrative Law Judge.



Sec. 8.61  Representation.

    A respondent or proposed respondent may appear in person or be 
represented by counsel or other representative who need not be enrolled 
to practice before

[[Page 179]]

the Bureau. The Director of Practice may be represented by an Attorney 
or other employee of the Treasury Department.



Sec. 8.62  Administrative Law Judge.

    (a) Appointment. An Administrative Law Judge, appointed as provided 
by 5 U.S.C. 3105, shall conduct proceedings upon complaints for the 
disbarment or suspension of attorneys, certified public accountants, or 
enrolled practitioners.
    (b) Responsibilities. The Administrative Law Judge in connection 
with any disbarment or suspension proceeding shall have authority to:
    (1) Administer oaths and affirmation;
    (2) Make rulings upon motions and requests; these rulings may not be 
appealed prior to the close of the hearing except at the discretion of 
the Administrative Law Judge in extraordinary circumstances;
    (3) Rule upon offers of proof, receive relevant evidence, and 
examine witnesses;
    (4) Take or authorize to the taking of depositions;
    (5) Determine the time and place of hearing and regulate its course 
and conduct;
    (6) Hold or provide for the holding of conferences to settle or 
simplify the issues by consent of the parties;
    (7) Receive and consider oral or written arguments on facts or law;
    (8) Make initial decisions;
    (9) Adopt rules of procedure and modify them from time to time as 
occasion requires for the orderly disposition of proceedings; and
    (10) Perform acts and take measures as necessary to promote the 
efficient conduct of any proceeding.



Sec. 8.63  Hearings.

    (a) Conduct. The Administrative Law Judge shall preside at the 
hearing on a complaint for the disbarment or suspension of an attorney, 
certified public accountant, or enrolled practitioner. Hearings will be 
stenographically recorded and transcribed and the testimony of witnesses 
will be received under oath or affirmation. The Administrative Law Judge 
shall conduct hearings pursuant to 5 U.S.C. 556.
    (b) Failure to appear. If either party to the proceedings fails to 
appear at the hearing, after due notice has been sent, the 
Administrative Law Judge may deem them to have waived the right to a 
hearing and may make a decision against the absent party by default.



Sec. 8.64  Evidence.

    (a) Rules of evidence. The rules of evidence prevailing in courts of 
law and equity are not controlling in hearings. However, the 
Administrative Law Judge shall exclude evidence which is irrelevant, 
immaterial, or unduly repetitious.
    (b) Depositions. Depositions of witnesses taken pursuant to Sec.  
8.65 may be admitted as evidence.
    (c) Government documents. Official documents, records, and papers of 
the Bureau of Alcohol, Tobacco and Firearms and the Office of the 
Director of Practice are admissible in evidence without the prouction of 
an officer or employee to authenticate them. These documents, records 
and papers may be evidenced by a copy attested or identified by an 
officer or employee of the Bureau or the Treasury Department.
    (d) Exhibits. If any document, record, or other paper is introduced 
in evidence as an exhibit, the Administrative Law Judge may authorize 
the withdrawal of the exhibit subject to any conditions he or she deems 
proper.
    (e) Objections. Objections to evidence will be in short form, 
stating the grounds of objection and the record may not include 
arguments thereon, except as ordered by the Administrative Law Judge. 
Rulings on objections will be a part of the record. No exception to the 
ruling is necessary to preserve the rights of the parties.



Sec. 8.65  Depositions.

    Depositions for use at a hearing may, with the written approval of 
the Administrative Law Judge, be taken by either the Director of 
Practice or the respondent or their authorized representatives. 
Depositions may be taken upon oral or written questioning, upon not less 
than 10 days' written notice to the other party before any officer 
authorized to administer an oath for general purposes or before an 
officer or

[[Page 180]]

employee of the Bureau authorized to administer an oath pursuant to 27 
CFR 70.35. The written notice will state the names of the witnesses and 
the time and place where the depositions are to be taken. The 
requirement of 10 days' notice may be waived by the parties in writing, 
and depositions may then be taken from the persons and at the times and 
places mutually agreed to by the parties. When a deposition is taken 
upon written questioning, any cross-examination will be upon written 
questioning. Copies of the written questioning will be served upon the 
other party with the notice, and copies of any written cross-
interrogation will be mailed or delivered to the opposing party at least 
5 days before the date of taking the depositions, unless the parties 
mutually agree otherwise. A party on whose behalf a deposition is taken 
must file it with the Administrative Law Judge and serve one copy upon 
the opposing party. Expenses in the reproduction of depositions will be 
borne by the party at whose instance the deposition is taken.



Sec. 8.66  Transcript.

    In cases in which the hearing is stenographically reported by a 
Government contract reporter, copies of the transcript may be obtained 
from the reporter at rates not to exceed the maximum rates fixed by 
contract between the Government and the reporter. If the hearing is 
stenographically reported by a regular employee of the Bureau, a copy of 
the hearing will be supplied to the respondent either without charge or 
upon the payment of a reasonable fee. Copies of exhibits introduced at 
the hearing or at the taking of depositions will be supplied to the 
parties upon the payment of a reasonable fee.

(Sec. 501, Pub. L. 82-137, 65 Stat. 290 (31 U.S.C. 483a))



Sec. 8.67  Proposed findings and conclusions.

    Except in cases when the respondent has failed to answer the 
complaint or when a party has failed to appear at the hearing, the 
Administrative Law Judge, prior to making his or her decision, shall 
afford the parties a reasonable opportunity to submit proposed findings 
and conclusions and their supporting reasons.



Sec. 8.68  Decision of Administrative Law Judge.

    As soon as practicable after the conclusion of a hearing and the 
receipt of any proposed findings and conclusions timely submitted by the 
parties, the Administrative Law Judge shall make the initial decision in 
the case. The decision will include (a) a statement of findings and 
conclusions, as well as the reasons or basis therefor, upon all the 
material issues of fact, law, or discretion presented on the record, and 
(b) an order of disbarment, suspension, or reprimand or an order of 
dismissal of the complaint. The Administrative Law Judge shall file the 
decision with the Director of Practice and shall transmit a copy to the 
respondent or the respondent's attorney of record. In the absence of an 
appeal to the Secretary, or review of the decision upon motion of the 
Secretary, the decision of the Administrative Law Judge will, without 
further proceedings, become the decision of the Secretary of the 
Treasury 30 days from the date of the Administrative Law Judge's 
decision.



Sec. 8.69  Appeal to the Secretary.

    Within 30 days from the date of the Administrative Law Judge's 
decision, either party may appeal to the Secretary. The appeal will be 
filed with the Director of Practice in duplicate and will include 
exceptions to the decision of the Administrative Law Judge and 
supporting reasons for those exceptions. If the Director of Practice 
files the appeal, he or she shall transmit a copy of it to the 
respondent. Within 30 days after receipt of an appeal or copy thereof, 
the other party may file a reply brief in duplicate with the Director of 
Practice. If the Director of Practice files the reply brief, he or she 
shall transmit a copy of it to the respondent. Upon the filing of an 
appeal and a reply brief, if any, the Director of Practice shall 
transmit the entire record to the Secretary.



Sec. 8.70  Decision of the Secretary.

    On appeal from or review of the intial decision of the 
Administrative Law Judge, the Secretary shall make the

[[Page 181]]

agency decision. In making this decision, the Secretary shall review the 
record or those portions of the records as may be cited by the parties 
in order to limit the issues. The Director of Prasctice shall transmit a 
copy of the Secretary's decision to the respondent.



Sec. 8.71  Effect of disbarment or suspension.

    (a) Disbarment. If the final order against the respondent is for 
disbarment, the respondent will not thereafter be permitted to practice 
before the Bureau unless authorized to do so by the Director of Practice 
pursuant to Sec. 8.72.
    (b) Suspension. If the final order against the respondent is for 
suspension, the respondent will not thereafter be permitted to practice 
before the Bureau during the period of suspension.
    (c) Surrender of enrollment card. If an enrolled practitioner is 
disbarred or suspended, he or she shall surrender the enrollment card to 
the Director of Practice for cancellation, in the case of disbarment, or 
for retention during the period of suspension.
    (d) Notice of disbarment or suspension. Upon the issuance of a final 
order for suspension or disbarment, the Director of Practice shall give 
notice of the order to appropriate officers and employees of the Bureau 
of Alcohol, Tobacco and Firearms and to interested departments and 
agencies of the Federal Government. The Director of Practice may also 
give notice as he or she may determine to the proper authorities of the 
State in which the disbarred or suspended person was licensed to 
practice as an attorney or certified public accountant.



Sec. 8.72  Petition for reinstatement.

    The Director of Practice may entertain a petition for reinstatement 
from any person disbarred from practice before the Bureau after the 
expiration of 5 years following disbarment. The director of Practice may 
not grant reinstatement unless he or she is satisfied that the 
petitioner is not likely to conduct himself or herself contrary to the 
regulations in this part, and that granting reinstatement would not be 
contrary to the public interest.



PART 9--EFFECTS OF IMPORTED ARTICLES ON THE NATIONAL SECURITY--Table of Contents




Sec.
9.2  Definitions.
9.3  General.
9.4  Criteria for determining effects of imports on national security.
9.5  Applications for investigation.
9.6  Confidential information.
9.7  Conduct of investigation.
9.8  Emergency action.
9.9  Report.

    Authority: Sec. 232, as amended, 76 Stat. 877, 80 Stat. 369 (19 
U.S.C. 1862); 5 U.S.C. 301; Reorg. Plan No. 1 of 1973; and E.O. 11725, 
June 27, 1973 (38 FR 17175).



Sec. 9.2  Definitions.

    As used herein, Secretary means the Secretary of the Treasury and 
Assistant Secretary means the Assistant Secretary of the Treasury 
(Enforcement, Operations, and Tariff Affairs).

[40 FR 50717, Oct. 31, 1975]



Sec. 9.3  General.

    (a) Upon request of the head of any Government department or agency, 
upon application of an interested party, or upon his own motion, the 
Assistant Secretary shall set in motion an immediate investigation to 
determine the effects on the national security of imports of any 
article.
    (b) The Secretary shall report the findings of his investigation 
under paragraph (a) of this section with respect to the effect of the 
importation of such article in such quantities or under such 
circumstances upon the national security and, based on such findings, 
his recommendation for action or inaction to the President within one 
year after receiving an application from an interested party or 
otherwise beginning an investigation under this section.

[39 FR 10898, Mar. 22, 1974, as amended at 40 FR 50717, Oct. 31, 1975]



Sec. 9.4  Criteria for determining effects of imports on national security.

    (a) In determining the effect on the national security of imports of 
the article which is the subject of the investigation, the Secretary is 
required to take into consideration the following:

[[Page 182]]

    (1) Domestic production needed for projected national defense 
requirements including restoration and rehabilitation.
    (2) The capacity of domestic industries to meet such projected 
requirements, including existing and anticipated availabilities of:
    (i) Human resources.
    (ii) Products.
    (iii) Raw materials.
    (iv) Production equipment and facilities.
    (v) Other supplies and services essential to the national defense.
    (3) The requirement of growth of such industries and such supplies 
and services including the investment, exploration and development 
necessary to assure capacity to meet projected defense requirements.
    (4) The effect which the quantities, availabilities, character and 
uses of imported goods have or will have on such industries and the 
capacity of the United States to meet national security requirements.
    (5) The economic welfare of the Nation as it is related to our 
national security, including the impact of foreign competition on the 
economic welfare of individual domestic industries. In determining 
whether such impact may impair the national security, any substantial 
unemployment, decrease in revenues of government, loss of skills or 
investment, or other serious effects shall be considered.
    (b) The Secretary shall also consider other relevant factors in 
determining whether the national security is affected by imports of the 
article.

[39 FR 10898, Mar. 22, 1974]



Sec. 9.5  Applications for investigation.

    (a) Applications shall be in writing. Twenty-five copies shall be 
filed by mail with the Assistant Secretary (Enforcement, Operations, and 
Tariff Affairs), Department of the Treasury, Washington, DC 20220.
    (b) Applications shall describe how the quantities or circumstances 
of imports of the particular article affect the national security and 
shall contain the following information:
    (1) Identification of the person, partnership, association, 
corporation, or other entity on whose behalf the application is filed.
    (2) A precise description of the article.
    (3) Description of the applicant and the domestic industry 
concerned, including pertinent information regarding companies and their 
plants, locations, capacity and current output of the domestic industry 
concerned with the article in question.
    (4) Pertinent statistics showing the quantities and values of both 
imports and production in the United States.
    (5) Nature, sources, and degree of the competition created by 
imports of the article in question.
    (6) The effect, if any, of imports of the article in question upon 
the restoration of domestic production capacity in an emergency.
    (7) Employment and special skills involved in the domestic 
production of the article.
    (8) Extent to which investment and specialized productive capacity 
is or will be adversely affected.
    (9) Revenues of Federal, State, or local Governments which are or 
may be affected by the volume or circumstances of imports of the 
article.
    (10) Defense or defense supporting uses of the article including 
data on defense contracts or sub-contracts, both past and current.
    (c) Statistical material presented should be on a calendar-year 
basis for sufficient periods of time to indicate trends and afford the 
greatest possible assistance to the Assistant Secretary. Monthly or 
quarterly data for the latest complete years should be included as well 
as any other breakdowns which may be pertinent to show seasonal or 
short-term factors.

[39 FR 10898, Mar. 22, 1974, as amended at 40 FR 50717, Oct. 31, 1975]



Sec. 9.6  Confidential information.

    Information submitted in confidence which the Assistant Secretary 
determines would disclose trade secrets and commercial or financial 
information obtained from a person and privileged, within the meaning of 
5 U.S.C. 552 and 31 CFR part 1, will be accorded confidential treatment. 
All information submitted in confidence must be on

[[Page 183]]

separate pages marked ``Business Confidential.''

[40 FR 50717, Oct. 31, 1975]



Sec. 9.7  Conduct of investigation.

    (a) The investigation by the Assistant Secretary or by such official 
or agency as he may designate, shall be such as to enable the Secretary 
to arrive at a fully informed opinion as to the effect on the national 
security of imports of the article in question.
    (b) If the Assistant Secretary determines that it is appropriate to 
hold public hearings or otherwise afford interested parties an 
opportunity to present information and advice relevant to an 
investigation, he shall issue a public notice which shall be published 
in the Federal Register. Such notice shall include a statement of the 
time, place and nature of any public hearing or shall solicit from any 
interested party written comments, opinions, or data relative to the 
investigation, to be submitted to the Assistant Secretary within the 
time period specified in the notice. Rebuttal to material so submitted 
may be filed with the Assistant Secretary within such time as is 
specified in the public notice. All data, comments and opinions shall be 
submitted with 25 copies.
    (c) All applications filed and all comments, opinions, and data 
submitted pursuant to paragraph (b) of this section, except information 
determined to be confidential as provided in Sec. 9.6, will be available 
for inspection and copying at the Office of the Assistant Secretary 
(Enforcement, Operations, and Tariff Affairs), Department of the 
Treasury, in Washington, DC. The Assistant Secretary will maintain a 
roster of persons who have submitted materials.
    (d) The Assistant Secretary or his designee may also request further 
data from other sources through the use of questionnaires, 
correspondence, or other means.
    (e) The Assistant Secretary or his delegate shall, in the course of 
the investigation, seek information or advice from, and consult with, 
the Secretary of Defense, the Secretary of Commerce, or their delegates, 
and any other appropriate officer of the United States as the Assistant 
Secretary shall determine.
    (f) In addition, the Assistant Secretary, or his designee, may, when 
he deems it appropriate, hold public hearings to elicit further 
information. If a hearing is held:
    (1) The time and place thereof will be published in the Federal 
Register.
    (2) It will be conducted by the Assistant Secretary or his designee, 
and the full record will be considered by the Secretary in arriving at 
his determination.
    (3) Interested parties may appear, either in person or by 
representation, and produce oral or written evidence relevant and 
material to the subject matter of the investigation.
    (4) After a witness has testified the Assistant Secretary or his 
designee may question the witness. Questions submitted to the Assistant 
Secretary or his designee in writing by any interested party may, at the 
discretion of the Assistant Secretary or his designee, be posed to the 
witness for reply for the purpose of assisting the Assistant Secretary 
in obtaining the material facts with respect to the subject matter of 
the investigation.
    (5) The hearing will be stenographically reported. The Assistant 
Secretary will not cause transcripts of the record of the hearing to be 
distributed to the interested parties, but a transcript may be inspected 
at the Office of the Assistant Secretary (Enforcement, Operations, and 
Tariff Affairs), Department of the Treasury, in Washington, DC, or 
purchased from the reporter.

[39 FR 10898, Mar. 22, 1974, as amended at 40 FR 50717, Oct. 31, 1975]



Sec. 9.8  Emergency action.

    In emergency situations or when in his judgment national security 
interests require it, the Secretary may vary or dispense with any of the 
procedures set forth above and may formulate his views without following 
such procedures.

[39 FR 10898, Mar. 22, 1974]



Sec. 9.9  Report.

    A report will be made and published in the Federal Register upon the 
disposition of each request, application or motion under Sec. 9.3. 
Copies of the report will be available at the Office of the

[[Page 184]]

Assistant Secretary (Enforcement, Operations, and Tariff Affairs), 
Department of the Treasury.

[40 FR 50718, Oct. 31, 1975]



PART 10--PRACTICE BEFORE THE INTERNAL REVENUE SERVICE--Table of Contents




Sec.
10.0  Scope of part.

            Subpart A--Rules Governing Authority to Practice

10.1  Director of Practice.
10.2  Definitions.
10.3  Who may practice.
10.4  Eligibility for enrollment.
10.5  Application for enrollment.
10.6  Enrollment.
10.7  Representing oneself; participating in rulemaking; limited 
          practice; special appearances; and return preparation.
10.8  Customhouse brokers.

   Subpart B--Duties and Restrictions Relating to Practice Before the 
                        Internal Revenue Service

10.20  Information to be furnished.
10.21  Knowledge of client's omission.
10.22  Diligence as to accuracy.
10.23  Prompt disposition of pending matters.
10.24  Assistance from disbarred or suspended persons and former 
          Internal Revenue Service employees.
10.25  Practice by partners of Government employees.
10.26  Practice by former Government employees, their partners and their 
          associates.
10.27  Notaries.
10.28  Fees.
10.29  Conflicting interests.
10.30  Solicitation.
10.31  Negotiation of taxpayer refund checks.
10.32  Practice of law.
10.33  Tax shelter opinions.
10.34  Standards for advising with respect to tax return positions and 
          for preparing or signing returns.

         Subpart C--Rules Applicable to Disciplinary Proceedings

10.50  Authority to disbar or suspend.
10.51  Disreputable conduct.
10.52  Violation of regulations.
10.53  Receipt of information concerning attorney, certified public 
          accountant, enrolled agent, or enrolled actuary.
10.54  Institution of proceeding.
10.55  Conferences.
10.56  Contents of complaint.
10.57  Service of complaint and other papers.
10.58  Answer.
10.59  Supplemental charges.
10.60  Reply to answer.
10.61  Proof; variance; amendment of pleadings.
10.62  Motions and requests.
10.63  Representation.
10.64  Administrative Law Judge.
10.65  Hearings.
10.66  Evidence.
10.67  Depositions.
10.68  Transcript.
10.69  Proposed findings and conclusions.
10.70  Decision of the Administrative Law Judge.
10.71  Appeal to the Secretary.
10.72  Decision of the Secretary.
10.73  Effect of disbarment or suspension; surrender of card.
10.74  Notice of disbarment or suspension.
10.75  Petition for reinstatement.
10.76  Expedited suspension upon criminal conviction or loss of license 
          for cause.

      Subpart D--Rules Applicable to Disqualification of Appraisers

10.77  Authority to disqualify; effect of disqualification.
10.78  Institution of proceeding.
10.79  Contents of complaint.
10.80  Service of complaint and other papers.
10.81  Answer.
10.82  Supplemental charges.
10.83  Reply to answer.
10.84  Proof, variance, amendment of pleadings.
10.85  Motions and requests.
10.86  Representation.
10.87  Administrative Law Judge.
10.88  Hearings.
10.89  Evidence.
10.90  Depositions.
10.91  Transcript.
10.92  Proposed findings and conclusions.
10.93  Decision of the Administrative Law Judge.
10.94  Appeal to the Secretary.
10.95  Decision of the Secretary.
10.96  Final order.
10.97  Petition for reinstatement.

                      Subpart E--General Provisions

10.98  Records.
10.100  Saving clause.
10.101  Special orders.

    Authority: Sec. 3, 23 Stat. 258, secs. 2-12, 60 Stat. 237 et seq.; 5 
U.S.C. 301, 500, 551-559, 31 U.S.C. 1026; Reorg. Plan No. 26 of 1950, 15 
FR 4935, 64 Stat. 1280, 3 CFR, 1949-1953 Comp., p. 1017.

    Source: Department Circular 230, Revised, 31 FR 10773, Aug. 13, 
1966, unless otherwise noted.

[[Page 185]]


    Editorial Note: Nomenclature changes affecting this part appear at 
57 FR 41095, Sept. 9, 1992.



Sec. 10.0  Scope of part.

    This part contains rules governing the recognition of attorneys, 
certified public accountants, enrolled agents, and other persons 
representing clients before the Internal Revenue Service. Subpart A of 
this part sets forth rules relating to authority to practice before the 
Internal Revenue Service; subpart B of this part prescribes the duties 
and restrictions relating to such practice; subpart C of this part 
contains rules relating to disciplinary proceedings; subpart D of this 
part contains rules applicable to disqualification of appraisers; and 
Subpart E of this part contains general provisions, including provisions 
relating to the availability of official records.

[59 FR 31526, June 20, 1994]



            Subpart A--Rules Governing Authority To Practice



Sec. 10.1  Director of Practice.

    (a) Establishment of office. There is established in the Office of 
the Secretary of the Treasury the office of Director of Practice. The 
Director of Practice shall be appointed by the Secretary of the 
Treasury.
    (b) Duties. The Director of Practice shall act upon applications for 
enrollment to practice before the Internal Revenue Service; institute 
and provide for the conduct of disciplinary proceedings relating to 
attorneys, certified public accountants, enrolled agents, enrolled 
actuaries and appraisers; make inquiries with respect to matters under 
his jurisdiction; and perform such other duties as are necessary or 
appropriate to carry out his functions under this part or as are 
prescribed by the Secretary of the Treasury.
    (c) Acting Director. The Secretary of the Treasury will designate an 
officer or employee of the Treasury Department to act as Director of 
Practice in the event of the absence of the director or of a vacancy in 
that office.

[31 FR 10773, Aug. 13, 1966, as amended at 51 FR 2878, Jan. 22, 1986]



Sec. 10.2  Definitions.

    As used in this part, except where the context clearly indicates 
otherwise:
    (a) Attorney means any person who is a member in good standing of 
the bar of the highest court of any State, possession, territory, 
Commonwealth, or the District of Columbia.
    (b) Certified Public Accountant means any person who is duly 
qualified to practice as a certified public accountant in any State, 
possession, territory, Commonwealth, or the District of Columbia.
    (c) Commissioner refers to the Commissioner of Internal Revenue.
    (d) Director refers to the Director of Practice.
    (e) Practice before the Internal Revenue Service comprehends all 
matters connected with a presentation to the Internal Revenue Service or 
any of its officers or employees relating to a client's rights, 
privileges, or liabilities under laws or regulations administered by the 
Internal Revenue Service. Such presentations include preparing and 
filing necessary documents, corresponding and communicating with the 
Internal Revenue Service, and representing a client at conferences, 
hearings, and meetings.
    (f) Practitioner means any individual described in Sec. 10.3 (a), 
(b), (c), or (d) of this part.
    (g) A return includes an amended return and a claim for refund.
    (h) Service means the Internal Revenue Service.

[59 FR 31526, June 20, 1994]



Sec. 10.3  Who may practice.

    (a) Attorneys. Any attorney who is not currently under suspension or 
disbarment from practice before the Internal Revenue Service may 
practice before the Service upon filing with the Service a written 
declaration that he or she is currently qualified as an attorney and is 
authorized to represent the particular party on whose behalf he or she 
acts.
    (b) Certified public accountants. Any certified public accountant 
who is not currently under suspension or disbarment from practice before 
the Internal Revenue Service may practice before

[[Page 186]]

the Service upon filing with the Service a written declaration that he 
or she is currently qualified as a certified public accountant and is 
authorized to represent the particular party on whose behalf he or she 
acts.
    (c) Enrolled agents. Any person enrolled as an agent pursuant to 
this part may practice before the Internal Revenue Service.
    (d) Enrolled Actuaries. (1) Any individual who is enrolled as an 
actuary by the Joint Board for the Enrollment of Actuaries pursuant to 
29 U.S.C. 1242 may practice before the Internal Revenue Service upon 
filing with the Service a written declaration that he/she is currently 
qualified as an enrolled actuary and is authorized to represent the 
particular party on whose behalf he/she acts. Practice as an enrolled 
actuary is limited to representation with respect to issues involving 
the following statuatory provisions. Internal Revenue Code (Title 26 
U.S.C.) sections: 401 (qualification of employee plans), 403(a) 
(relating to whether an annuity plan meets the requirements of section 
404(a)(2)), 404 (deductibility of employer contributions), 405 
(qualification of bond purchase plans), 412 (funding requirements for 
certain employee plans), 413 (application of qualification requirements 
to collectively bargained plans and to plans maintained by more than one 
employer), 414 (containing definitions and special rules relating to the 
employee plan area), 4971 (relating to excise taxes payable as a result 
of an accumulated funding deficiency under section 412), 6057 (annual 
registration of plans), 6058 (information required in connection with 
certain plans of deferred compensation), 6059 (periodic report of 
actuary), 6652(e) (failure to file annual regustration and other 
notifications by pension plan), 6652(f) (failure to file information 
required in connection with certain plans of deferred compensation), 
6692 (failure to file acuarial report), 7805(b) (relating to the extent, 
if any, to which an Internal Revenue Service ruling or determination 
letter coming under the herein listed statutory provisions shall be 
applied without retroactive effect); and 29 U.S.C. 1083 (relating to 
waiver of funding for nonqualified plans).
    (2) An individual who practices before the Internal Revenue Service 
pursuant to this subsection shall be subject to the provisions of this 
part in the same manner as attorneys, certified public accountants and 
enrolled agents.
    (e) Others. Any individual qualifying under Sec. 10.5(c) or 
Sec. 10.7 is eligible to practice before the Internal Revenue Service to 
the extent provided in those sections.
    (f) Government officers and employees, and others. An individual, 
including an officer or employee of the executive, legislative, or 
judicial branch of the United States Government; officer or employee of 
the District of Columbia; Member of Congress; or Resident Commissioner, 
may not practice before the Service if such practice would violate 18 
U.S.C. 203 or 205.
    (g) State officers and employees. No officer or employee of any 
State, or subdivision thereof, whose duties require him to pass upon, 
investigate, or deal with tax matters of such State or subdivision, may 
practice before the Service, if such State employment may disclose facts 
or information applicable to Federal tax matters.

[31 FR 10773, Aug. 13, 1966, as amended at 35 FR 13205, Aug. 19, 1970; 
36 FR 8671, May 11, 1971; 44 FR 4946, Jan. 24, 1979; 59 FR 31526, June 
20, 1994]



Sec. 10.4  Eligibility for enrollment.

    (a) Enrollment upon examination. The Director of Practice may grant 
enrollment to an applicant who demonstrates special competence in tax 
matters by written examination administered by the Internal Revenue 
Service and who has not engaged in any conduct which would justify the 
suspension or disbarment of any attorney, certified public accountant, 
or enrolled agent under the provisions of this part.
    (b) Enrollment of former Internal Revenue Service employees. The 
Director of Practice may grant enrollment to an applicant who has not 
engaged in any conduct which would justify the suspension or disbarment 
of any attorney, certified public accountant, or enrolled agent under 
the provisions of this part and who, by virtue of his past service

[[Page 187]]

and technical experience in the Internal Revenue Service has qualified 
for such enrollment, as follows:
    (1) Application for enrollment on account of former employment in 
the Internal Revenue Service shall be made to the Director of Practice. 
Each applicant will be supplied a form by the Director of Practice, 
which shall indicate the information required respecting the applicant's 
qualifications. In addition to the applicant's name, address, 
citizenship, age, educational experience, etc., such information shall 
specifically include a detailed ascount of the applicant's employment in 
the Internal Revenue Service, which account shall show (i) positions 
held, (ii) date of each appointment and termination thereof, (iii) 
nature of services rendered in each position, with particular reference 
to the degree of technical experience involved, and (iv) name of 
supervisor in such positions, together with such other information 
regarding the experience and training of the applicant as may be 
relevant.
    (2) Upon receipt of each such application, it shall be transmitted 
to the appropriate officer of the Internal Revenue Service with the 
request that a detailed report of the nature and rating of the 
applicant's services in the Internal Revenue Service, accompanied by the 
recommendation of the superior officer in the particular unit or 
division of the Internal Revenue Service that such employment does or 
does not qualify the applicant technically or otherwise for the desired 
authorization, be furnished to the Director of Practice.
    (3) In examining the qualification of an applicant for enrollment on 
account of employment in the Internal Revenue Service, the Director of 
Practice will be governed by the following policies:
    (i) Enrollment on account of such employment may be of unlimited 
scope or may be limited to permit the presentation of matters only of 
the particular class or only before the particular unit or division of 
the Internal Revenue Service for which his former employment in the 
Internal Revenue Service has qualified the applicant.
    (ii) Application for enrollment on account of employment in the 
Internal Revenue Service must be made within 3 years from the date of 
separation from such employment.
    (iii) It shall be requisite for enrollment on account of such 
employment that the applicant shall have had a minimum of 5 years 
continuous employment in the Service during which he shall have been 
regularly engaged in applying and interpreting the provisions of the 
Internal Revenue Code and the regulations thereunder relating to income, 
estate, gift, employment, or excise taxes.
    (iv) For the purposes of paragraph (b)(3)(iii) of this section an 
aggregate of 10 or more years of employment, at least 3 of which 
occurred within the 5 years preceding the date of application, shall be 
deemed the equivalent of 5 years continuous employment.
    (c) Natural persons. Enrollment to practice may be granted only to 
natural persons.

[31 FR 10773, Aug. 13, 1966, as amended at 35 FR 13205, Aug. 19, 1970; 
42 FR 38352, July 28, 1977; 51 FR 2878, Jan. 22, 1986; 59 FR 31526, June 
20, 1994]



Sec. 10.5  Application for enrollment.

    (a) Form; fee. An applicant for enrollment shall file with the 
Director of Practice of Internal Revenue an application on Form 23, 
properly executed under oath or affirmation. Such application shall be 
accompanied by a check or money order in the amount set forth on Form 
23, payable to the Internal Revenue Service, which amount shall 
constitute a fee which shall be charged to each applicant for 
enrollment. The fee shall be retained by the United States whether or 
not the applicant is granted enrollment.
    (b) Additional information; examination. The Director of Practice, 
as a condition to consideration of an application for enrollment, may 
require the applicant to file additional information and to submit to 
any written or oral examination under oath or otherwise. The Director of 
Practice shall, upon written request, afford an applicant the 
opportunity to be heard with respect to his application for enrollment.
    (c) Temporary recognition. Upon receipt of a properly executed 
application, the Director of Practice may

[[Page 188]]

grant the applicant temporary recognition to practice pending a 
determination as to whether enrollment to practice should be granted. 
Such temporary recognition shall not be granted if the application is 
not regular on its face; if the information stated therein, if true, is 
not sufficient to warrant enrollment to practice; if there is any 
information before the Director of Practice which indicates that the 
statements in the application are untrue; or which indicates that the 
applicant would not otherwise qualify for enrollment. Issuance of 
temporary recognition shall not constitute enrollment to practice or a 
finding of eligibility for enrollment, and the temporary recognition may 
be withdrawn at any time by the Director of Practice.
    (d) Appeal from denial of application. The Director of Practice, in 
denying an application for enrollment, shall inform the applicant as to 
the reason(s) therefor. The applicant may, within 30 days after receipt 
of the notice of denial, file a written appeal therefrom, together with 
his/her reasons in support thereof, to the Secretary of the Treasury. A 
decision on the appeal will be rendered by the Secretary of the Treasury 
as soon as practicable.

(Sec. 501, Pub. L. 82-137, 65 Stat. 290; 31 U.S.C. 483a)

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38352, July 28, 1977; 
51 FR 2878 Jan. 22, 1986]



Sec. 10.6  Enrollment.

    (a) Roster. The Director of Practice shall maintain rosters of all 
individuals:
    (1) Who have been granted active enrollment to practice before the 
Internal Revenue Service;
    (2) Whose enrollment has been placed in an inactive status for 
failure to meet the requirements for renewal of enrollment;
    (3) Whose enrollment has been placed in an inactive retirement 
status;
    (4) Who have been disbarred or suspended from practice before the 
Internal Revenue Service;
    (5) Whose offer of consent to resignation from enrollment to 
practice before the Internal Revenue Service has been accepted by the 
Director of Practice under Sec. 10.55 of this part; and
    (6) Whose application for enrollment has been denied.
    (b) Enrollment card. The Director of Practice will issue an 
enrollment card to each individual whose application for enrollment to 
practice before the Internal Revenue Service is approved after the 
effective date of this regulation. Each such enrollment card will be 
valid for the period stated thereon. Enrollment cards issued individuals 
before February 1, 1987 shall become invalid after March 31, 1987. An 
individual having an invalid enrollment card is not eligible to practice 
before the Internal Revenue Service.
    (c) Term of enrollment. Active enrollment to practice before the 
Internal Revenue Service is accorded each individual enrolled, so long 
as renewal of enrollment is effected as provided in this part.
    (d) Renewal of enrollment. To maintain active enrollment to practice 
before the Internal Revenue Service, each individual enrolled is 
required to have his/her enrollment renewed as set forth herein. Failure 
by an individual to receive notification from the Director of Practice 
of the renewal requirement will not be justification for circumvention 
of such requirement.
    (1) All individuals enrolled to practice before the Internal Revenue 
Service before November 1, 1986 shall apply for renewal of enrollment 
during the period between November 1, 1986 and January 31, 1987. Those 
who receive initial enrollment between November 1, 1986 and January 31, 
1987 shall apply for renewal of enrollment by March 1, 1987. The first 
effective date of renewal will be April 1, 1987.
    (2) Thereafter, applications for renewal will be required between 
November 1, 1989 and January 31, 1990, and between November 1 and 
January 31 of every third year subsequent thereto. Those who receive 
initial enrollment during the renewal application period shall apply for 
renewal of enrollment by March 1 of the renewal year. The effective date 
of renewed enrollment will be April 1, 1990, and April 1 of every third 
year subsequent thereto.
    (3) The Director of Practice will notify the individual of renewal 
of enrollment and will issue a card evidencing such renewal.

[[Page 189]]

    (4) A reasonable nonrefundable fee may be charged for each 
application for renewal of enrollment filed with the Director of 
Practice.
    (5) Forms required for renewal may be obtained from the Director of 
Practice, Internal Revenue Service, Washington, DC 20224.
    (e) Condition for renewal: Continuing Professional Education. In 
order to qualify for renewal of enrollment, an individual enrolled to 
practice before the Internal Revenue Service must certify, on the 
application for renewal form prescribed by the Director of Practice, 
that he/she has satisfied the following continuing professional 
education requirements.
    (1) For renewed enrollment effective April 1, 1987. (i) A minimum of 
24 hours of continuing education credit must be completed between 
January 1, 1986 and January 31, 1987.
    (ii) An individual who receives initial enrollment between January 
1, 1986 and January 31, 1987 is exempt from the continuing education 
requirement for the renewal of enrollment effective April 1, 1987, but 
is required to file a timely application for renewal of enrollment.
    (2) For renewed enrollment effective April 1, 1990 and every third 
year thereafter. (i) A minimum of 72 hours of continuing education 
credit must be completed between February 1, 1987 and January 31, 1990, 
and during each three year period subsequent thereto. Each such three 
year period is known as an enrollment cycle.
    (ii) A minimum of 16 hours of continuing education credit must be 
completed in each year of an enrollment cycle.
    (iii) An individual who receives initial enrollment during an 
enrollment cycle must complete two (2) hours of qualifying continuing 
education credit for each month enrolled during such enrollment cycle. 
Enrollment for any part of a month is considered enrollment for the 
entire month.
    (f) Qualifying continuing education--(1) General. To qualify for 
continuing education credit, a course of learning must:
    (i) Be a qualifying program designed to enhance the professional 
knowledge of an individual in Federal taxation or Federal tax related 
matters, i.e. programs comprised of current subject matter in Federal 
taxation or Federal tax related matters to include accounting, financial 
management, business computer science and taxation; and
    (ii) Be conducted by a qualifying sponsor.
    (2) Qualifying programs--(i) Formal programs. Formal programs 
qualify as continuing education programs if they:
    (A) Require attendance;
    (B) Require that the program be conducted by a qualified instructor, 
discussion leader or speaker, i.e. a person whose background, training, 
education and/or experience is appropriate for instructing or leading a 
discussion on the subject matter of the particular program; and
    (C) Require a written outline and/or textbook and certificate of 
attendance provided by the sponsor, all of which must be retained by the 
attendee for a three year period following renewal of enrollment.
    (ii) Correspondence or individual study programs (including taped 
programs). Qualifying continuing education programs include 
correspondence or individual study programs completed on an individual 
basis by the enrolled individual and conducted by qualifying sponsors. 
The allowable credit hours for such programs will be measured on a basis 
comparable to the measurement of a seminar or course for credit in an 
accredited educational institution. Such programs qualify as continuing 
education programs if they:
    (A) Require registration of the participants by the sponsor;
    (B) Provide a means for measuring completion by the participants 
(e.g., written examination); and
    (C) Require a written outline and/or textbook and certificate of 
completion provided by the sponsor which must be retained by the 
participant for a three year period following renewal of enrollment.
    (iii) Serving as an instructor, discussion leader or speaker.
    (A) One hour of continuing education credit will be awarded for each 
contact

[[Page 190]]

hour completed as an instructor, discussion leader or speaker at an 
educational program which meets the continuing education requirements of 
this part.
    (B) Two hours of continuing education credit will be awarded for 
actual subject preparation time for each contact hour completed as an 
instructor, discussion leader or speaker at such programs. It will be 
the responsibility of the individual claiming such credit to maintain 
records to verify preparation time.
    (C) The maximum credit for instruction and preparation may not 
exceed 50% of the continuing education requirement for an enrollment 
cycle.
    (D) Presentation of the same subject matter in an instructor, 
discussion leader or speaker capacity more than one time during an 
enrollment cycle will not qualify for continuing education credit.
    (iv) Credit for published articles, books, etc.
    (A) Continuing education credit will be awarded for publications on 
Federal taxation or Federal tax related matters to include accounting, 
financial management, business computer science, and taxation, provided 
the content of such publications is current and designed for the 
enhancement of the professional knowledge of an individual enrolled to 
practice before the Internal Revenue Service.
    (B) The credit allowed will be on the basis of one hour credit for 
each hour of preparation time for the material. It will be the 
responsibility of the person claiming the credit to maintain records to 
verify preparation time.
    (C) The maximum credit for publications may not exceed 25% of the 
continuing education requirement of any enrollment cycle.
    (3) Periodic examination. Individuals may establish eligibility for 
renewal of enrollment for any enrollment cycle by:
    (i) Achieving a passing score on each part of the Special Enrollment 
Examination administered under this part during the three year period 
prior to renewal; and
    (ii) Completing a minimum of 16 hours of qualifying continuing 
education during the last year of an enrollment cycle.
    (g) Sponsors. (1) Sponsors are those responsible for presenting 
programs.
    (2) To qualify as a sponsor, a program presenter must:
    (i) Be an accredited educational institution;
    (ii) Be recognized for continuing education purposes by the 
licensing body of any State, possession, territory, Commonwealth, or the 
District of Columbia responsible for the issuance of a license in the 
field of accounting or law;
    (iii) Be recognized by the Director of Practice as a professional 
organization or society whose programs include offering continuing 
professional education opportunities in subject matter within the scope 
of this part; or
    (iv) File a sponsor agreement with the Director of Practice to 
obtain approval of the program as a qualified continuing education 
program.
    (3) A qualifying sponsor must ensure the program complies with the 
following requirements:
    (i) Programs must be developed by individual(s) qualified in the 
subject matter;
    (ii) Program subject matter must be current;
    (iii) Instructors, discussion leaders, and speakers must be 
qualified with respect to program content;
    (iv) Programs must include some means for evaluation of technical 
content and presentation;
    (v) Certificates of completion must be provided those who have 
successfully completed the program; and
    (vi) Records must be maintained by the sponsor to verify completion 
of the program and attendance by each participant. Such records must be 
retained for a period of three years following completion of the 
program. In the case of continuous conferences, conventions, and the 
like, records must be maintained to verify completion of the program and 
attendance by each participant at each segment of the program.
    (4) Professional organizations or societies wishing to be considered 
as qualified sponsors shall request such status of the Director of 
Practice and furnish information in support of the request

[[Page 191]]

together with any further information deemed necessary by the Director 
of Practice.
    (5) Sponsor agreements and qualified professional organization or 
society sponsors approved by the Director of Practice shall remain in 
effect for one enrollment cycle. The names of such sponsors will be 
published on a periodic basis.
    (h) Measurement of continuing education coursework. (1) All 
continuing education programs will be measured in terms of contact 
hours. The shortest recognized program will be one contact hour.
    (2) A contact hour is 50 minutes of continuous participation in a 
program. Credit is granted only for a full contact hour, i.e. 50 minutes 
or multiples thereof. For example, a program lasting more than 50 
minutes but less than 100 minutes will count as one contact hour.
    (3) Individual segments at continuous conferences, conventions and 
the like will be considered one total program. For example, two 90-
minute segments (180 minutes) at a continuous conference will count as 
three contact hours.
    (4) For university or college courses, each semester hour credit 
will equal 15 contact hours and a quarter hour credit will equal 10 
contact hours.
    (i) Recordkeeping requirements. (1) Each individual applying for 
renewal shall retain for a period of three years following the date of 
renewal of enrollment the information required with regard to qualifying 
continuing professional education credit hours. Such information shall 
include:
    (i) The name of the sponsoring organization;
    (ii) The location of the program;
    (iii) The title of the program and description of its content e.g., 
course syllibi and/or textbook;
    (iv) The dates attended;
    (v) The credit hours claimed;
    (vi) The name(s) of the instructor(s), discussion leader(s), or 
speaker(s), if appropriate; and
    (vii) The certificate of completion and/or signed statement of the 
hours of attendance obtained from the sponsor.
    (2) To receive continuing education credit for service completed as 
an instructor, discussion leader, or speaker, the following information 
must be maintained for a period of three years following the date of 
renewal of enrollment:
    (i) The name of the sponsoring organization;
    (ii) The location of the program;
    (iii) The title of the program and description of its content;
    (iv) The dates of the program; and
    (v) The credit hours claimed.
    (3) To receive continuing education credit for publications, the 
following information must be maintained for a period of three years 
following the date of renewal of enrollment:
    (i) The publisher;
    (ii) The title of the publication;
    (iii) A copy of the publication; and
    (iv) The date of publication.
    (j) Waivers. (1) Waiver from the continuing education requirements 
for a given period may be granted by the Director of Practice for the 
following reasons:
    (i) Health, which prevented compliance with the continuing education 
requirements;
    (ii) Extended active military duty;
    (iii) Absence from the United States for an extended period of time 
due to employment or other reasons, provided the individual does not 
practice before the Internal Revenue Service during such absence; and
    (iv) Other compelling reasons, which will be considered on a case-
by-case basis.
    (2) A request for waiver must be accompanied by appropriate 
documentation. The individual will be required to furnish any additional 
documentation or explanation deemed necessary by the Director of 
Practice. Examples of appropriate documentation could be a medical 
certificate, military orders, etc.
    (3) A request for waiver must be filed no later than the last day of 
the renewal application period.
    (4) If a request for waiver is not approved, the individual will be 
so notified by the Director of Practice and placed on a roster of 
inactive enrolled individuals.
    (5) If a request for waiver is approved, the individual will be so 
notified and issued a card evidencing such renewal.

[[Page 192]]

    (6) Those who are granted waivers are required to file timely 
applications for renewal of enrollment.
    (k) Failure to comply. (1) Compliance by an individual with the 
requirements of this part shall be determined by the Director of 
Practice. An individual who fails to meet the requirements of 
eligibility for renewal of enrollment will be notified by the Director 
of Practice at his/her last known address by first class mail. The 
notice will state the basis for the non-compliance and will provide the 
individual an opportunity to furnish in writing information relating to 
the matter within 60 days of the date of the notice. Such information 
will be considered by the Director of Practice in making a final 
determination as to eligibility for renewal of enrollment.
    (2) The Director of Practice may require any individual, by first 
class mail to his/her last known mailing address, to provide copies of 
any records required to be maintained under this part. The Director of 
Practice may disallow any continuing professional education hours 
claimed if the individual concerned fails to comply with such 
requirement.
    (3) An individual who has not filed a timely application for renewal 
of enrollment, who has not made a timely response to the notice of non-
compliance with the renewal requirements, or who has not satisfied the 
requirements of eligibility for renewal will be placed on a roster of 
inactive enrolled individuals for a period of three years. During this 
time, the individual will be ineligible to practice before the Internal 
Revenue Service.
    (4) During inactive enrollment status or at any other time an 
individual is ineligible to practice before the Internal Revenue 
Service, such individual shall not in any manner, directly or 
indirectly, indicate he or she is enrolled to practice before the 
Internal Revenue Service, or use the term ``enrolled agent,'' the 
designation ``E. A.,'' or other form of reference to eligibility to 
practice before the Internal Revenue Service.
    (5) An individual placed in an inactive status may satisfy the 
requirements for renewal of enrollment during his/her period of inactive 
enrollment. If such satisfaction includes completing the continuing 
education requirement, a minimum of 16 hours of qualifying continuing 
education hours must be completed in the 12 month period preceding the 
date on which the renewal application is filed. Continuing education 
credit under this subsection may not be used to satisfy the requirements 
of the enrollment cycle in which the individual has been placed back on 
the active roster.
    (6) An individual placed in an inactive status must file an 
application for renewal of enrollment and satisfy the requirements for 
renewal as set forth in this section within three years of being placed 
in an inactive status. The name of such individual otherwise will be 
removed from the inactive enrollment roster and his/her enrollment will 
terminate. Eligibility for enrollment must then be reestablished by the 
individual as provided in this part.
    (7) Inactive enrollment status is not available to an individual who 
is the subject of a discipline matter in the Office of Director of 
Practice.
    (l) Inactive retirement status. An individual who no longer 
practices before the Internal Revenue Service may request being placed 
in an inactive status at any time and such individual will be placed in 
an inactive retirement status. The individual will be ineligible to 
practice before the Internal Revenue Service. Such individual must file 
a timely application for renewal of enrollment at each applicable 
renewal or enrollment as provided in this part. An individual who is 
placed in an inactive retirement status may be reinstated to an active 
enrollment status upon filing an application for renewal of enrollment 
and providing evidence of the completion of the required continuing 
professional education hours for the enrollment cycle. Inactive 
retirement status is not available to an individual who is the subject 
to a discipline matter in the Office of Director of Practice.
    (m) Renewal while under suspension or disbarment. An individual who 
is ineligible to practice before the Internal Revenue Service by virtue 
of disciplinary action is required to meet the requirements for renewal 
of enrollment during the period of ineligibility.

[[Page 193]]

    (n) Verification. The Director of Practice may review the continuing 
education records of an enrolled individual and/or qualified sponsor in 
a manner deemed appropriate to determine compliance with the 
requirements and standards for renewal of enrollment as provided in this 
part.

(Approved by the Office of Management and Budget under control number 
1545-0946)

[51 FR 2878, Jan. 22, 1986]



Sec. 10.7  Representing oneself; participating in rulemaking; limited practice; special appearances; and return preparation.

    (a) Representing oneself. Individuals may appear on their own behalf 
before the Internal Revenue Service provided they present satisfactory 
identification.
    (b) Participating in rulemaking. Individuals may participate in 
rulemaking as provided by the Administrative Procedure Act. See 5 U.S.C. 
553.
    (c) Limited practice--(1) In general. Subject to the limitations in 
paragraph (c)(2) of this section, an individual who is not a 
practitioner may represent a taxpayer before the Internal Revenue 
Service in the circumstances described in this paragraph (c)(1), even if 
the taxpayer is not present, provided the individual presents 
satisfactory identification and proof of his or her authority to 
represent the taxpayer. The circumstances described in this paragraph 
(c)(1) are as follows:
    (i) An individual may represent a member of his or her immediate 
family.
    (ii) A regular full-time employee of an individual employer may 
represent the employer.
    (iii) A general partner or a regular full-time employee of a 
partnership may represent the partnership.
    (iv) A bona fide officer or a regular full-time employee of a 
corporation (including a parent, subsidiary, or other affiliated 
corporation), association, or organized group may represent the 
corporation, association, or organized group.
    (v) A trustee, receiver, guardian, personal representative, 
administrator, executor, or regular full-time employee of a trust, 
receivership, guardianship, or estate may represent the trust, 
receivership, guardianship, or estate.
    (vi) An officer or a regular employee of a governmental unit, 
agency, or authority may represent the governmental unit, agency, or 
authority in the course of his or her official duties.
    (vii) An individual may represent any individual or entity before 
personnel of the Internal Revenue Service who are outside of the United 
States.
    (viii) An individual who prepares and signs a taxpayer's return as 
the preparer, or who prepares a return but is not required (by the 
instructions to the return or regulations) to sign the return, may 
represent the taxpayer before officers and employees of the Examination 
Division of the Internal Revenue Service with respect to the tax 
liability of the taxpayer for the taxable year or period covered by that 
return.
    (2) Limitations. (i) An individual who is under suspension or 
disbarment from practice before the Internal Revenue Service may not 
engage in limited practice before the Service under Sec. 10.7(c)(1).
    (ii) The Director, after notice and opportunity for a conference, 
may deny eligibility to engage in limited practice before the Internal 
Revenue Service under Sec. 10.7(c)(1) to any individual who has engaged 
in conduct that would justify suspending or disbarring a practitioner 
from practice before the Service.
    (iii) An individual who represents a taxpayer under the authority of 
Sec. 10.7(c)(1)(viii) is subject to such rules of general applicability 
regarding standards of conduct, the extent of his or her authority, and 
other matters as the Director prescribes.
    (d) Special appearances. The Director, subject to such conditions as 
he or she deems appropriate, may authorize an individual who is not 
otherwise eligible to practice before the Service to represent another 
person in a particular matter.
    (e) Preparing tax returns and furnishing information. An individual 
may prepare a tax return, appear as a witness for the taxpayer before 
the Internal Revenue Service, or furnish information at the request of 
the Service or any of its officers or employees.

[59 FR 31526, June 20, 1994]

[[Page 194]]



Sec. 10.8  Customhouse brokers.

    Nothing contained in the regulations in this part shall be deemed to 
affect or limit the right of a customhouse broker, licensed as such by 
the Commissioner of Customs in accordance with the regulations 
prescribed therefor, in any customs district in which he is so licensed, 
at the office of the District Director of Internal Revenue or before the 
National Office of the Internal Revenue Service, to act as a 
representative in respect to any matters relating specifically to the 
importation or exportation of merchandise under the customs or internal 
revenue laws, for any person for whom he has acted as a customhouse 
broker.



   Subpart B--Duties and Restrictions Relating to Practice Before the 
                        Internal Revenue Service



Sec. 10.20  Information to be furnished.

    (a) To the Internal Revenue Service. No attorney, certified public 
accountant, enrolled agent, or enrolled actuary shall neglect or refuse 
promptly to submit records or information in any matter before the 
Internal Revenue Service, upon proper and lawful request by a duly 
authorized officer or employee of the Internal Revenue Service, or shall 
interfere, or attempt to interfere, with any proper and lawful effort by 
the Internal Revenue Service or its officers or employees to obtain any 
such record or information, unless he believes in good faith and on 
reasonable grounds that such record or information is privileged or that 
the request for, or effort to obtain, such record or information is of 
doubtful legality.
    (b) To the Director of Practice. It shall be the duty of an attorney 
or certified public accountant, who practices before the Internal 
Revenue Service, or enrolled agent, when requested by the Director of 
Practice, to provide the Director with any information he may have 
concerning violation of the regulations in this part by any person, and 
to testify thereto in any proceeding instituted under this part for the 
disbarment or suspension of an attorney, certified public accountant, 
enrolled agent, or enrolled actuary, unless he believes in good faith 
and on reasonable grounds that such information is privileged or that 
the request therefor is of doubtful legality.

[31 FR 10773, Aug. 13, 1966, as amended at 57 FR 41095, Sept. 9, 1992]



Sec. 10.21  Knowledge of client's omission.

    Each attorney, certified public accountant, enrolled agent, or 
enrolled actuary who, having been retained by a client with respect to a 
matter administered by the Internal Revenue Service, knows that the 
client has not complied with the revenue laws of the United States or 
has made an error in or omission from any return, document, affidavit, 
or other paper which the client is required by the revenue laws of the 
United States to execute, shall advise the client promptly of the fact 
of such noncompliance, error, or omission.

[42 FR 38352, July 28, 1977, as amended at 57 FR 41095, Sept. 9, 1992]



Sec. 10.22  Diligence as to accuracy.

    Each attorney, certified public accountant, enrolled agent, or 
enrolled actuary shall exercise due diligence:
    (a) In preparing or assisting in the preparation of, approving, and 
filing returns, documents, affidavits, and other papers relating to 
Internal Revenue Service matters;
    (b) In determining the correctness of oral or written 
representations made by him to the Department of the Treasury; and
    (c) In determining the correctness of oral or written 
representations made by him to clients with reference to any matter 
administered by the Internal Revenue Service.

[35 FR 13205, Aug. 19, 1970, as amended at 42 FR 38352, July 28, 1977; 
57 FR 41095, Sept. 9, 1992]



Sec. 10.23  Prompt disposition of pending matters.

    No attorney, certified public accountant, enrolled agent, or 
enrolled actuary shall unreasonably delay the prompt disposition of any 
matter before the Internal Revenue Service.

[[Page 195]]



Sec. 10.24  Assistance from disbarred or suspended persons and former Internal Revenue Service employees.

    No attorney, certified public accountant, enrolled agent, or 
enrolled actuary shall, in practice before the Internal Revenue Service, 
knowingly and directly or indirectly:
    (a) Employ or accept assistance from any person who is under 
disbarment or suspension from practice before the Internal Revenue 
Service.
    (b) Accept employment as associate, correspondent, or subagent from, 
or share fees with, any such person.
    (c) Accept assistance from any former government employee where the 
provisions of Sec. 10.26 of these regulations or any Federal law would 
be violated.

[44 FR 4943, Jan. 24, 1979, as amended at 57 FR 41095, Sept. 9, 1992]



Sec. 10.25  Practice by partners of Government employees.

    No partner of an officer or employee of the executive branch of the 
U.S. Government, of any independent agency of the United States, or of 
the District of Columbia, shall represent anyone in any matter 
administered by the Internal Revenue Service in which such officer or 
employee of the Government participates or has participated personally 
and substantially as a Government employee or which is the subject of 
his official responsibility.

[31 FR 10773, Aug. 13, 1966, as amended at 35 FR 13205, Aug. 19, 1970]



Sec. 10.26  Practice by former Government employees, their partners and their associates.

    (a) Definitions. For purposes of Sec. 10.26. (1) Assist means to act 
in such a way as to advise, furnish information to or otherwise aid 
another person, directly of indirectly.
    (2) Government employee is an officer or employee of the United 
States or any agency of the United States, including a special 
government employee as defined in 18 U.S.C. 202(a), or of the District 
of Columbia, or of any State, or a member of Congress or of any State 
legislature.
    (3) Member of a firm is a sole practioner or an employee or 
associate thereof, or a partner, stockholder, associate, affiliate or 
employee of a partnership, joint venture, corporation, professional 
association or other affiliation of two or more practitioners who 
represent non-Government parties.
    (4) Practitioner includes any individual described in Sec. 10.3(e).
    (5) Official responsibility means the direct administrative or 
operating authority, whether intermediate or final, and either 
exercisable alone or with others, and either personally or through 
subordinates, to approve, disapprove, or otherwise direct Government 
action, with or without knowledge of the action.
    (6) Participate or participation means substantial involvement as a 
Government employee by making decisions, or preparing or reviewing 
documents with or without the right to exercise a judgment of approval 
or disapproval, or participating in conferences or investigations, or 
rendering advice of a substantial nature.
    (7) Rule includes Treasury Regulations, whether issued or under 
preparation for issuance as Notices of Proposed Rule Making or as 
Treasury Decisions, and revenue rulings and revenue procedures published 
in the Internal Revenue bulletin. Rule shall not include a transaction 
as defined in paragraph (a)(9) of this section.
    (8) Transaction means any decision, determination, finding, letter 
ruling, technical advice, contract or approval or disapproval thereof, 
relating to a particular factual situation or situations involving a 
specific party or parties whose rights, privileges, or liabilities under 
laws or regulations administered by the Internal Revenue Service, or 
other legal rights, are determined or immediately affected therein and 
to which the United States is a party or in which it has a direct and 
substantial interest, whether or not the same taxable periods are 
involved. Transaction does not include rule as defined in paragraph 
(a)(7) of this section.
    (b) General rules. (1) No former Government employee shall, 
subsequent to his Government employment, represent anyone in any matter 
administered by the Internal Revenue Service if the representation would 
violate 18 U.S.C.

[[Page 196]]

207 (a) or (b) of any other laws of the United States.
    (2) No former Government employee who participated in a transaction 
shall, subsequent to his Government employment, represent or knowingly 
assist, in that transaction, any person who is or was a specific party 
to that transaction.
    (3) No former Government employee who within a period of one year 
prior to the termination of his Government employment had official 
responsibility for a transaction shall, within one year after his 
Government employment is ended, represent or knowingly assist in that 
transaction any person who is or was a specific party to that 
transaction.
    (4) No former Government employee shall, within one year after his 
Government employment is ended, appear before any employee of the 
Treasury Department in connection with the publication, withdrawal, 
amendment, modification, or interpretation of a rule in the development 
of which the former Government employee participated or for which, 
within a period of one year prior to the termination of his Government 
employment, he had official responsibility. However, this subparagraph 
does not preclude such former employee for appearing on his own behalf 
or from representing a taxpayer before the Internal Revenue Service in 
connection with a transaction involving the application or 
interpretation of such a rule with respect to that transaction: 
Provided, That such former employee shall not utilize or disclose any 
confidential information acquired by the former employee in the 
development of the rule, and shall not contend that the rule is invalid 
or illegal. In addition, this subparagraph does not preclude such former 
employee from otherwise advising or acting for any person.
    (c) Firm representation. (1) No member of a firm of which a former 
Government employee is a member may represent or knowingly assist a 
person who was or is a specific party in any transaction with respect to 
which the restrictions of paragraph (b)(1) (other than 18 U.S.C. 207 
(b)) or (b)(2) of this section apply to the former Government employee, 
in that transaction, unless:
    (i) No member of the firm who had knowledge of the participation by 
the Government employee in the transaction initiated discussions with 
the Government employee concerning his becoming a member of the firm 
until his Government employment is ended or six months after the 
termination of his participation in the transaction, whichever is 
earlier;
    (ii) The former Government employee did not initiate any discussions 
concerning becoming a member of the firm while participating in the 
transaction or, if such discussions were intitiated, they conformed with 
the requirements of 18 U.S.C. 208(b); and
    (iii) The firm isolates the former Government employee in such a way 
that he does not assist in the representation.
    (2) No member of a firm of which a former Government employee is a 
member may represent or knowingly assist a person who was or is a 
specific party in any transaction with respect to which the restrictions 
of paragraph (b)(3) of this section apply to the former employee, in 
that transaction unless the firm isolates the former Government employee 
in such a way that he does not assist in the representation.
    (3) When isolation of the former Government employee is required 
under paragraph (c)(1) or (c)(2) of this section, a statement affirming 
the fact of such isolation shall be executed under oath by the former 
Government employee and by a member of the firm acting on behalf of the 
firm, and shall be filed with the Director of Practice and in such other 
place and in the manner prescribed by regulation. This statement shall 
clearly identify the firm, the former Government employee, and the 
transaction or transactions requiring such isolation.
    (d) Pending representation. Practice by former Government employees, 
their partners and associates with respect to representation in specific 
matters where actual representation commenced before publication of this 
regulation is governed by the regulations set forth in the June 1972 
amendments

[[Page 197]]

to the regulations of this part (published at 37 FR 11676): Provided, 
That the burden of showing that representation commenced before 
publication is with the former Government employees, their partners and 
associates.

[42 FR 38352, July 28, 1977, as amended at 57 FR 41095, Sept. 9, 1992; 
59 FR 31527, June 20, 1994]



Sec. 10.27  Notaries.

    No attorney, certified public accountant, enrolled agent, or 
enrolled actuary as notary public shall with respect to any matter 
administered by the Internal Revenue Service take acknowledgments, 
administer oaths, certify papers, or perform any official act in 
connection with matters in which he is employed as counsel, attorney, or 
agent, or in which he may be in any way interested before the Internal 
Revenue Service (26 Op. Atty. Gen. 236).

[31 FR 10773, Aug. 13, 1966, as amended at 57 FR 41095, Sept. 9, 1992]



Sec. 10.28  Fees.

    (a) Generally. A practitioner may not charge an unconscionable fee 
for representing a client in a matter before the Internal Revenue 
Service.
    (b) Contingent fees for return preparation. A practitioner may not 
charge a contingent fee for preparing an original return. A practitioner 
may charge a contingent fee for preparing an amended return or a claim 
for refund (other than a claim for refund made on an original return) if 
the practitioner reasonably anticipates at the time the fee arrangement 
is entered into that the amended return or claim will receive 
substantive review by the Service. A contingent fee includes a fee that 
is based on a percentage of the refund shown on a return or a percentage 
of the taxes saved, or that otherwise depends on the specific result 
attained.

[59 FR 31527, June 20, 1994]



Sec. 10.29  Conflicting interests.

    No attorney, certified public accountant, enrolled agent, or 
enrolled actuary shall represent conflicting interests in his practice 
before the Internal Revenue Service, except by express consent of all 
directly interested parties after full disclosure has been made.

[31 FR 10773, Aug. 13, 1966, as amended at 57 FR 41095, Sept. 9, 1992]



Sec. 10.30  Solicitation.

    (a) Advertising and solicitation restrictions. (1) No attorney, 
certified public accountant, enrolled agent, enrolled actuary, or other 
individual eligible to practice before the Internal Revenue Service 
shall, with respect to any Internal Revenue Service matter, in any way 
use or participate in the use of any form of public communication 
containing (i) A false, fraudulent, unduly influencing, coercive, or 
unfair statement or claim; or (ii) a misleading or deceptive statement 
or claim. Enrolled agents, in describing their professional designation, 
may not utilize the term of art ``certified'' or indicate an employer/
employee relationship with the Internal Revenue Service. Examples of 
acceptable descriptions are ``enrolled to represent taxpayers before the 
Internal Revenue Service,'' ``enrolled to practice before the Internal 
Revenue Service, and ``admitted to practice before the Internal Revenue 
Service.'' Enrolled agents and enrolled actuaries may abbreviate such 
designation to either EA or E.A.
    (2) No attorney, certified public accountant, enrolled agent, 
enrolled actuary, or other individual eligible to practice before the 
Internal Revenue Service shall make, directly or indirectly, an 
uninvited solicitation of employment in matters related to the Internal 
Revenue Service. Solicitation includes, but is not limited to, in-person 
contacts and telephone communications. This restriction does not apply 
to (i) Seeking new business from an existing or former client in a 
related matter; (ii) communications with family members; (iii) making 
the availability of professional services known to other practitioners, 
so long as the person or firm contacted is not a potential client; (iv) 
solicitation by mailings; or (v) non-coercive in-person solicitation by 
those eligible to practice before the Internal Revenue Service while 
acting as an employee, member, or officer of an exempt organization 
listed in sections 501(c)(3) or (4) of the

[[Page 198]]

Internal Revenue Code of 1954 (26 U.S.C.).

Any targeted direct mail solicitation, i.e. a mailing to those whose 
unique circumstances are the basis for the solicitation, distributed by 
or on behalf of an attorney, certified public accountant, enrolled 
agency, enrolled actuary, or other individual eligible to practice 
before the Internal Revenue Service shall be clearly marked as such in 
capital letters on the envelope and at the top of the first page of such 
mailing. In addition, all such solicitations must clearly identify the 
source of the information used in choosing the recipient.
    (b) Fee information. (1) Attorney, certified public accountant, 
enrolled agent, or enrolled actuary and other individuals eligible to 
practice before the Internal Revenue Service may disseminate the 
following fee information:
    (i) Fixed fees for specific routine services.
    (ii) Hourly rates.
    (iii) Range of fees for particular services.
    (iv) Fee charged for an initial consultation.

Any statement of fee information concerning matters in which costs may 
be incurred shall include a statement disclosing whether clients will be 
responsible for such costs.
    (2) Attorney, certified public accountant, enrolled agent, or 
enrolled actuary and other individuals eligible to practice before the 
Internal Revenue Service may also publish the availability of a written 
schedule of fees.
    (3) Attorney, certified public accountant, enrolled agent, or 
enrolled actuary and other individuals eligible to practice before the 
Internal Revenue Service shall be bound to charge the hourly rate, the 
fixed fee for specific routine services, the range of fees for 
particular services, or the fee for an initial consultation published 
for a reasonable period of time, but no less than thirty days from the 
last publication of such hourly rate or fees.
    (c) Communications. Communication, including fee information, may 
include professional lists, telephone directories, print media, 
mailings, radio and television, and any other method: Provided, that the 
method chosen does not cause the communication to become untruthful, 
deceptive, unduly influencing or otherwise in violation of these 
regulations. It shall be construed as a violation of these regulations 
for a practitioner to persist in attempting to contact a prospective 
client, if such client has made known to the practitioner a desire not 
to be solicited. In the case of radio and television broadcasting, the 
broadcast shall be pre-recorded and the practitioner shall retain a 
recording of the actual audio transmission. In the case of direct mail 
communications, the practitioner shall retain a copy of the actual 
mailing, along with a list or other description of persons to whom the 
communication was mailed or otherwise distributed. Such copy shall be 
retained by the practitioner for a period of at least 36 months from the 
date of the last transmission or use.
    (d) Improper associations. An attorney, certified public accountant, 
enrolled agent, or enrolled actuary may in matters related to the 
Internal Revenue Service, employ or accept employment or assistance as 
an associate, correspondent, or subagent from, or share fees with, any 
person or entity who, to the knowledge of the practitioner, obtains 
clients or otherwise practices in a manner forbidden under this section: 
Provided, That a practitioner does not, directly or indirectly, act or 
hold himself out as an Internal Revenue Service practitioner in 
connection with that relationship. Nothing herein shall prohibit an 
attorney, certified public accountant, or enrolled agent from practice 
before the Internal Revenue Service in a capacity other than that 
described above.

[44 FR 4943, Jan. 24, 1979, as amended at 57 FR 41095, Sept. 9, 1992]



Sec. 10.31  Negotiation of taxpayer refund checks.

    No attorney, certified public accountant, enrolled agent, or 
enrolled actuary who is an income tax return preparer shall endorse or 
otherwise negotiate any check made in respect of

[[Page 199]]

income taxes which is issued to a taxpayer other than the attorney, 
certified public accountant or enrolled agent.

[42 FR 38353, July 28, 1977, as amended at 57 FR 41095, Sept. 9, 1992]



Sec. 10.32  Practice of law.

    Nothing in the regulations in this part shall be construed as 
authorizing persons not members of the bar to practice law.

[31 FR 10773, Aug. 13, 1966. Redesignated at 42 FR 38353, July 28, 1977]



Sec. 10.33  Tax shelter opinions.

    (a) Tax shelter opinions and offering materials. A practitioner who 
provides a tax shelter opinion analyzing the Federal tax effects of a 
tax shelter investment shall comply with each of the following 
requirements:
    (1) Factual matters. (i) The practitioner must make inquiry as to 
all relevant facts, be satisfied that the material facts are accurately 
and completely described in the offering materials, and assure that any 
representations as to future activities are clearly identified, 
reasonable and complete.
    (ii) A practitioner may not accept as true asserted facts pertaining 
to the tax shelter which he/she should not, based on his/her background 
and knowledge, reasonably believe to be true. However, a practitioner 
need not conduct an audit or independent verification of the asserted 
facts, or assume that a client's statement of the facts cannot be relied 
upon, unless he/she has reason to believe that any relevant facts 
asserted to him/her are untrue.
    (iii) If the fair market value of property or the expected financial 
performance of an investment is relevant to the tax shelter, a 
practitioner may not accept an appraisal or financial projection as 
support for the matters claimed therein unless:
    (A) The appraisal or financial projection makes sense on its face;
    (B) The practitioner reasonably believes that the person making the 
appraisal or financial projection is competent to do so and is not of 
dubious reputation; and
    (C) The appraisal is based on the definition of fair market value 
prescribed under the relevant Federal tax provisions.
    (iv) If the fair market value of purchased property is to be 
established by reference to its stated purchase price, the practitioner 
must examine the terms and conditions upon which the property was (or is 
to be) purchased to determine whether the stated purchase price 
reasonably may be considered to be its fair market value.
    (2) Relate law to facts. The practitioner must relate the law to the 
actual facts and, when addressing issues based on future activities, 
clearly identify what facts are assumed.
    (3) Identification of material issues. The practitioner must 
ascertain that all material Federal tax issues have been considered, and 
that all of those issues which involve the reasonable possibility of a 
challenge by the Internal Revenue Service have been fully and fairly 
addressed in the offering materials.
    (4) Opinion on each material issue. Where possible, the practitioner 
must provide an opinion whether it is more likely than not that an 
investor will prevail on the merits of each material tax issue presented 
by the offering which involves a reasonable possibility of a challenge 
by the Internal Revenue Service. Where such an opinion cannot be given 
with respect to any material tax issue, the opinion should fully 
describe the reasons for the practitioner's inability to opine as to the 
likely outcome.
    (5) Overall evaluation. (i) Where possible, the practitioner must 
provide an overall evaluation whether the material tax benefits in the 
aggregate more likely than not will be realized. Where such an overall 
evaluation cannot be given, the opinion should fully describe the 
reasons for the practitioner's inability to make an overall evaluation. 
Opinions concluding that an overall evaluation cannot be provided will 
be given special scrutiny to determine if the stated reasons are 
adequate.
    (ii) A favorable overall evaluation may not be rendered unless it is 
based on a conclusion that substantially more than half of the material 
tax benefits, in terms of their financial impact

[[Page 200]]

on a typical investor, more likely than not will be realized if 
challenged by the Internal Revenue Service.
    (iii) If it is not possible to give an overall evaluation, or if the 
overall evaluation is that the material tax benefits in the aggregate 
will not be realized, the fact that the practitioner's opinion does not 
constitute a favorable overall evaluation, or that it is an unfavorable 
overall evaluation, must be clearly and prominently disclosed in the 
offering materials.
    (iv) The following examples illustrate the principles of this 
paragraph:

    Example (1). A limited partnership acquires real property in a sale-
leaseback transaction. The principal tax benefits offered to investing 
partners consist of depreciation and interest deductions. Lesser tax 
benefits are offered to investors by reason of several deductions under 
Internal Revenue Code section 162 (ordinary and necessary business 
expenses). If a practitioner concludes that it is more likely than not 
that the partnership will not be treated as the owner of the property 
for tax purposes (which is required to allow the interest and 
depreciation deductions), then he/she may not opine to the effect that 
it is more likely than not that the material tax benefits in the 
aggregate will be realized, regardless of whether favorable opinions may 
be given with respect to the deductions claimed under Code section 162.
    Example (2). A corporation electing under subchapter S of the 
Internal Revenue Code is formed to engage in research and development 
activities. The offering materials forecast that deductions for research 
and experimental expenditures equal to 75% of the total investment in 
the corporation will be available during the first two years of the 
corporation's operations, other expenses will account for another 15% of 
the total investment, and that little or no gross income will be 
received by the corporation during this period. The practitioner 
concludes that it is more likely than not that deductions for research 
and experimental expenditures will be allowable. The practitioner may 
render an opinion to the effect that based on this conclusion, it is 
more likely than not that the material tax benefits in the aggregate 
will be realized, regardless of whether he/she can opine that it is more 
likely than not that any of the other tax benefits will be achieved.
    Example (3). An investment program is established to acquire 
offsetting positions in commodities contracts. The objective of the 
program is to close the loss positions in year one and to close the 
profit positions in year two. The principal tax benefit offered by the 
program is a loss in the first year, coupled with the deferral of 
offsetting gain until the following year. The practitioner concludes 
that the losses will not be deductible in year one. Accordingly, he/she 
may not render an opinion to the effect that it is more likely than not 
that the material tax benefits in the aggregate will be realized, 
regardless of the fact that he/she is of the opinion that losses not 
allowable in year one will be allowable in year two, because the 
principal tax benefit offered is a one-year deferral of income.
    Example (4). A limited partnership is formed to acquire, own and 
operate residential rental real estate. The offering material forecasts 
gross income of $2,000,000 and total deductions of $10,000,000, 
resulting in net losses of $8,000,000 over the first six taxable years. 
Of the total deductions, depreciation and interest are projected to be 
$7,000,000, and other deductions $3,000,000. The practitioner concludes 
that it is more likely than not that all of the depreciation and 
interest deductions will be allowable, and that it is more likely than 
not that the other deductions will not be allowed. The practitioner may 
render an opinion to the efect that it is more likely than not that the 
material tax benefits in the aggregate will be realized.

    (6) Description of opinion. The practitioner must assure that the 
offering materials correctly and fairly represent the nature and extent 
of the tax shelter opinion.
    (b) Reliance on other opinions--(1) In general. A practitioner may 
provide an opinion on less than all of the material tax issues only if:
    (i) At least one other competent practitioner provides an opinion on 
the likely outcome with respect to all of the other material tax issues 
which involve a reasonable possibility of challenge by the Internal 
Revenue Service, and an overall evalution whether the material tax 
benefits in the aggregate more likely than not will be realized, which 
is disseminated in the same manner as the practitioner's opinion; and
    (ii) The practitioner, upon reviewing such other opinions and any 
offering materials, has no reason to believe that the standards of 
paragraph (a) of this section have not been complied with.

Notwithstanding the foregoing, a practitioner who has not been retained 
to provide an overall evaluation whether the material tax benefits in 
the aggregate more likely than not will be realized may issue an opinion 
on less than

[[Page 201]]

all the material tax issues only if he/she has no reason to believe, 
based on his/her knowledge and experience, that the overall evaluation 
given by the practitioner who furnishes the overall evaluation is 
incorrect on its face.
    (2) Forecasts and projections. A practitioner who is associated with 
forecasts or projections relating to or based upon the tax consequences 
of the tax shelter offering that are included in the offering materials, 
or are disseminated to potential investors other than the practitioner's 
clients, may rely on the opinion of another practitioner as to any or 
all material tax issues, provided that the practitioner who desires to 
rely on the other opinion has no reason to believe that the standards of 
paragraph (a) of this section have not been complied with by the 
practitioner rendering such other opinion, and the requirements of 
paragraph (b)(1) of this section are satisfied. The practitioner's 
report shall disclose any material tax issue not covered by, or 
incorrectly opined upon, by the other opinion, and shall set forth his/
her opinion with respect to each such issue in a manner that satisfies 
the requirements of paragraph (a) of this section.
    (c) Definitions. For purposes of this section:
    (1) Practitioner includes any individual described in Sec. 10.3(e).
    (2) A tax shelter, as the term is used in this section, is an 
investment which has as a significant and intended feature for Federal 
income or excise tax purposes either of the following attributes:
    (i) Deductions in excess of income from the investment being 
available in any year to reduce income from other sources in that year, 
or
    (ii) Credits in excess of the tax attributable to the income from 
the investment being available in any year to offset taxes on income 
from other sources in that year. Excluded from the term are municipal 
bonds; annuities; family trusts (but not including schemes or 
arrangements that are marketed to the public other than in a direct 
practitioner-client relationship); qualified retirement plans; 
individual retirement accounts; stock option plans; securities issued in 
a corporate reorganization; mineral development ventures, if the only 
tax benefit would be percentage depletion; and real estate where it is 
anticipated that in no year is it likely that deductions will exceed 
gross income from the investment in that year, or that tax credits will 
exceed the tax attributable to gross income from the investment in that 
year. Whether an investment is intended to have tax shelter features 
depends on the objective facts and circumstances of each case. 
Significant weight will be given to the features described in the 
offering materials to determine whether the investment is a tax shelter.
    (3) A tax shelter opinion, as the term is used in this section, is 
advice by a practitioner concerning the Federal tax aspects of a tax 
shelter either appearing or referred to in the offering materials, or 
used or referred to in connection with sales promotion efforts, and 
directed to persons other than the client who engaged the practitioner 
to give the advice. The term includes the tax aspects or tax risks 
portion of the offering materials prepared by or at the direction of a 
practitioner, whether or not a separate opinion letter is issued or 
whether or not the practitioner's name is referred to in the offering 
materials or in connection with the sales promotion efforts. In 
addition, a financial forcast or projection prepared by a practitioner 
is a tax shelter opinion if it is predicated on assumptions regarding 
Federal tax aspects of the investment, and it meets the other 
requirements of the first sentence of this paragraph. The term does not, 
however, include rendering advice solely to the offeror or reviewing 
parts of the offering materials, so long as neither the name of the 
practitioner, nor the fact that a practitioner has rendered advice 
concerning the tax aspects, is referred to in the offering materials or 
in connection with the sales promotion efforts.
    (4) A material tax issue as the term is used in this section is
    (i) Any Federal income or excise tax issue relating to a tax shelter 
that would make a significant contribution toward sheltering from 
Federal taxes income from other sources by providing deductions in 
excess of the income from the tax shelter investment

[[Page 202]]

in any year, or tax credits available to offset tax liabilities in 
excess of the tax attributable to the tax shelter investment in any 
year;
    (ii) Any other Federal income or excise tax issue relating to a tax 
shelter that could have a significant impact (either benefical or 
adverse) on a tax shelter investor under any reasonably foreseeable 
circumstances (e.g., depreciation or investment tax credit recapture, 
availability of long-term capital gain treatment, or realization of 
taxable income in excess of cash flow, upon sale or other disposition of 
the tax shelter investment); and
    (iii) The potential applicability of penalties, additions to tax, or 
interest charges that reasonably could be asserted against a tax shelter 
investor by the Internal Revenue Service with respect to the tax 
shelter. The determination of what is material is to be made in good 
faith by the practitioner, based on information available at the time 
the offering materials are circulated.
    (d) For purposes of advising the Director of Practice whether an 
individual may have violated Sec. 10.33, the Director of Practice is 
authorized to establish an Advisory Committee, composed of at least five 
individuals authorized to practice before the Internal Revenue Service. 
Under procedures established by the Director of Practice, such Advisory 
Committee shall, at the request of the Director of Practice, review and 
make recommendations with regard to alleged violations of Sec. 10.33.

(Sec. 3, 23 Stat. 258, secs. 2-12, 60 Stat. 237 et seq.; 5 U.S.C. 301; 
31 U.S.C. 330; 31 U.S.C. 321 (Reorg. Plan No. 26 of 1950, 15 FR 4935, 64 
Stat. 1280, 3 CFR, 1949-53 Comp., p. 1017))

[49 FR 6722, Feb. 23, 1984; 49 FR 7116, Feb. 27, 1984; 59 FR 31527, 
31528, June 20, 1994]



Sec. 10.34  Standards for advising with respect to tax return positions and for preparing or signing returns.

    (a) Standards of conduct--(1) Realistic possibility standard. A 
practitioner may not sign a return as a preparer if the practitioner 
determines that the return contains a position that does not have a 
realistic possibility of being sustained on its merits (the realistic 
possibility standard) unless the position is not frivolous and is 
adequately disclosed to the Service. A practitioner may not advise a 
client to take a position on a return, or prepare the portion of a 
return on which a position is taken, unless--
    (i) The practitioner determines that the position satisfies the 
realistic possibility standard; or
    (ii) The position is not frivolous and the practitioner advises the 
client of any opportunity to avoid the accuracy-related penalty in 
section 6662 of the Internal Revenue Code of 1986 by adequately 
disclosing the position and of the requirements for adequate disclosure.
    (2) Advising clients on potential penalties. A practitioner advising 
a client to take a position on a return, or preparing or signing a 
return as a preparer, must inform the client of the penalties reasonably 
likely to apply to the client with respect to the position advised, 
prepared, or reported. The practitioner also must inform the client of 
any opportunity to avoid any such penalty by disclosure, if relevant, 
and of the requirements for adequate disclosure. This paragraph (a)(2) 
applies even if the practitioner is not subject to a penalty with 
respect to the position.
    (3) Relying on information furnished by clients. A practitioner 
advising a client to take a position on a return, or preparing or 
signing a return as a preparer, generally may rely in good faith without 
verification upon information furnished by the client. However, the 
practitioner may not ignore the implications of information furnished 
to, or actually known by, the practitioner, and must make reasonable 
inquiries if the information as furnished appears to be incorrect, 
inconsistent, or incomplete.
    (4) Definitions. For purposes of this section:
    (i) Realistic possibility. A position is considered to have a 
realistic possibility of being sustained on its merits if a reasonable 
and well-informed analysis by a person knowledgeable in the tax law 
would lead such a person to conclude that the position has approximately 
a one in three, or greater, likelihood of being sustained on its merits. 
The authorities described in 26 CFR

[[Page 203]]

1.6662-4(d)(3)(iii), or any successor provision, of the substantial 
understatement penalty regulations may be taken into account for 
purposes of this analysis. The possibility that a position will not be 
challenged by the Service (e.g., because the taxpayer's return may not 
be audited or because the issue may not be raised on audit) may not be 
taken into account.
    (ii) Frivolous. A position is frivolous if it is patently improper.
    (b) Standard of discipline. As provided in Sec. 10.52, only 
violations of this section that are willful, reckless, or a result of 
gross incompetence will subject a practitioner to suspension or 
disbarment from practice before the Service.

[59 FR 31527, June 20, 1994]



         Subpart C--Rules Applicable to Disciplinary Proceedings



Sec. 10.50  Authority to disbar or suspend.

    Pursuant to 31 U.S.C. 330(b), the Secretary of the Treasury after 
notice and an opportunity for a proceeding, may suspend or disbar any 
practitioner from practice before the Internal Revenue Service. The 
Secretary may take such action against any practitioner who is shown to 
be incompetent or disreputable, who refuses to comply with any 
regulation in this part, or who, with intent to defraud, willfully and 
knowingly misleads or threatens a client or prospective client.

[59 FR 31528, June 20, 1994]



Sec. 10.51  Disreputable conduct.

    Disreputable conduct for which an attorney, certified public 
accountant, enrolled agent, or enrolled actuary may be disbarred or 
suspended from practice before the Internal Revenue Service includes, 
but is not limited to:
    (a) Conviction of any criminal offense under the revenue laws of the 
United States, or of any offense involving dishonesty, or breach of 
trust.
    (b) Giving false or misleading information, or participating in any 
way in the giving of false or misleading information to the Department 
of the Treasury or any officer or employee thereof, or to any tribunal 
authorized to pass upon Federal tax matters, in connection with any 
matter pending or likely to be pending before them, knowing such 
information to be false or misleading. Facts or other matters contained 
in testimony, Federal tax returns, financial statements, applications 
for enrollment, affidavits, declarations, or any other document or 
statement, written or oral, are included in the term ``information.''
    (c) Solicitation of employment as prohibited under Sec. 10.30, the 
use of false or misleading representations with intent to deceive a 
client or prospective client in order to procure employment, or 
intimating that the practitioner is able improperly to obtain special 
consideration or action from the Internal Revenue Service or officer or 
employee thereof.
    (d) Willfully failing to make Federal tax return in violation of the 
revenue laws of the United States, or evading, attempting to evade, or 
participating in any way in evading or attempting to evade any Federal 
tax or payment thereof, knowingly counseling or suggesting to a client 
or prospective client an illegal plan to evade Federal taxes or payment 
thereof, or concealing assets of himself or another to evade Federal 
taxes or payment thereof.
    (e) Misappropriation of, or failure properly and promptly to remit 
funds received from a client for the purpose of payment of taxes or 
other obligations due the United States.
    (f) Directly or indirectly attempting to influence, or offering or 
agreeing to attempt to influence, the official action of any officer or 
employee of the Internal Revenue Service by the use of threats, false 
accusations, duress or coercion, by the offer of any special inducement 
or promise of advantage or by the bestowing of any gift, favor or thing 
of value.
    (g) Disbarment or suspension from practice as an attorney, certified 
public accountant, public accountant, or actuary by any duly constituted 
authority of any State, possession, territory, Commonwealth, the 
District of Columbia, any Federal court of record or any Federal agency, 
body or board.
    (h) Knowingly aiding and abetting another person to practice before 
the

[[Page 204]]

Internal Revenue Service during a period of suspension, disbarment, or 
ineligibility of such other person. Maintaining a partnership for the 
practice of law, accountancy, or other related professional service with 
a person who is under disbarment from practice before the Service shall 
be presumed to be a violation of this provision.
    (i) Contemptuous conduct in connection with practice before the 
Internal Revenue Service, including the use of abusive language, making 
false accusations and statements knowing them to be false, or 
circulating or publishing malicious or libelous matter.
    (j) Giving a false opinion, knowingly, recklessly, or through gross 
incompetence, including an opinion which is intentionally or recklessly 
misleading, or a pattern of providing incompetent opinions on questions 
arising under the Federal tax laws. False opinions described in this 
paragraph include those which reflect or result from a knowing 
misstatement of fact or law; from an assertion of a position known to be 
unwarranted under existing law; from counseling or assisting in conduct 
known to be illegal or fraudulent; from concealment of matters required 
by law to be revealed; or from conscious disregard of information 
indicating that material facts expressed in the tax opinion or offering 
material are false or misleading. For purposes of this paragraph, 
reckless conduct is a highly unreasonable omission or misrepresentation 
involving an extreme departure from the standards of ordinary care that 
a practitioner should observe under the circumstances. A pattern of 
conduct is a factor that will be taken into account in determining 
whether a practitioner acted knowingly, recklessly, or through gross 
incompetence. Gross incompetence includes conduct that reflects gross 
indifference, preparation which is grossly inadequate under the 
circumstances, and a consistent failure to perform obligations to the 
client.

(Sec. 3, 23 Stat. 258, secs. 2-12, 60 Stat. 237 et seq.; 5 U.S.C. 301; 
31 U.S.C. 330; 31 U.S.C. 321 (Reorg. Plan No. 26 of 1950, 15 FR 4935, 64 
Stat. 1280, 3 CFR, 1949-53 Comp., p. 1017))

[31 FR 10773, Aug. 13, 1966, as amended at 35 FR 13205, Aug. 19, 1970; 
42 FR 38353, July 28, 1977; 44 FR 4946, Jan. 24, 1979; 49 FR 6723, Feb. 
23, 1984; 57 FR 41095, Sept. 9, 1992; 59 FR 31528, June 20, 1994]



Sec. 10.52  Violation of regulations.

    A practitioner may be disbarred or suspended from practice before 
the Internal Revenue Service for any of the following:
    (a) Willfully violating any of the regulations contained in this 
part.
    (b) Recklessly or through gross incompetence (within the meaning of 
Sec. 10.51(j)) violating Sec. 10.33 or Sec. 10.34 of this part.

[59 FR 31528, June 20, 1994]



Sec. 10.53  Receipt of information concerning attorney, certified public accountant, enrolled agent, or enrolled actuary.

    If an officer or employee of the Internal Revenue Service has reason 
to believe that an attorney, certified public accountant, enrolled 
agent, or enrolled actuary has violated any provision of this part, or 
if any such officer or employee receives information to that effect, he 
shall promptly make a written report thereof, which report or a copy 
thereof shall be forwarded to the Director of Practice. If any other 
person has information of such violations, he may make a report thereof 
to the Director of Practice or to any officer or employee of the 
Internal Revenue Service.

[31 FR 10773, Aug. 13, 1966, as amended at 57 FR 41095, Sept. 9, 1992]



Sec. 10.54  Institution of proceeding.

    Whenever the Director of Practice has reason to believe that any 
attorney, certified public accountant, enrolled agent, or enrolled 
actuary has violated any provision of the laws or

[[Page 205]]

regulations governing practice before the Internal Revenue Service, he 
may reprimand such person or institute a proceeding for disbarment or 
suspension of such person. The proceeding shall be instituted by a 
complaint which names the respondent and is signed by the Director of 
Practice and filed in his office. Except in cases of willfulness, or 
where time, the nature of the proceeding, or the public interest does 
not permit, a proceeding will not be instituted under this section until 
facts or conduct which may warrant such action have been called to the 
attention of the proposed respondent in writing and he has been accorded 
opportunity to demonstrate or achieve compliance with all lawful 
requirements.

[31 FR 10773, Aug. 13, 1966, as amended at 57 FR 41095, Sept. 9, 1992]



Sec. 10.55  Conferences.

    (a) In general. The Director of Practice may confer with an 
attorney, certified public accountant, enrolled agent, or enrolled 
actuary concerning allegations of misconduct irrespective of whether a 
proceeding for disbarment or suspension has been instituted against him. 
If such conference results in a stipulation in connection with a 
proceeding in which such person is the respondent, the stipulation may 
be entered in the record at the instance of either party to the 
proceeding.
    (b) Resignation or voluntary suspension. An attorney, certified 
public accountant, enrolled agent, or enrolled actuary, in order to 
avoid the institution or conclusion of a disbarment or suspension 
proceeding, may offer his consent to suspension from practice before the 
Internal Revenue Service. An enrolled agent may also offer his 
resignation. The Director of Practice, in his discretion, may accept the 
offered resignation of an enrolled agent and may suspend an attorney, 
certified public accountant, or enrolled agent in accordance with the 
consent offered.

[31 FR 10773, Aug. 13, 1966, as amended at 35 FR 13206, Aug. 19, 1970; 
57 FR 41095, Sept. 9, 1992]



Sec. 10.56  Contents of complaint.

    (a) Charges. A complaint shall give a plain and concise description 
of the allegations which constitute the basis for the proceeding. A 
complaint shall be deemed sufficient if it fairly informs the respondent 
of the charges against him so that he is able to prepare his defense.
    (b) Demand for answer. In the complaint, or in a separate paper 
attached to the complaint, notification shall be given of the place and 
time within which the respondent shall file his answer, which time shall 
not be less than 15 days from the date of service of the complaint, and 
notice shall be given that a decision by default may be rendered against 
the respondent in the event he fails to file his answer as required.

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38353, July 28, 1977]



Sec. 10.57  Service of complaint and other papers.

    (a) Complaint. The complaint or a copy thereof may be served upon 
the respondent by certified mail, or first-class mail as hereinafter 
provided; by delivering it to the respondent or his attorney or agent of 
record either in person or by leaving it at the office or place of 
business of the respondent, attorney or agent; or in any other manner 
which has been agreed to by the respondent. Where the service is by 
certified mail, the return post office receipt duly signed by or on 
behalf of the respondent shall be proof of service. If the certified 
matter is not claimed or accepted by the respondent and is returned 
undelivered, complete service may be made upon the respondent by mailing 
the complaint to him by first-class mail, addressed to him at the 
address under which he is enrolled or at the last address known to the 
Director of Practice. If service is made upon the respondent or his 
attorney or agent of record in person or by leaving the complaint at the 
office or place of business of the respondent, attorney or agent, the 
verified return by the person making service, setting forth the manner 
of service, shall be proof of such service.

[[Page 206]]

    (b) Service of papers other than complaint. Any paper other than the 
complaint may be served upon an attorney, certified public accountant, 
or enrolled agent as provided in paragraph (a) of this section or by 
mailing the paper by first-class mail to the respondent at the last 
address known to the Director of Practice, or by mailing the paper by 
first-class mail to the respondent's attorney or agent of record. Such 
mailing shall constitute complete service. Notices may be served upon 
the respondent or his attorney or agent of record by telegraph.
    (c) Filing of papers. Whenever the filing of a paper is required or 
permitted in connection with a disbarment or suspension proceeding, and 
the place of filing is not specified by this subpart or by rule or order 
of the Administrative Law Judge, the paper shall be filed with the 
Director of Practice, Treasury Department, Washington, DC 20220. All 
papers shall be filed in duplicate.

[Dept. Circ. 230, Rev., 31 FR 10773, Aug. 13, 1966, as amended at 31 FR 
13992, Nov. 2, 1966; 42 FR 38354, July 28, 1977]



Sec. 10.58  Answer.

    (a) Filing. The respondent's answer shall be filed in writing within 
the time specified in the complaint or notice of institution of the 
proceeding, unless on application the time is extended by the Director 
of Practice or the Administrative Law Judge. The answer shall be filed 
in duplicate with the Director of Practice.
    (b) Contents. The answer shall contain a statement of facts which 
constitute the grounds of defense, and it shall specifically admit or 
deny each allegation set forth in the complaint, except that the 
respondent shall not deny a material allegation in the complaint which 
he knows to be true, or state that he is without sufficient information 
to form a belief when in fact he possesses such information. The 
respondent may also state affirmatively special matters of defense.
    (c) Failure to deny or answer allegations in the complaint. Every 
allegation in the complaint which is not denied in the answer shall be 
deemed to be admitted and may be considered as proved, and no further 
evidence in respect of such allegation need be adduced at a hearing. 
Failure to file an answer within the time prescribed in the notice to 
the respondent, except as the time for answer is extended by the 
Director of Practice or the Administrative Law Judge, shall constitute 
an admission of the allegations of the complaint and a waiver of 
hearing, and the Examiner may make his decision by default without a 
hearing or further procedure.

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38354, July 28, 1977]



Sec. 10.59  Supplemental charges.

    If it appears that the respondent in his answer, falsely and in bad 
faith, denies a material allegation of fact in the complaint or states 
that the respondent has no knowledge sufficient to form a belief, when 
he in fact possesses such information, or if it appears that the 
respondent has knowingly introduced false testimony during proceedings 
for his disbarment or suspension, the Director of Practice may thereupon 
file supplemental charges against the respondent. Such supplemental 
charges may be tried with other charges in the case, provided the 
respondent is given due notice thereof and is afforded an opportunity to 
prepare a defense thereto.



Sec. 10.60  Reply to answer.

    No reply to the respondent's answer shall be required, and new 
matter in the answer shall be deemed to be denied, but the Director of 
Practice may file a reply in his discretion or at the request of the 
Administrative Law Judge.

[31 FR 10773, Aug. 13, 1966 as amended at 42 FR 38354, July 28, 1977]



Sec. 10.61  Proof; variance; amendment of pleadings.

    In the case of a variance between the allegations in a pleading and 
the evidence adduced in support of the pleading, the Examiner may order 
or authorize amendment of the pleading to conform to the evidence: 
Provided, That the party who would otherwise be prejudiced by the 
amendment is given reasonable opportunity to meet the allegations of the 
pleading as amended; and the Administrative Law Judge

[[Page 207]]

shall make findings on any issue presented by the pleadings as so 
amended.

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38354, July 28, 1977]



Sec. 10.62  Motions and requests.

    Motions and requests may be filed with the Director of Practice or 
with the Administrative Law Judge.

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38354, July 28, 1977]



Sec. 10.63  Representation.

    A respondent or proposed respondent may appear in person or he may 
be represented by counsel or other representative who need not be 
enrolled to practice before the Internal Revenue Service. The Director 
may be represented by an attorney or other employee of the Internal 
Revenue Service.



Sec. 10.64  Administrative Law Judge.

    (a) Appointment. An Administrative Law Judge appointed as provided 
by 5 U.S.C. 3105 (1966), shall conduct proceedings upon complaints for 
the disbarment or suspension of attorneys, certified public accountants, 
or enrolled agents.
    (b) Powers of Examiner. Among other powers, the Examiner shall have 
authority, in connection with any disbarment or suspension proceeding 
assigned or referred to him, to do the following:
    (1) Administer oaths and affirmations;
    (2) Make rulings upon motions and requests, which rulings may not be 
appealed from prior to the close of a hearing except, at the discretion 
of the Administrative Law Judge, in extraordinary circumstances;
    (3) Determine the time and place of hearing and regulate its course 
and conduct;
    (4) Adopt rules of procedure and modify the same from time to time 
as occasion requires for the orderly disposition of proceedings;
    (5) Rule upon offers of proof, receive relevant evidence, and 
examine witnesses;
    (6) Take or authorize the taking of depositions;
    (7) Receive and consider oral or written argument on facts or law;
    (8) Hold or provide for the holding of conferences for the 
settlement or simplification of the issues by consent of the parties;
    (9) Perform such acts and take such measures as are necessary or 
appropriate to the efficient conduct of any proceeding; and
    (10) Make initial decisions.

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38353, 38354, July 28, 
1977]



Sec. 10.65  Hearings.

    (a) In general. An Administrative Law Judge will preside at the 
hearing on a complaint furnished under Sec. 10.54 for the disbarment or 
suspension of a practitioner. Hearings will be stenographically recorded 
and transcribed and the testimony of witnesses will be taken under oath 
or affirmation. Hearings will be conducted pursuant to 5 U.S.C. 556. A 
hearing in a proceeding requested under Sec. 10.76(g) will be conducted 
de novo.
    (b) Failure to appear. If either party to the proceeding fails to 
appear at the hearing, after due notice thereof has been sent to him, he 
shall be deemed to have waived the right to a hearing and the 
Administrative Law Judge may make his decision against the absent party 
by default.

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38354, July 28, 1977; 
59 FR 31528, June 20, 1994]



Sec. 10.66  Evidence.

    (a) In general. The rules of evidence prevailing in courts of law 
and equity are not controlling in hearings on complaints for the 
disbarment or suspension of attorneys, certified public accountants, and 
enrolled agents. However, the Administrative Law Judge shall exclude 
evidence which is irrelevant, immaterial, or unduly repetitious.
    (b) Depositions. The deposition of any witness taken pursuant to 
Sec. 10.67 may be admitted.
    (c) Proof of documents. Official documents, records, and papers of 
the Internal Revenue Service and the Office of Director of Practice 
shall be admissible in evidence without the production of an officer or 
employee to authenticate them. Any such documents, records,

[[Page 208]]

and papers may be evidenced by a copy attested or identified by an 
officer or employee of the Internal Revenue Service or the Treasury 
Department, as the case may be.
    (d) Exhibits. If any document, record, or other paper is introduced 
in evidence as an exhibit, the Administrative Law Judge may authorize 
the withdrawal of the exhibit subject to any conditions which he deems 
proper.
    (e) Objections. Objections to evidence shall be in short form, 
stating the grounds of objection relied upon, and the record shall not 
include argument thereon, except as ordered by the Administrative Law 
Judge. Rulings on such objections shall be a part of the record. No 
exception to the ruling is necessary to preserve the rights of the 
parties.

[31 FR 10773, Aug. 13, 1966, as amended at 35 FR 13206, Aug. 19, 1970; 
42 FR 38354, July 28, 1977]



Sec. 10.67  Depositions.

    Depositions for use at a hearing may, with the written approval of 
the Administrative Law Judge be taken by either the Director of Practice 
or the respondent or their duly authorized representatives. Depositions 
may be taken upon oral or written interrogatories, upon not less than 10 
days' written notice to the other party before any officer duly 
authorized to administer an oath for general purposes or before an 
officer or employee of the Internal Revenue Service who is authorized to 
administer an oath in internal revenue matters. Such notice shall state 
the names of the witnesses and the time and place where the depositions 
are to be taken. The requirement of 10 days' notice may be waived by the 
parties in writing, and depositions may then be taken from the persons 
and at the times and places mutually agreed to by the parties. When a 
deposition is taken upon written interrogatories, any cross-examination 
shall be upon written interrogatories. Copies of such written 
interrogatories shall be served upon the other party with the notice, 
and copies of any written cross-interrogation shall be mailed or 
delivered to the opposing party at least 5 days before the date of 
taking the depositions, unless the parties mutually agree otherwise. A 
party upon whose behalf a deposition is taken must file it with the 
Administrative Law Judge and serve one copy upon the opposing party. 
Expenses in the reporting of depositions shall be borne by the party at 
whose instance the deposition is taken.

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38354, July 28, 1977]



Sec. 10.68  Transcript.

    In cases where the hearing is stenographically reported by a 
Government contract reported, copies of the transcript may be obtained 
from the reporter at rates not to exceed the maximum rates fixed by 
contract between the Government and the reporter. Where the hearing is 
stenographically reported by a regular employee of the Internal Revenue 
Service, a copy thereof will be supplied to the respondent either 
without charge or upon the payment of a reasonable fee. Copies of 
exhibits introduced at the hearing or at the taking or depositions will 
be supplied to the parties upon the payment of a reasonable fee (Sec. 
501, Pub. L. 82-137, 65 Stat. 290 (31 U.S.C. 483a)).

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38354, July 28, 1977]



Sec. 10.69  Proposed findings and conclusions.

    Except in cases where the respondent has failed to answer the 
complaint or where a party has failed to appear at the hearing, the 
Administrative Law Judge prior to making his decision, shall afford the 
parties a reasonable opportunity to submit proposed findings and 
conclusions and supporting reasons therefor.

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38354, July 28, 1977]



Sec. 10.70  Decision of the Administrative Law Judge.

    As soon as practicable after the conclusion of a hearing and the 
receipt of any proposed findings and conclusions timely submitted by the 
parties, the Administrative Law Judge shall make the initial decision in 
the case. The decision shall include (a) a statement of findings and 
conclusions, as well as the reasons or basis therefor, upon all the

[[Page 209]]

material issues of fact, law, or discretion presented on the record, and 
(b) an order of disbarment, suspension, or reprimand or an order of 
dismissal of the complaint. The Administrative Law Judge shall file the 
decision with the Director of Practice and shall transmit a copy thereof 
to the respondent or his attorney of record. In the absence of an appeal 
to the Secretary of the Treasury, or review of the decision upon motion 
of the Secretary, the decision of the Administrative Law Judge shall 
without further proceedings become the decisions of the Secretary of the 
Treasury 30 days from the date of the Administrative Law Judge's 
decision.

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38354, July 28, 1977]



Sec. 10.71  Appeal to the Secretary.

    Within 30 days from the date of the Administrative Law Judge's 
decision, either party may appeal to the Secretary of the Treasury. The 
appeal shall be filed with the Director of Practice in duplicate and 
shall include exceptions to the decision of the Administrative Law Judge 
and supporting reasons for such exceptions. If an appeal is filed by the 
Director of Practice, he shall transmit a copy thereof to the 
respondent. Within 30 days after receipt of an appeal or copy thereof, 
the other party may file a reply brief in duplicate with the Director of 
Practice. If the reply brief is filed by the Director, he shall transmit 
a copy of it to the respondent. Upon the filing of an appeal and a reply 
brief, if any, the Director of Practice shall transmit the entire record 
to the Secretary of the Treasury.

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38354, July 28, 1977]



Sec. 10.72  Decision of the Secretary.

    On appeal from or review of the initial decision of the 
Administrative Law Judge, the Secretary of the Treasury will make the 
agency decision. In making his decision the Secretary of the Treasury 
will review the record or such portions thereof as may be cited by the 
parties to permit limiting of the issues. A copy of the Secretary's 
decision shall be transmitted to the respondent by the Director of 
Practice.

[31 FR 10773, Aug. 13, 1966, as amended at 42 FR 38354, July 28, 1977]



Sec. 10.73  Effect of disbarment or suspension; surrender of card.

    In case the final order against the respondent is for disbarment, 
the respondent shall not thereafter be permitted to practice before the 
Internal Revenue Service unless and until authorized to do so by the 
Director of Practice pursuant to Sec. 10.75. In case the final order 
against the respondent is for suspension, the respondent shall not 
thereafter be permitted to practice before the Internal Revenue Service 
during the period of suspension. If an enrolled agent is disbarred or 
suspended, he shall surrender his enrollment card to the Director of 
Practice for cancellation, in the case of disbarment, or for retention 
during the period of suspension.



Sec. 10.74  Notice of disbarment or suspension.

    Upon the issuance of a final order disbarring or suspending an 
attorney, certified public accountant, or enrolled agent, the Director 
of Practice shall give notice thereof to appropriate officers and 
employees of the Internal Revenue Service and to interested departments 
and agencies of the Federal Government. Notice in such manner as the 
Director of Practice may determine may be given to the proper 
authorities of the State by which the disbarred or suspended person was 
licensed to practice as an attorney or accountant.



Sec. 10.75  Petition for reinstatement.

    The Director of Practice may entertain a petition for reinstatement 
from any person disbarred from practice before the Internal Revenue 
Service after the expiration of 5 years following such disbarment. 
Reinstatement may not be granted unless the Director of Practice is 
satisfied that the petitioner, thereafter, is not likely to conduct 
himself contrary to the regulations in this

[[Page 210]]

part, and that granting such reinstatement would not be contrary to the 
public interest.

[31 FR 10773, Aug. 13, 1966, as amended at 35 FR 13206, Aug. 19, 1970]



Sec. 10.76  Expedited suspension upon criminal conviction or loss of license for cause.

    (a) When applicable. Whenever the Director has reason to believe 
that a practitioner is described in paragraph (b) of this section, the 
Director may institute a proceeding under this section to suspend the 
practitioner from practice before the Service.
    (b) To whom applicable. This section applies to any practitioner 
who, within 5 years of the date a complaint instituting a proceeding 
under this section is served--
    (1) Has had his or her license to practice as an attorney, certified 
public accountant, or actuary suspended or revoked for cause (not 
including a failure to pay a professional licensing fee) by any 
authority or court, agency, body, or board described in Sec. 10.51(g); 
or
    (2) Has been convicted of any crime under title 26 of the United 
States Code, or a felony under title 18 of the United States Code 
involving dishonesty or breach of trust.
    (c) Instituting a proceeding. A proceeding under this section will 
be instituted by a complaint that names the respondent, is signed by the 
Director, is filed in the Director's office, and is served according to 
the rules set forth in Sec. 10.57(a). The complaint must give a plain 
and concise description of the allegations that constitute the basis for 
the proceeding. The complaint, or a separate paper attached to the 
complaint, must notify the respondent--
    (1) Of the place and due date for filing an answer;
    (2) That a decision by default may be rendered if the respondent 
fails to file an answer as required;
    (3) That the respondent may request a conference with the Director 
to address the merits of the complaint and that any such request must be 
made in the answer; and
    (4) That the respondent may be suspended either immediately 
following the expiration of the period by which an answer must be filed 
or, if a conference is requested, immediately following the conference.
    (d) Answer. The answer to a complaint described in this section must 
be filed no later than 30 calendar days following the date the complaint 
is served, unless the Director extends the time for filing. The answer 
must be filed in accordance with the rules set forth in Sec. 10.58, 
except as otherwise provided in this section. A respondent is entitled 
to a conference with the Director only if the conference is requested in 
a timely filed answer. If a request for a conference is not made in the 
answer or the answer is not timely filed, the respondent will be deemed 
to have waived his or her right to a conference and the Director may 
suspend such respondent at any time following the date on which the 
answer was due.
    (e) Conference. The Director or his or her designee will preside at 
a conference described in this section. The conference will be held at a 
place and time selected by the Director, but no sooner than 14 calendar 
days after the date by which the answer must be filed with the Director, 
unless the respondent agrees to an earlier date. An authorized 
representative may represent the respondent at the conference. Following 
the conference, upon a finding that the respondent is described in 
paragraph (b) of this section, or upon the respondent's failure to 
appear at the conference either personally or through an authorized 
representative, the Director may immediately suspend the respondent from 
practice before the Service.
    (f) Duration of suspension. A suspension under this section will 
commence on the date that written notice of the suspension is issued. A 
practitioner's suspension will remain effective until the earlier of the 
following--
    (1) The Director lifts the suspension after determining that the 
practitioner is no longer described in paragraph (b) of this section or 
for any other reason; or
    (2) The suspension is lifted by an Administrative Law Judge or the 
Secretary of the Treasury in a proceeding referred to in paragraph (g) 
of this section and instituted under Sec. 10.54.
    (g) Proceeding instituted under Sec. 10.54. If the Director suspends 
a practitioner

[[Page 211]]

under this Sec. 10.76, the practitioner may ask the Director to issue a 
complaint under Sec. 10.54. The request must be made in writing within 2 
years from the date on which the practitioner's suspension commences. 
The Director must issue a complaint requested under this paragraph 
within 30 calendar days of receiving the request.

[59 FR 31528, June 20, 1994]



      Subpart D--Rules Applicable to Disqualification of Appraisers

    Source: 50 FR 42016, Oct. 17, 1985, unless otherwise noted.



Sec. 10.77  Authority to disqualify; effect of disqualification.

    (a) Authority to disqualify. Pursuant to section 156 of the Deficit 
Reduction Act of 1984, 98 Stat. 695, amending 31 U.S.C. 330, the 
Secretary of the Treasury, after due notice and opportunity for hearing 
may disqualify any appraiser with respect to whom a penalty has been 
assessed after July 18, 1984, under section 6701(a) of the Internal 
Revenue Code of 1954, as amended (26 U.S.C. 6701(a)).
    (b) Effect of disqualification. If any appraiser is disqualified 
pursuant to 31 U.S.C. 330 and this subpart:
    (1) Appraisals by such appraiser shall not have any probative effect 
in any administrative proceeding before the Department of the Treasury 
or the Internal Revenue Service; and
    (2) Such appraiser shall be barred from presenting evidence or 
testimony in any such administrative proceeding. Paragraph (b)(1) of 
this section shall apply to appraisals made by such appraiser after the 
effective date of disqualification, but shall not apply to appraisals 
made by the appraiser on or before such date. Notwithstanding the 
foregoing sentence, an appraisal otherwise barred from admission into 
evidence pursuant to paragraph (b)(1) of this section may be admitted 
into evidence solely for the purpose of determining the taxpayer's 
reliance in good faith on such appraisal. Paragraph (b)(2) of this 
section shall apply to the presentation of testimony or evidence in any 
administrative proceeding after the date of such disqualification, 
regardless of whether such testimony or evidence would pertain to an 
appraisal made prior to such date.



Sec. 10.78  Institution of proceeding.

    (a) In general. Whenever the Director of Practice is advised or 
becomes aware that a penalty has been assessed against an appraiser 
under 26 U.S.C. 6701(a), he/she may reprimand such person or institute a 
proceeding for disqualification of such appraiser through the filing of 
a complaint. Irrespective of whether a proceeding for disqualification 
has been instituted against an appraiser, the Director of Practice may 
confer with an appraiser against whom such a penalty has been assessed 
concerning such penalty.
    (b) Voluntary disqualification. In order to avoid the initiation or 
conclusion of a disqualification proceeding, an appraiser may offer his/
her consent to disqualification. The Director of Practice, in his/her 
discretion, may disqualify an appraiser in accordance with the consent 
offered.



Sec. 10.79  Contents of complaint.

    (a) Charges. A proceeding for disqualification of an appraiser shall 
be instituted through the filing of a complaint, which shall give a 
plain and concise description of the allegations that constitute the 
basis for the proceeding. A complaint shall be deemed sufficient if it 
refers to the penalty previously imposed on the respondent under section 
6701(a) of the Internal Revenue Code of 1954, as amended (26 U.S.C. 
6701(a)), and advises him/her of the institution of the proceeding.
    (b) Demand for answer. In the complaint, or in a separate paper 
attached to the complaint, notification shall be given of the place and 
time within which the respondent shall file his/her answer, which time 
shall not be less than 15 days from the date of service of the 
complaint, and notice shall be given that a decision by default may be 
rendered against the respondent in the event there is failure to file an 
answer.



Sec. 10.80  Service of complaint and other papers.

    (a) Complaint. The complaint or a copy thereof may be served upon 
the respondent by certified mail, or first-

[[Page 212]]

class mail as hereinafter provided, by delivering it to the respondent 
or his/her attorney or agent of record either in person or by leaving it 
at the office or place of business of the respondent, attorney or agent, 
or in any other manner that has been agreed to by the respondent. Where 
the service is by certified mail, the return post office receipt duly 
signed by or on behalf of the respondent shall be proof of service. If 
the certified mail is not claimed or accepted by the respondent and is 
returned undelivered, complete service may be made by mailing the 
complaint to the respondent by first-class mail, addressed to the 
respondent at the last address known to the Director of Practice. If 
service is made upon the respondent in person or by leaving the 
complaint at the office or place of business of the respondent, the 
verified return by the person making service, setting forth the manner 
of service, shall be proof of such service.
    (b) Service of papers other than complaint. Any paper other than the 
complaint may be served as provided in paragraph (a) of this section or 
by mailing the paper by first-class mail to the respondent at the last 
address known to the Director of Practice, or by mailing the paper by 
first-class mail to the respondent's attorney or agent of record. Such 
mailing shall constitute complete service. Notices may be served upon 
the respondent or his/her attorney or agent of record by telegraph.
    (c) Filing of papers. Whenever the filing of a paper is required or 
permitted in connection with a disqualification proceeding under this 
subpart or by rule or order of the Administrative Law Judge, the paper 
shall be filed with the Director of Practice, Treasury Department, 
Internal Revenue Service, Washington, DC 29224. All papers shall be 
filed in duplicate.



Sec. 10.81  Answer.

    (a) Filing. The respondent's answer shall be filed in writing within 
the time specified in the complaint or notice of institution of the 
proceeding, unless on application the time is extended by the Director 
of Practice or the Administrative Law Judge. The answer shall be filed 
in duplicate with the Director of Practice.
    (b) Contents. The answer shall contain a statement of facts that 
constitute the grounds of defense, and it shall specifically admit or 
deny each allegation set forth in the complaint, except that the 
respondent shall not deny a material allegation in the complaint that 
he/she knows to be true, or state that he/she is without sufficient 
information to form a belief when in fact he/she possesses such 
information.
    (c) Failure to deny or answer allegations in the complaint. Every 
allegation in the complaint which is not denied in the answer shall be 
deemed to be admitted and may be considered as proved, and no further 
evidence in respect of such allegation need be adduced at a hearing. 
Failure to file an answer within the time prescribed in the notice to 
the respondent, except as the time for answer is extended by the 
Director of Practice or the Administrative Law Judge, shall constitute 
an admission of the allegations of the complaint and a waiver of 
hearing, and the Administrative Law Judge may make his/her decision by 
default without a hearing or further procedure.



Sec. 10.82  Supplemental charges.

    If it appears that the respondent in his/her answer, falsely and in 
bad faith, denies a material allegation of fact in the complaint or 
states that the respondent has no knowledge sufficient to form a belief, 
when he/she in fact possesses such information, or if it appears that 
the respondent has knowingly introduced false testimony during 
proceedings for his/her disqualification, the Director of Practice may 
thereupon file supplemental charges against the respondent. Such 
supplemental charges may be tried with other charges in the case, 
provided the respondent is given due notice thereof and is afforded an 
opportunity to prepare a defense thereto.



Sec. 10.83  Reply to answer.

    No reply to the respondent's answer shall be required, and any new 
matter in the answer shall be deemed to be denied, but the Director of 
Practice may file a reply in his/her discretion or at

[[Page 213]]

the request of the Administrative Law Judge.



Sec. 10.84  Proof, variance, amendment of pleadings.

    In the case of a variance between the allegations in a pleading and 
the evidence adduced in support of the pleading, the Administrative Law 
Judge may order or authorize amendment of the pleading to conform to the 
evidence; provided, that the party who would otherwise be prejudiced by 
the amendment is given reasonable opportunity to meet the allegations of 
the pleading as amended, and the Administrative Law Judge shall make 
findings on any issue presented by the pleadings as so amended.



Sec. 10.85  Motions and requests.

    Motions and requests may be filed with the Director of Practice or 
with the Administrative Law Judge.



Sec. 10.86  Representation.

    A respondent may appear in person or may be represented by counsel 
or other representative. The Director of Practice may be represented by 
an attorney or other employee of the Department of the Treasury.



Sec. 10.87  Administrative Law Judge.

    (a) Appointment. An Administrative Law Judge appointed as provided 
by 5 U.S.C. 3105, shall conduct proceedings upon complaints for the 
disqualification of appraisers.
    (b) Powers of Administrative Law Judge. Among other powers, the 
Administrative Law Judge shall have authority, in connection with any 
disqualification proceeding assigned or referred to him/her, to do the 
following:
    (1) Administer oaths and affirmations;
    (2) Make rulings upon motions and requests, which rulings may not be 
appealed from prior to the close of a hearing except at the discretion 
of the Administrative Law Judge, in extraordinary circumstances;
    (3) Determine the time and place of hearing and regulate its course 
and conduct;
    (4) Adopt rules of procedure and modify the same from time to time 
as occasion requires for the orderly disposition of proceedings;
    (5) Rule upon offers of proof, receive relevant evidence, and 
examine witnesses;
    (6) Take or authorize the taking of depositions;
    (7) Receive and consider oral or written argument on facts or law;
    (8) Hold or provide for the holding of conferences for the 
settlement or simplification of the issues by consent of the parties;
    (9) Perform such acts and take such measures as are necessary or 
appropriate to the efficient conduct of any proceeding; and
    (10) Make initial decisions.



Sec. 10.88  Hearings.

    (a) In general. The Administrative Law Judge shall preside at the 
hearing on a complaint for the disqualification of an appraiser. 
Hearings shall be stenographically recorded and transcribed and the 
testimony of witnesses shall be taken under oath or affirmation. 
Hearings will be conducted pursuant to 5 U.S.C. 556.
    (b) Failure to appear. If either party to the proceeding fails to 
appear at the hearing after due notice thereof has been sent to him/her, 
the right to a hearing shall be deemed to have been waived and the 
Administrative Law Judge may make a decision by default against the 
absent party.



Sec. 10.89  Evidence.

    (a) In general. The rules of evidence prevailing in courts of law 
and equity are not controlling in hearings on complaints for the 
disqualification of appraisers. However, the Administrative Law Judge 
shall exclude evidence which is irrelevant, immaterial, or unduly 
repetitious.
    (b) Depositions. The deposition of any witness taken pursuant to 
Sec. 10.90 may be admitted.
    (c) Proof of documents. Official documents, records, and papers of 
the Internal Revenue Service or the Department of the Treasury shall be 
admissible in evidence without the production of an officer or employee 
to authenticate them. Any such documents, records, and papers may be 
evidenced by a copy attested or identified by an officer or

[[Page 214]]

employee of the Internal Revenue Service or the Department of the 
Treasury, as the case may be.
    (d) Exhibits. If any document, record, or other paper is introduced 
in evidence as an exhibit, the Administrative Law Judge may authorize 
the withdrawal of the exhibit subject to any conditions which he/she 
deems proper.
    (e) Objections. Objections to evidence shall be in short form, 
stating the grounds of objection relied upon, and the record shall not 
include argument thereon, except as ordered by the Administrative Law 
Judge. Rulings on such objections shall be a part of the record. No 
exception to the ruling is necessary to preserve the rights of the 
parties.



Sec. 10.90  Depositions.

    Depositions for use at a hearing may, with the written approval of 
the Administrative Law Judge, be taken either by the Director of 
Practice or the respondent or their duly authorized representatives. 
Depositions may be taken upon oral or written interrogatories, upon not 
less than 10 days' written notice to the other party before any officer 
duly authorized to administer an oath for general purposes or before an 
officer or employee of the Internal Revenue Service who is authorized to 
administer an oath in internal revenue matters. Such notice shall state 
the names of the witnesses and the time and place where the depositions 
are to be taken. The requirement of 10 days' notice may be waived by the 
parties in writing, and depositions may then be taken from the persons 
and at the times and places mutually agreed to by the parties. When a 
deposition is taken upon written interrogatories, any cross-examination 
shall be upon written interrogatories. Copies of such written 
interrogatories shall be served upon the other party with the notice, 
and copies of any written cross-interrogation shall be mailed or 
delivered to the opposing party at least 5 days before the date of 
taking the depositions, unless the parties mutually agree otherwise. A 
party upon whose behalf a deposition is taken must file it with the 
Administrative Law Judge and serve one copy upon the opposing party. 
Expenses in the reporting of depositions shall be borne by the party at 
whose instance the deposition is taken.



Sec. 10.91  Transcript.

    In cases where the hearing is stenographically reported by a 
Government contract reporter, copies of the transcript may be obtained 
from the reporter at rates not to exceed the maximum rates fixed by 
contract between the Government and the reporter. Where a hearing is 
stenographically reported by a regular employee of the Internal Revenue 
Service, a copy thereof will be supplied to the respondent either 
without charge or upon the payment of a reasonable fee. Copies of 
exhibits introduced at the hearing or at the taking of depositions will 
be supplied to the parties upon the payment of a reasonable fee (Sec. 
501, Pub. L. 82-137, 65 Stat. 290 (31 U.S.C. 483a)).



Sec. 10.92  Proposed findings and conclusions.

    Except in cases where the respondent has failed to answer the 
complaint or where a party has failed to appear at the hearing, the 
Administrative Law Judge, prior to making a decision, shall afford the 
parties a reasonable opportunity to submit proposed findings and 
conclusions and supporting reasons therefor.



Sec. 10.93  Decision of the Administrative Law Judge.

    As soon as practicable after the conclusion of a hearing and the 
receipt of any proposed findings and conclusions timely submitted by the 
parties, the Administrative Law Judge shall make the initial decision in 
the case. The decision shall include (a) a statement of findings and 
conclusions, as well as the reasons or basis therefor, upon all the 
material issues of fact, law, or discretion presented on the record, and 
(b) an order of disqualification or an order of dismissal of the 
complaint. The Administrative Law Judge shall file the decision with the 
Director of Practice and shall transmit a copy thereof to the respondent 
or his attorney of record. In the absence of an appeal to the Secretary 
of the Treasury, or review of the decision upon motion of the Secretary, 
the decision of the Administrative Law

[[Page 215]]

Judge shall without further proceedings become the decision of the 
Secretary of the Treasury 30 days from the date of the Administrative 
Law Judge's decision.



Sec. 10.94  Appeal to the Secretary.

    Within 30 days from the date of the Administrative Law Judge's 
decision, either party may appeal such decision to the Secretary of the 
Treasury. If an appeal is by the respondent, the appeal shall be filed 
with the Director of Practice in duplicate and shall include exceptions 
to the decision of the Administrative Law Judge and supporting reasons 
for such exceptions. If an appeal is filed by the Director of Practice, 
a copy thereof shall be transmitted to the respondent. Within 30 days 
after receipt of an appeal or copy thereof, the other party may file a 
reply brief in duplicate with the Director of Practice. If the reply 
brief is filed by the Director, a copy shall be transmitted to the 
respondent. Upon the filing of an appeal and a reply brief, if any, the 
Director of Practice shall transmit the entire record to the Secretary 
of the Treasury.



Sec. 10.95  Decision of the Secretary.

    On appeal from or review of the initial decision of the 
Administrative Law Judge, the Secretary of the Treasury shall make the 
agency decision. In making such decision, the Secretary of the Treasury 
will review the record or such portions thereof as may be cited by the 
parties. A copy of the Secretary's decision shall be transmitted to the 
respondent by the Director of Practice.



Sec. 10.96  Final order.

    Upon the issuance of a final order disqualifying an appraiser, the 
Director of Practice shall give notice thereof to appropriate officers 
and employees of the Internal Revenue Service and to interested 
departments and agencies of the Federal Government.



Sec. 10.97  Petition for reinstatement.

    The Director of Practice may entertain a petition for reinstatement 
from any disqualified appraiser after the expiration of 5 years 
following such disqualification. Reinstatement may not be granted unless 
the Director of Practice is satisfied that the petitioner, thereafter, 
is not likely to conduct himself/herself contrary to 26 U.S.C. 6701(a), 
and that granting such reinstatement would not be contrary to the public 
interest.



                      Subpart E--General Provisions



Sec. 10.98  Records.

    (a) Availability. There are made available to public inspection at 
the Office of Director of Practice the roster of all persons enrolled to 
practice, the roster of all persons disbarred or suspended from 
practice, and the roster of all disqualified appraisers. Other records 
may be disclosed upon specific request, in accordance with the 
disclosure regulations of the Internal Revenue Service and the Treasury 
Department.
    (b) Disciplinary procedures. A request by a practitioner that a 
hearing in a disciplinary proceeding concerning him be public, and that 
the record thereof be made available for inspection by interested 
persons may be granted if agreement is reached by stipulation in advance 
to protect from disclosure tax information which is confidential, in 
accordance with the applicable statutes and regulations.

[31 FR 10773, Aug. 13, 1966. Redesignated at 50 FR 42016, Oct. 17, 1985, 
and amended at 50 FR 42018, Oct. 17, 1985]



Sec. 10.100  Saving clause.

    Any proceeding for the disbarment or suspension of an attorney, 
certified public accountant, or enrolled agent, instituted but not 
closed prior to the effective date of these revised regulations, shall 
not be affected by such regulations. Any proceeding under this part 
based on conduct engaged in prior to the effective date of these 
regulations may be instituted subsequent to such effective date.

[50 FR 42019, Oct. 17, 1985]



Sec. 10.101  Special orders.

    The Secretary of the Treasury reserves the power to issue such 
special orders as he may deem proper in any cases within the purview of 
this part.

[31 FR 10773, Aug. 13, 1966. Redesignated at 50 FR 42016, Oct. 17, 1985]

[[Page 216]]



PART 11--OPERATION OF VENDING FACILITIES BY THE BLIND ON FEDERAL PROPERTY UNDER THE CONTROL OF THE DEPARTMENT OF THE TREASURY--Table of Contents




Sec.
11.1  Purpose.
11.2  Policy.
11.3  Definitions.
11.4  Establishing vending facilities.
11.5  Application for permit.
11.6  Terms of permit.
11.7  Enforcement procedures.
11.8  Reports.

    Authority: 49 Stat. 1559, as amended by Act of Aug. 3, 1954, Pub. L. 
83-565, 68 Stat. 663, as further amended by Pub. L. 93-516, 88 Stat. 
1622, (20 U.S.C. 107).

    Source: 58 FR 57560, Oct. 26, 1993, unless otherwise noted.



Sec. 11.1  Purpose.

    This part contains policy and procedures to ensure the priority of 
blind vendors in operating vending facilities on property controlled by 
the Department of the Treasury. The provisions of this part apply to all 
bureaus, the Departmental Offices and the Office of Inspector General.



Sec. 11.2  Policy.

    Blind vendors licensed by State licensing agencies designated by the 
Secretary of Education under the provisions of the Randolph-Sheppard Act 
(20 U.S.C. 107 et seq.) shall be given priority in the location and 
operation of vending facilities, including vending machines, on property 
controlled by the Department of the Treasury, provided the location or 
operation of such facility would not adversely affect the interests of 
the United States. Treasury bureaus shall ensure that the collection and 
distribution of vending machine income from vending machines on 
Treasury-controlled property shall be in compliance with the regulations 
set forth in 34 CFR 395.32. Blind vendors shall also be given priority 
on Treasury-controlled property in the operation of cafeterias according 
to 34 CFR 395.33.



Sec. 11.3  Definitions.

    Terms used are defined in 34 CFR 395.1, except that as used in this 
part, the following terms shall have the following meanings:
    (a) Department of the Treasury controlled property means any Federal 
building, land, or other real property owned, leased, or occupied by a 
bureau or office of the Department of the Treasury, of which the 
maintenance, operation, and protection is under the control of the 
Department of the Treasury.
    (b) The term bureau means any bureau or office of the Department of 
the Treasury and such comparable administrative units as may hereafter 
be created or made a part of the Department, and includes the 
Departmental Offices and the Office of Inspector General. The ``head of 
the bureau'' for the Departmental Offices is the Deputy Assistant 
Secretary (Administration).



Sec. 11.4  Establishing vending facilities.

    (a) Treasury bureaus shall not acquire a building by ownership, 
rent, or lease, or occupy a building to be constructed, substantially 
altered, or renovated unless it is determined that such buildings 
contain or will contain a ``satisfactory site,'' as defined in 34 CFR 
395.1(q), for the location and operation of a blind vending facility.
    (b) In accordance with 34 CFR 395.31, Treasury bureaus shall provide 
the appropriate State licensing agency with written notice of the 
intention to acquire or otherwise occupy such building. Providing 
notification shall be the responsibility of the bureau on-site property 
management official.



Sec. 11.5  Application for permit.

    Applications for permits for the operation of vending facilities 
other than cafeterias shall be made in writing and submitted for the 
review and approval of the head of the appropriate Treasury bureau or 
that official's designee.



Sec. 11.6  Terms of permit.

    Every permit shall describe the location of the vending facility, 
including any vending machines located on other than facility premises, 
and shall be subject to the following provisions:
    (a) The permit shall be issued in the name of the applicant State 
licensing agency which shall perform the responsibilities set forth in 
34 CFR 395.35 (a);

[[Page 217]]

    (b) The permit shall be issued for an indefinite period of time 
subject to suspension or termination on the basis of compliance or 
noncompliance with agreed upon terms.
    (c) The permit shall provide that:
    (1) No charge shall be made to the State licensing agency for normal 
cleaning, maintenance, and repair of the building structure in and 
adjacent to the vending facility areas;
    (2) Cleaning necessary for sanitation; the maintenance of vending 
facilities and vending machines in an orderly condition at all times; 
the installation, maintenance, repair, replacement, servicing, and 
removal of vending facility equipment shall be without cost to the 
Department of the Treasury; and
    (3) Articles sold at vending facilities operated by blind licensees 
may consist of newspapers, periodicals, publications, confections, 
tobacco products, foods, beverages, chances for any lottery authorized 
by State law and conducted by an agency of a State within such State, 
and other articles or services as are determined by the State licensing 
agency, in consultation with the appropriate Treasury bureau, to be 
suitable for a particular location. Such articles and services may be 
dispensed automatically or manually and may be prepared on or off the 
premises.
    (d) The permit shall further provide that vending facilities shall 
be operated in compliance with applicable health, sanitation, and 
building codes or ordinances.
    (e) The permit shall further provide that installation, 
modification, relocation, removal, and renovation of vending facilities 
shall be subject to the prior approval and supervision of the bureau on-
site property management officer of the appropriate Treasury bureau and 
the State licensing agency; that costs of relocations initiated by the 
State licensing agency shall be paid by the State licensing agency; that 
costs of relocations initiated by a Treasury bureau shall be paid by the 
Treasury bureau; and that all plumbing, electrical, and mechanical costs 
related to the renovation of existing facilities shall be paid by the 
appropriate Treasury bureau.
    (f) The operation of a cafeteria by a blind vendor shall be covered 
by a contractual agreement and not by a permit. The State licensing 
agency shall be expected to perform under the same contractual 
arrangement applicable to commercial cafeteria operators.



Sec. 11.7  Enforcement procedures.

    (a) The State licensing agency shall attempt to resolve day-to-day 
problems pertaining to the operation of the vending facility in an 
informal manner with the participation of the blind vendor and the on-
site property management officials of the respective Treasury bureaus 
who are responsible for the Treasury-controlled property.
    (b) Unresolved disagreements concerning the terms of the permit, the 
Act, or the regulations in this part and any other unresolved matters 
shall be reported in writing to the State licensing agency supervisory 
personnel by the bureau on-site supervisory property management official 
in an attempt to resolve the issue.



Sec. 11.8  Reports.

    This section establishes a Department of the Treasury reporting 
requirement to comply with 34 CFR 395.38. At the end of each fiscal 
year, each property managing bureau shall submit a report to the 
Director, Office of Management Support Systems, Departmental Offices, 
containing the elements set forth in 34 CFR 395.38. The Director, Office 
of Management Support Systems, shall submit a consolidated report to the 
Secretary of Education after the end of the fiscal year.



PART 12--RESTRICTION OF SALE AND DISTRIBUTION OF TOBACCO PRODUCTS--Table of Contents




Sec.
12.1  Purpose.
12.2  Definitions.
12.3  Sale of tobacco products in vending machines prohibited.
12.4  Distribution of free samples of tobacco products prohibited.
12.5  Prohibitions not applicable in areas designated by the Secretary 
          of the Treasury.

    Authority: Sec. 636, Pub. L. 104-52, 109 Stat. 507.

    Source: 61 FR 25396, May 21, 1996, unless otherwise noted.

[[Page 218]]



Sec. 12.1  Purpose.

    This part contains regulations implementing the ``Prohibition of 
Cigarette Sales to Minors in Federal Buildings Act,'' Public Law 104-52, 
Section 636, with respect to buildings under the jurisdiction of the 
Department of the Treasury.



Sec. 12.2  Definitions.

    As used in this part--
    (1) The term Federal building under the jurisdiction of the 
Secretary of the Treasury includes the real property on which such 
building is located;
    (2) The term minor means an individual under the age of 18 years; 
and
    (3) The term tobacco product means cigarettes, cigars, little 
cigars, pipe tobacco, smokeless tobacco, snuff, and chewing tobacco.



Sec. 12.3  Sale of tobacco products in vending machines prohibited.

    The sale of tobacco products in vending machines located in or 
around any Federal building under the jurisdiction of the Secretary of 
the Treasury is prohibited, except in areas designated pursuant to 
Sec. 12.5 of this part.



Sec. 12.4  Distribution of free samples of tobacco products prohibited.

    The distribution of free samples of tobacco products in or around 
any Federal building under the jurisdiction of the Secretary of the 
Treasury is prohibited, except in areas designated pursuant to Sec. 12.5 
of this part.



Sec. 12.5  Prohibitions not applicable in areas designated by the Secretary of the Treasury.

    The prohibitions set forth in this part shall not apply in areas 
designated by the Secretary as exempt from the prohibitions, but all 
designated areas must prohibit the presence of minors.



PART 13--PROCEDURES FOR PROVIDING ASSISTANCE TO STATE AND LOCAL GOVERNMENTS IN PROTECTING FOREIGN DIPLOMATIC MISSIONS--Table of Contents




Sec.
13.1  Purpose.
13.2  Definitions.
13.3  Eligibility to receive protection or reimbursement.
13.4  Requests for protection and advance notices of reimbursement 
          requests.
13.5  Utilization of the services, personnel, equipment, and facilities 
          of State and local govenments.
13.6  Reimbursement of State and local governments.
13.7  Reimbursement when the Assistant Secretary makes no determination 
          to utilize State and local government services, personnel, 
          equipment and facilities.
13.8  Protection for motorcades and other places associated with a visit 
          qualifying under section 202(7) of Title 3, U.S. Code.

Appendix I(F) to Part 13--Estimated Overhead and Administrative Costs
Appendix II(F) to Part 13--Overhead and Administrative Costs
Appendix I to Part 13--Form of Request for Assistance
Appendix II to Part 13--Form of Bill for Reimbursement

    Authority: Secs. 202 and 208, Title 3, U.S. Code, as amended and 
added, respectively by Pub. L. 94-196 (89 Stat. 1109); 5 U.S.C. 301.

    Source: 41 FR 55179, Dec. 17, 1976, unless otherwise noted.



Sec. 13.1  Purpose.

    This part prescribes the procedures governing protective and 
financial assistance to State and local governments when an 
extraordinary protective need requires the protection of foreign 
diplomatic missions as authorized by sections 202 and 208 of Title 3, 
U.S. Code, as amended and added, respectively, by Pub. L. 94-196 (89 
Stat. 1109).



Sec. 13.2  Definitions.

    As used in this part, these terms shall have the following meaning:
    (a) The term Assistant Secretary means the Assistant Secretary of 
the Treasury (Enforcement and Operations).
    (b) The term extraordinary protective need means a need for 
protection requiring measurable reinforcements of police personnel or 
equipment, or both, significantly beyond the ordinary deployment of the 
State or local government, arising out of actual or potential violence 
related to: (1) Confrontations between nationalist or other groups, (2) 
threats or acts of violence by terrorist or other groups, (3) a specific 
diplomatic event or visit, or (4) a specific international event.

[[Page 219]]

    (c) The term foreign diplomatic mission means a mission (including 
foreign consular offices) of a foreign country located in the United 
States.
    (d) The term full time officers means permanent officers whose 
duties as foreign diplomatic officers occupy their full time.
    (e) The term international organization means those international 
organizations designated by Presidential Executive Order as being 
entitled to the privileges, immunities, and exemptions accorded under 
the International Organization Immunities Act of December 29, 1945 (22 
U.S.C. 288).
    (f) The term metropolitan area means a city in the United States 
(other than the District of Columbia) and those areas contiguous to it.
    (g) The term observer mission means a mission invited to participate 
in the work of an international organization by that organization. The 
invitation to participate shall be extended by the international 
organization pursuant to the same internal rules of the international 
organization as are applicable to any permanent mission.
    (h) The term permanent mission means a fixed continuing mission 
staffed by full time officers and maintained by a member state of an 
international organization.
    (i) The term temporary domicile means a domicile of limited duration 
of a visiting foreign dignitary or officer in connection with a visit to 
a permanent or observer mission to an international organization in a 
metropolitan area.

[41 FR 55179, Dec. 17, 1976, as amended at 45 FR 30621, May 9, 1980]



Sec. 13.3  Eligibility to receive protection or reimbursement.

    (a) Protection, as determined by the Assistant Secretary, will be 
provided by the United States Secret Service Uniformed Division, 
pursuant to section 202 of Title 3, U.S. Code, as amended by Pub. L. 94-
196, only to foreign diplomatic missions located in metropolitan areas 
(other than the District of Columbia) where there are located twenty or 
more such missions, as determined by the Secretary of State, which are 
headed by full time officers. According to present State Department 
figures, the following metropolitan areas have 20 or more such foreign 
diplomatic missions: Chicago, Houston, Los Angeles, Miami, New York 
City, New Orleans and San Francisco. The protection provided by State or 
local governments rather than the United States Secret Service Uniformed 
Division will be reimbursed pursuant to section 208(a) of Title 3, U.S. 
Code and Secs. 13.6, 13.7 and 13.8 of this part.
    (b) Protection or reimbursement will be provided for the 
metropolitan areas described in paragraph (a) of this section only if:
    (1) The affected metropolitan area requests such protection or 
reimbursement;
    (2) The Assistant Secretary determines that an extraordinary 
protective need exists; and
    (3) The extraordinary need arises in association with a visit to or 
occurs at or, pursuant to Sec. 13.6, in the vicinity of: (i) A permanent 
mission to an international organization of which the United States is a 
member, (ii) an observer mission invited to participate in the work of 
an international organization of which the United States is a member, or 
(iii) in the case of a visit by a foreign official or dignitary to 
participate in an activity of an international organization of which the 
United States is a member, a foreign diplomatic mission, including a 
consular office of the same country as the visitor.
    (c) Protection (or reimbursement) may be extended at places of 
temporary domicile in connection with a visit under paragraph (b) of 
this section.
    (d) Where an extraordinary protective need exists, protection (or 
reimbursement) may be extended to missions as described in 
Secs. 13.3(b)(3) (i) and (ii) whether or not associated with a visit by 
a foreign dignitary.

[45 FR 30621, May 9, 1980]



Sec. 13.4  Requests for protection and advance notices of reimbursement requests.

    (a) In cases where they believe that an extraordinary protective 
need exists, the State or local governments may request that protection 
be provided by the United States Secret Service Uniformed Division; or 
they may

[[Page 220]]

give advance notice of their intention to provide, on a reimbursable 
basis, all or part of the protection themselves.
    (1) Requests for protection or advance notices of reimbursement 
requests shall be made to: Assistant Secretary (Enforcement and 
Operations), Department of the Treasury, Washington, DC 20220. Each 
government requesting the protection authorized pursuant to section 202 
of Title 3, U.S. Code, as amended by Pub. L. 94-196, or which intends to 
seek reimbursement pursuant to section 208(a) of Title 3, U.S. Code and 
Secs. 13.6 and 13.7 of this part, shall submit an application describing 
the extraordinary protective need. Applications made pursuant to this 
section shall be submitted to the Assistant Secretary 14 days before the 
extraordinary protective need arises. In association with a visit, the 
application shall include the name and title of the visiting foreign 
official or dignitary, the country he represents, and the name and 
location of the international organization or mission he will be 
visting. The application shall also include, if available, the temporary 
domicile of the visiting official or dignitary and his schedule, 
including dates and times of arrival and departure from the United 
States. If the extraordinary protective need occurs at a permanent 
mission to an international organization of which the United States is a 
member or an observer mission invited to participate in the work of such 
organization, or if another foreign diplomatic mission of the country 
qualifies under Sec. 13.3 (b) or (d), the application shall include the 
name and location of the mission.
    (b) State and local governments shall also indicate on the 
application whether they are requesting the use of the United States 
Secret Service Uniformed Division or whether they are giving advance 
notice of their intention to provide, on a reimbursable basis, all or 
part of the protection themselves. In order to assist the Assistant 
Secretary in determining whether to utilize the United States Secret 
Service Uniformed Division to meet all or part of the extraordinary 
protective need, or to utilize, with their consent, the services, 
personnel, equipment, and facilities of the State or local government, 
or both, the application must include an estimate of the approximate 
number of personnel by grade and rank, the services, equipment, and 
facilities required, along with an estimate of the cost of such 
personnel, services, equipment and facilities. This application must be 
submitted in a format consistent with that illustrated in Appendix I of 
this part.
    (1) Upon receipt of a request for protection pursuant to paragraph 
(a)(1) of this section and for the purposes of reimbursement pursuant to 
Secs. 13.6 and 13.7, the Assistant Secretary will determine whether an 
extraordinary protective need exists and whether the United States 
Secret Service Uniformed Division will be used for all, part or none of 
the protection. In making determinations, the Assistant Secretary may 
consult with appropriate Federal, State and local government agencies.

[45 FR 30621, May 9, 1980]



Sec. 13.5  Utilization of the services, personnel, equipment, and facilities of State and local governments.

    The Assistant Secretary may decide to utilize, on a reimbursable 
basis, the services, personnel, equipment, and facilities of State and 
local governments of the affected metropolitan area desiring to provide 
protection, or he may utilize the United States Secret Service Uniformed 
Division, or both. If the United States Secret Service Uniformed 
Division is utilized to meet all the extraordinary protective need, the 
governments of the affected metropolitan area will not be reimbursed. If 
the United States Secret Service Uniformed Division is utilized to meet 
part of the extraordinary protective needs, the governments of the 
affected metropolitan area will be reimbursed for that qualifying 
portion of the protection which is provided by State and local police 
authorities. If the Assistant Secretary decides to utilize, with their 
consent, the services, personnel, equipment, and facilities of such 
State and local governments to meet the extraordinary protective need, 
he will so

[[Page 221]]

notify the government as soon as possible after receipt of a request for 
protection or an advance notice of a reimbursement request made pursuant 
to Sec. 13.4.

[45 FR 30622, May 9, 1980]



Sec. 13.6  Reimbursement of State and local governments.

    (a) State and local governments providing services, personnel, 
equipment, or facilities to the affected metropolitan area pursuant to 
Sec. 13.5 may forward to the Assistant Secretary a bill for 
reimbursement for the personel, equipment, facilities, and services 
utilized in meeting the extraordinary protective need. The bill shall be 
in accordance with the format in Appendix II of this part. The Assistant 
Secretary will reimburse only those costs directly related to the 
extraordinary protective need including personnel and equipment costs 
resulting from assignments made to assist in providing security at an 
otherwise qualified location in connection with the arrival, departure, 
or during the visit of a foreign dignitary. Reimbursable costs will also 
include the costs for establishing both fixed posts at a qualified 
location and protective perimeters outside of a qualified location when 
it is clearly established to the satisfaction of the Assistant Secretary 
that such assignments were necessary to assure the safety of the 
qualified location. Overhead and administrative costs associated with an 
extraordinary protective need are reimbursable as either a flat 18 
percent of the total extraordinary protective need costs, or, if such 
costs can be clearly segregated from routine police costs, on a dollar-
for-dollar basis. The jurisdiction seeking such reimbursement may select 
either method but may not use both. For the purposes of reimbursement 
the Assistant Secretary will, in all cases, determine when the 
extraordinary protective need began and terminated.

[45 FR 30622, May 9, 1980]



Sec. 13.7  Reimbursement when the Assistant Secretary makes no determination to utilize State and local government services, personnel, equipment and 
          facilities.

    (a) Where events require the State or local governments of the 
affected metropolitan area to provide protection to meet an 
extraordinary protective need otherwise qualifying for reimbursement, 
such reimbursement may be made even if the provisions of Secs. 13.4 and 
13.5 have not been complied with fully. In such circumstances the 
provisions of Sec. 13.6 shall apply.
    (b) In cases where State or local governments, or both, utilized 
their own services, personnel, equipment, and facilities to provide 
protection for an extraordinary protective need, and no request for 
protective assistance pursuant to Sec.  13.4 was made because the 
extraordinary protective need occurred prior to the promulgation of this 
part but after July 1, 1974, an application by such government to the 
Assistant Secretary for reimbursement otherwise conforming to the 
requirements of this part will be considered.

[41 FR 55179, Dec. 17, 1976, as amended at 45 FR 30622, May 9, 1980]



Sec. 13.8  Protection for motorcades and other places associated with a visit qualifying under section 202(7) of Title 3, U.S. Code.

    (a) State and local governments furnishing services, personnel, 
equipment, and facilities to provide protection for motorcades and at 
other places associated with a visit qualifying under section 202(7) of 
Title 3, U.S. Code may forward to the Assistant Secretary a bill for 
reimbursement for the personnel, equipment, facilities, and services 
utilized in providing such protection.
    (b) Requests for payments under this section shall conform to the 
procedures established elsewhere in this part governing reimbursements 
arising out of an extraordinary protective need.

[45 FR 30622, May 9, 1980]

[[Page 222]]

 Appendix I (F) to Part 13--Estimated Overhead and Administrative Costs

Date:___________________________________________________________________

                         Select Only One Method

    ------ 1. Reimbursement for overhead and administrative costs will 
be requested as a flat 18 percent of the total extraordinary protective 
need cost as provided in section 13.6 of these regulations.
    ------ 2. Reimbursement for overhead and administrative costs will 
be requested on a dollar-for-dollar basis. Computation of these costs 
will be made using the below described method:

(Explain in detail how all of these costs can be directly and 
exclusively attributed to the extraordinary protective need.)

[45 FR 30622, May 9, 1980]

      Appendix II (F) to Part 13--Overhead and Administrative Costs

Date:___________________________________________________________________

                         Select Only One Method

    ------ 1. Reimbursement for overhead and administrative costs is 
requested as a flat 18 percent of the total extraordinary protective 
need costs as provided in section 13.6 of these regulations.
    ------ 2. Reimbursement for overhead and administrative costs is 
requested on a dollar-for-dollar basis. Computation of these costs has 
been made using the below described method:

(Explain and show in detail how all of these costs have been directly 
and exclusively attributed extraordinary protective need costs).

Dated:__________________________________________________________________

[45 FR 30622, May 9, 1980]

          Appendix I to Part 13--Form of Request for Assistance

    I hereby request assistance from the Department of the Treasury 
pursuant to Section 202 of Title 3, U.S. Code, as amended by Pub. L. 94-
196. This assistance is needed to enable the affected metropolitan area 
of ------------ to meet an extraordinary protective need, which is 
expected to arise on ------------ (date).
    The nature of the extraordinary protective need prompting this 
request is as follows:
    (If in association with a visit, include the name and title of the 
visiting foreign official or dignitary, the country represented and the 
name and location of the international organization involved and/or 
mission to be visited. The temporary domicile of the visiting official 
or dignitary and his schedule, including dates and times of arrival and 
departure from the United States, if available, must also be included. 
If the extraordinary protective need occurs at or, pursuant to Sec. 13.6 
of 31 CFR part 13, in the vicinity of, a permanent mission to an 
international organization of which the United States is a member or at 
an observer mission invited to participate in the work of the 
organization, the application shall include the name and location of the 
mission. If the extraordinary protective need occurs at a foreign 
diplomatic mission, including a consular office, in conjunction with a 
qualifying visit by a foreign official or dignitary of the same country 
as that mission, the application shall include the name and location of 
the mission or office. If, pursuant to Sec. 13.8, the visiting foreign 
official is to travel by motorcade and/or visit locations other than his 
foreign mission or temporary domicile, the application shall include a 
description of the anticipated motorcade routes and all stops on the 
routes as well as the name (or description) and location of any other 
places to be visited.
    The ------------ (Government entity) ------------ (is or is not) --
---------- prepared to provide ------------ (all or a portion of) the 
protection required to meet this need. Attached is an estimate of the 
appropriate number of personnel, by grade and rank, and the specific 
services, equipment and facilities which will be required to meet this 
extraordinary protective need, along with an estimate of the cost of 
such personnel, services, equipment, and facilities.
(Date)__________________________________________________________________
_______________________________________________________________________
(State or local government of the affected metropolitan area)
_______________________________________________________________________
(Signature)
_______________________________________________________________________
(Title)

[45 FR 30622, May 9, 1980]

         Appendix II to Part 13--Form of Bill for Reimbursement

    I hereby request that ------------ (Governmental entity) be 
reimbursed by the Department of the Treasury pursuant to sections 202 
and 208 of Title 3, U.S. Code, as amended and added, respectively, by 
Public Law 94-196 (89 Stat. 1109) (and/or pursuant to Public Law 96-74) 
for expenses incurred while providing an adequate level of protection 
during the extraordinary protective need arising in association with a 
visit of ------------ (Official or dignitary's name and title) of ------
------ (Country) to participate in the work of ------------ 
(International Organization) or occurring at the -------------- 
(Permanent or observer mission) to ------------ (International 
organization) during the period ------------ (Date) through ------------ 
(Date).

[[Page 223]]

    I certify that the level of protection provided was both reasonable 
and necessary; that the costs herein billed are only those direct costs 
associated with meeting the extraordinary protective need; and that the 
costs herein billed are not costs of an indirect nature such as 
administrative costs, overhead, and depreciation, except as provided in 
Sec. 13.6(a) of 31 CFR 13.
    Access to all records, accounts, receipts, etc., pertaining to the 
costs herein billed will be accorded to representatives of the Assistant 
Secretary (Enforcement and Operations) and the General Accounting Office 
at such reasonable times and places as may be mutually agreed upon by 
said representatives and ------------ (Governmental entity).
Date:___________________________________________________________________
_______________________________________________________________________
(Signature)
_______________________________________________________________________
(Title)

[45 FR 30623, May 9, 1980]



PART 14--RIGHT TO FINANCIAL PRIVACY ACT--Table of Contents




Sec.
14.1  Definitions.
14.2  Purpose.
14.3  Authorization.
14.4  Contents of request.
14.5  Certification.

    Authority: Sec. 1108, Right to Financial Privacy Act of 1978, 92 
Stat. 3697 et seq., 12 U.S.C. 3401 et seq.; (5 U.S.C. 301); and 
Reorganization Plan No. 26 of 1950.

    Source: 44 FR 16909, Mar. 20, 1979, unless otherwise noted.



Sec. 14.1  Definitions.

    For purposes of this regulation, the term:
    (a) Financial institution means any office of a bank, savings bank, 
card issuer as defined in section 103 of the Consumer Credit Protection 
Act (15 U.S.C. 1602(n)), industrial loan company, trust company, savings 
and loan, building and loan, or homestead association (including 
cooperative bank), credit union, or consumer financial institution, 
located in any State or territory of the United States, the District of 
Columbia, Puerto Rico, Guam, American Samoa, or the Virgin Islands.
    (b) Financial record means an original of, a copy of, or information 
known to have been derived from, any record held by a financial 
institution pertaining to a customer's relationship with the financial 
institution.
    (c) Person means an individual or a partnership of five or fewer 
individuals.
    (d) Customer means any person or authorized representative of that 
person who utilized or is utilizing any service of a financial 
institution, or for whom a financial institution is acting or has acted 
as a fiduciary, in relation to an account maintained in the person's 
name.
    (e) Law enforcement inquiry means a lawful investigation or official 
proceeding inquiring into a violation of or failure to comply with any 
criminal or civil statute or any regulation, rule, or order issued 
pursuant thereto.
    (f) Departmental unit means those offices, divisions, bureaus, or 
other components of the Department of the treasury authorized to conduct 
law enforcement inquiries.
    (g) Act means the Right to Financial Privacy Act of 1978.



Sec. 14.2  Purpose.

    The purpose of these regulations is to authorize Departmental units 
to request financial records from a financial institution pursuant to 
the formal written request procedure authorized by section 1108 of the 
Act, and to set forth the conditions under which such requests may be 
made.



Sec. 14.3  Authorization.

    Departmental units are hereby authorized to request financial 
records of any customer from a financial institution pursuant to a 
formal written request under the Act only if:
    (a) No administrative summons or subpoena authority reasonably 
appears to be available to the Departmental unit to obtain financial 
records for the purpose for which the records are sought;
    (b) There is reason to believe that the records sought are relevant 
to a legitimate law enforcement inquiry and will further that inquiry;
    (c) The request is issued by a supervisory official of a rank 
designated by the head of the requesting Departmental unit. Officials so 
designated shall not delegate this authority to others;

[[Page 224]]

    (d) The request adheres to the requirements set forth in Sec. 14.4; 
and
    (e) The notice requirements set forth in section 1108(4) of the Act, 
or the requirements pertaining to delay of notice in section 1109 of the 
Act are satisfied, except in situations where no notice is required. 
(e.g., section 1113(g))



Sec. 14.4  Contents of request.

    The formal written request shall be in the form of a letter or 
memorandum to an appropriate official of the financial institution from 
which financial records are requested. The request shall be signed by an 
issuing official of the requesting Department unit. It shall set forth 
that official's name, title, business address and business phone number. 
The request shall also contain the following:
    (a) The identity of the customer or customers to whom the records 
pertain;
    (b) A reasonable description of the records sought;
    (c) Any other information that the issuing official deems 
appropriate, e.g., the date on which the requesting Departmental unit 
expects to present a certificate of compliance with the applicable 
provisions of the Act, the name and title of the individual to whom 
disclosure is to be made, etc.

In cases where customer notice is delayed by a court order, a copy of 
the court order shall be attached to the formal written request.



Sec. 14.5  Certification.

    Prior to obtaining the requested records pursuant to a formal 
written request, an official of a rank designated by the head of the 
requesting Departmental unit shall certify in writing to the financial 
institution that the Departmental unit has complied with the applicable 
provisions of the Act.



PART 15--POST EMPLOYMENT CONFLICT OF INTEREST--Table of Contents




                      Subpart A--General Provisions

Sec.
15.737-1  Scope.
15.737-2  Definitions.
15.737-3  Director of Practice.
15.737-4  Other discipline.
15.737-5  Records.

Subpart B--Rules Applicable to Post Employment Practice by Officers and 
                       Employees of the Department

15.737-6  Interpretative standards.

            Subpart C--Administrative Enforcement Proceedings

15.737-7  Authority to prohibit practice.
15.737-8  Special orders.
15.737-9  Receipt of information concerning former Treasury employee.
15.737-10  Conferences.
15.737-11  Institution of proceeding.
15.737-12  Contents of complaint.
15.737-13  Service of complaint and other papers.
15.737-14  Answer.
15.737-15  Reply to answer.
15.737-16  Proof; variance; amendment of pleadings.
15.737-17  Motions and requests.
15.737-18  Representation.
15.737-19  Administrative Law Judge.
15.737-20  Hearings.
15.737-21  Evidence.
15.737-22  Depositions.
15.737-23  Transcript.
15.737-24  Proposed findings and conclusions.
15.737-25  Decision of the Administrative Law Judge.
15.737-26  Appeal to the General Counsel.
15.737-27  Decision of the General Counsel.
15.737-28  Notice of disciplinary action.

                Subpart D--Other Departmental Proceedings

15.737-29  Review by the General Counsel.

    Authority: 92 Stat. 1864 (18 U.S.C. 207), as amended.

    Source: 45 FR 39842, June 12, 1980, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 15.737-1  Scope.

    This part contains rules governing discipline of a former officer or 
employee of the Department of the Treasury because of a post employment 
conflict of interest. Such discipline may include prohibition from 
practice before the Department or a separate statutory agency thereof as 
those terms are defined in this part.

[[Page 225]]



Sec. 15.737-2  Definitions.

    For the purpose of this part--(a) The term Department means the 
Department of the Treasury and includes the separate statutory agencies 
thereof.
    (b) The term Director means the Director of Practice.
    (c) The term General Counsel means the General Counsel of the 
Department.
    (d) The term practice means any informal or formal appearance 
before, or, with the intent to influence, any oral or written 
communication to the Department or, where applicable, to a separate 
statutory agency thereof on a pending matter of business on behalf of 
any other person (except the United States).
    (e) The term separate statutory agency thereof means an agency or 
bureau within the Department designated by rule by the Director, Office 
of Government Ethics, as a separate agency or bureau. The Internal 
Revenue Service, Bureau of Alcohol, Tobacco and Firearms, United States 
Secret Service, Bureau of the Mint, United States Customs Service, 
Bureau of Engraving and Printing, and Comptroller of the Currency were 
so designated effective July 1, 1979.



Sec. 15.737-3  Director of Practice.

    There is, in the Office of the Secretary of the Treasury, the Office 
of Director of Practice. The Director shall institute and provide for 
the conduct of disciplinary proceedings involving former employees of 
the Department as authorized by 18 U.S.C. 207(j), and perform such other 
duties as are necessary or appropriate to carry out his/her functions 
under this part.



Sec. 15.737-4  Other discipline.

    For activity alleged to violate 18 U.S.C. 207 (a), (b) or (c), the 
Director may also bring a disciplinary proceeding pursuant to the 
regulations governing practice before the Bureau of Alcohol, Tobacco and 
Firearms or the Internal Revenue Service as found in 31 CFR part 8 and 
31 CFR part 10, respectively. Such proceeding may be consolidated with 
any proceeding brought pursuant to this part.



Sec. 15.737-5  Records.

    There are made available to public inspection at the Office of 
Director of Practice the roster of all persons prohibited from practice 
before the Department. Other records may be disclosed upon specific 
request, in accordance with appropriate disclosure regulations of the 
Department.



Subpart B--Rules Applicable to Post Employment Practice by Officers and 
                       Employees of the Department



Sec. 15.737-6  Interpretative standards.

    A determination that a former officer or employee of the Department 
violated 18 U.S.C. 207 (a), (b) or (c) will be made in conformance with 
the standards established in the interpretative regulations promulgated 
by the Office of Government Ethics and published at 5 CFR part 737.



            Subpart C--Administrative Enforcement Proceedings



Sec. 15.737-7  Authority to prohibit practice.

    Pursuant to 18 U.S.C. 207(j), if the General Counsel finds, after 
notice and opportunity for a hearing, that a former officer or employee 
of the Department violated 18 U.S.C. 207 (a), (b) or (c), the General 
Counsel in his/her discretion may prohibit that person from engaging in 
practice before the Department or a separate statutory agency thereof 
for a period not to exceed five years, or may take other appropriate 
disciplinary action.



Sec. 15.737-8  Special orders.

    The General Counsel may issue special orders as he/she may consider 
proper in any case within the purview of this part.



Sec. 15.737-9  Receipt of information concerning former Treasury employee.

    If an officer or employee of the Department has reason to believe 
that a former officer or employee of the Department has violated 18 
U.S.C. 207 (a), (b) or (c), or if any such officer or employee receives 
information to that effect, he/she shall promptly make a

[[Page 226]]

written report thereof, which report or a copy thereof shall be 
forwarded to the Inspector General, Department of the Treasury. If any 
other person has information of such violations, he/she may make a 
report thereof to the Inspector General or to any officer or employee of 
the Department. The Inspector General shall refer any information he/she 
deems warranted to the Director.



Sec. 15.737-10  Conferences.

    (a) In general. The Director may confer with a former officer or 
employee concerning allegations of misconduct irrespective of whether an 
administrative disciplinary proceeding has been instituted against him/
her. If such conference results in a stipulation in connection with a 
proceeding in which such person is the respondent, the stipulation may 
be entered in the record at the instance of either party to the 
proceeding.
    (b) Voluntary suspension. A former officer or employee, in order to 
avoid the institution or conclusion of a proceeding, may offer his/her 
consent to suspension from practice before the Department or a separate 
statutory agency thereof. The Director in his/her discretion, may 
suspend a former officer or employee in accordance with the consent 
offered.



Sec. 15.737-11  Institution of proceeding.

    (a) Whenever the Director has reason to believe that any former 
officer or employee of the Department has violated 18 U.S.C. 207 (a), 
(b) or (c), he/she may reprimand such person or institute an 
administrative disciplinary proceeding for that person's suspension from 
practice before the Department or a separate statutory agency thereof. 
The proceeding shall be instituted by a complaint which names the 
respondent and is signed by the Director and filed in his/her office. 
Except in cases of willfulness, or where time, the nature of the 
proceeding, or the public interest does not permit, a proceeding will 
not be instituted under this section until facts or conduct which may 
warrant such action have been called to the attention of the proposed 
respondent in writing and he/she has been accorded the opportunity to 
provide his/her position on the matter.
    (b) The Director shall coordinate proceedings under this part with 
the Department of Justice in cases where it initiates criminal 
prosecution.



Sec. 15.737-12  Contents of complaint.

    (a) Charges. A complaint shall give a plain and concise description 
of the allegations which constitute the basis for the proceeding. A 
complaint shall be deemed sufficient if it fairly informs the respondent 
of the charges against him/her so that the respondent is able to prepare 
a defense.
    (b) Demand for answer. In the complaint, or in a separate paper 
attached to the complaint, notification shall be given of the place and 
time within which the respondent shall file his/her answer, which time 
shall not be less than 15 days from the date of service of the 
complaint, and notice shall be given that a decision by default may be 
rendered against the respondent in the event he/she fails to file an 
answer as required.



Sec. 15.737-13  Service of complaint and other papers.

    (a) Complaint. The complaint or a copy thereof may be served upon 
the respondent by certified mail, or first-class mail as hereinafter 
provided; by delivering it to the respondent or his/her attorney or 
agent of record either in person or by leaving it at the office or place 
of business of the respondent, attorney or agent; or in any other manner 
which has been agreed to by the respondent. Where the service is by 
certified mail, the return post office receipt duly signed by or on 
behalf of the respondent shall be proof of service. If the certified 
mail is not claimed or accepted by the respondent and is returned 
undelivered, complete service may be made upon the respondent by mailing 
the complaint to him/her by first-class mail, addressed to him/her at 
the last address known to the Director. If service is made upon the 
respondent or his/her attorney or agent of record in person or by 
leaving the complaint at the office or place of business of the 
respondent, attorney or agent, the verified return by the person

[[Page 227]]

making service, setting forth the manner of service, shall be proof of 
such service.
    (b) Service of papers other than complaint. Any paper other than the 
complaint may be served upon a respondent as provided in paragraph (a) 
of this section or by mailing the paper by first-class mail to the 
respondent at the last address known to the Director, or by mailing the 
paper by first-class mail to the respondent's attorney or agent of 
record. Such mailing shall constitute complete service. Notices may be 
served upon the respondent or his/her attorney or agent of record by 
telegraph.
    (c) Filing of papers. Whenever the filing of a paper is required or 
permitted in connection with a proceeding, and the place of filing is 
not specified by this subpart or by rule or order of the Administrative 
Law Judge, the paper shall be filed with the Director of Practice, 
Department of the Treasury, Washington, DC 20220. All papers shall be 
filed in duplicate.



Sec. 15.737-14  Answer.

    (a) Filing. The respondent's answer shall be filed in writing within 
the time specified in the complaint, unless on application the time is 
extended by the Director or the Administrative Law Judge. The answer 
shall be filed in duplicate with the Director.
    (b) Contents. The answer shall contain a statement of facts which 
constitute the grounds of defense, and it shall specifically admit or 
deny each allegation set forth in the complaint, except that the 
respondent shall not deny a material allegation in the complaint which 
he/she knows to be true, or state that he/she is without sufficient 
information to form a belief when in fact he/she possesses such 
information. The respondent may also state affirmatively special matters 
of defense.
    (c) Failure to deny or answer allegations in the complaint. Every 
allegation in the complaint which is not denied in the answer shall be 
deemed to be admitted and may be considered as proved, and no further 
evidence in respect of such allegation need be adduced at a hearing. 
Failure to file an answer within the time prescribed in the notice to 
the respondent, except as the time for answer is extended by the 
Director or the Administrative Law Judge, shall constitute an admission 
of the allegations of the complaint and a waiver of hearing, and the 
Administrative Law Judge may make his/her decision by default without a 
hearing or further procedure.



Sec. 15.737-15  Reply to answer.

    No reply to the respondent's answer shall be required, and new 
matter in the answer shall be deemed to be denied, but the Director may 
file a reply in his/her discretion or at the request of the 
Administrative Law Judge.



Sec. 15.737-16  Proof; variance; amendment of pleadings.

    In the case of a variance between the allegations in a pleading and 
the evidence adduced in support of the pleading, the Administrative Law 
Judge may order or authorize amendment of the pleading to conform to the 
evidence: Provided, That the party who would otherwise be prejudiced by 
the amendment is given reasonable opportunity to meet the allegations of 
the pleading as amended; and the Administrative Law Judge shall make 
findings on any issue presented by the pleadings as so amended.



Sec. 15.737-17  Motions and requests.

    Motions and requests may be filed with the Director or with the 
Administrative Law Judge.



Sec. 15.737-18  Representation.

    A respondent or proposed respondent may appear in person or he/she 
may be represented by counsel or other representative. The Director may 
be represented by an attorney or other employee of the Department.



Sec. 15.737-19  Administrative Law Judge.

    (a) Appointment. An Administrative Law Judge appointed as provided 
by 5 U.S.C. 3105 (1966), shall conduct proceedings upon complaints for 
the administrative disciplinary proceedings under this part.
    (b) Power of Administrative Law Judge. Among other powers, the 
Administrative Law Judge shall have authority, in

[[Page 228]]

connection with any proceeding assigned or referred to him/her, to do 
the following:
    (1) Administer oaths and affirmations;
    (2) Make rulings upon motions and requests, which rulings may not be 
appealed from prior to the close of a hearing except, at the discretion 
of the Administrative Law Judge, in extraordinary circumstances;
    (3) Determine the time and place of hearing and regulate its course 
and conduct;
    (4) Adopt rules of procedure and modify the same from time to time 
as occasion requires for the orderly disposition of proceedings;
    (5) Rule upon offers of proof, receive relevant evidence, and 
examine witnesses;
    (6) Take or authorize the taking of depositions;
    (7) Receive and consider oral or written argument on facts or law;
    (8) Hold or provide for the holding of conferences for the 
settlement or simplification of the issues by consent of the parties;
    (9) Assess the responsible party extraordinary costs attributable to 
the location of a hearing;
    (10) Perform such acts and take such measures as are necessary or 
appropriate to the efficient conduct of any proceeding; and
    (11) Make initial decisions.



Sec. 15.737-20  Hearings.

    (a) In general. The Administrative Law Judge shall preside at the 
hearing on a complaint for the suspension of a former officer or 
employee from practice before the Department. Hearings shall be 
stenographically recorded and transcribed and the testimony of witnesses 
shall be taken under oath or affirmation. Hearings will be conducted 
pursuant to 5 U.S.C. 556.
    (b) Public access to hearings. Hearings will be closed unless an 
open hearing is requested by the respondent, except that if classified 
information or protected information of third parties (such as tax 
information) is likely to be adduced at the hearing, it will remain 
closed. A request for an open hearing must be included in the answer to 
be considered.
    (c) Failure to appear. If either party to the proceeding fails to 
appear at the hearing, after due notice thereof has been sent to him/
her, he/she shall be deemed to have waived the right to a hearing and 
the Administrative Law Judge may make a decision against the absent 
party by default.



Sec. 15.737-21  Evidence.

    (a) In general. The rules of evidence prevailing in courts of law 
and equity are not controlling in hearings on complaints for the 
suspension of a former officer or employee from practice before the 
Department. However, the Administrative Law Judge shall exclude evidence 
which is irrelevant, immaterial, or unduly repetitious.
    (b) Depositions. The deposition of any witness taken pursuant to 
Sec. 15.737-22 of this part may be admitted.
    (c) Proof of documents. Official documents, records and papers of 
the Department shall be admissible in evidence without the production of 
an officer or employee to authenticate them. Any such documents, 
records, and papers may be evidenced by a copy attested or identified by 
an officer or employee of the Department.
    (d) Exhibits. If any document, record, or other paper is introduced 
in evidence as an exhibit, the Administrative Law Judge may authorize 
the withdrawal of the exhibit subject to any conditions which he/she 
deems proper.
    (e) Objections. Objections to evidence shall be in short form, 
stating the grounds of objection relied upon, and the record shall not 
include argument thereon, except as ordered by the Administrative Law 
Judge. Rulings on such objections shall be a part of the record. No 
exception to the ruling is necessary to preserve the rights of the 
parties.



Sec. 15.737-22  Depositions.

    Depositions for use at a hearing may, with the consent of the 
parties in writing or the written approval of the Administrative Law 
Judge, be taken by either the Director or the respondent or their duly 
authorized representatives. Depositions may be taken upon oral or 
written interrogatories, upon not less than 10 days' written notice to 
the other party before any officer duly

[[Page 229]]

authorized to administer an oath for general purposes or before an 
officer or employee of the Department who is authorized to administer an 
oath. Such notice shall state the names of the witnesses and the time 
and place where the depositions are to be taken. The requirement of 10 
days' notice may be waived by the parties in writing, and depositions 
may then be taken from the persons and at the times and places mutually 
agreed to by the parties. When a deposition is taken upon written 
interrogatories, any cross-examination shall be upon written 
interrogatories. Copies of such written interrogatories shall be served 
upon the other party with the notice, and copies of any written cross-
interrogation shall be mailed or delivered to the opposing party at 
least 5 days before the date of taking the depositions, unless the 
parties mutually agree otherwise. A party upon whose behalf a deposition 
is taken must file it with the Administrative Law Judge and serve one 
copy upon the opposing party. Expenses in the reporting of depositions 
shall be borne by the party at whose instance the deposition is taken.



Sec. 15.737-23  Transcript.

    In cases where the hearing is stenographically reported by a 
Government contract reporter, copies of the transcript may be obtained 
from the reporter at rates not to exceed the maximum rates fixed by 
contract between the Government and the reporter or from the Department 
at actual cost of duplication. Where the hearing is stenographically 
reported by a regular employee of the Department, a copy thereof will be 
supplied to the respondent either without charge or upon payment of a 
reasonable fee. Copies of exhibits introducted at the hearing or at the 
taking of depositions will be supplied to the parties upon the payment 
of a reasonable fee (Sec. 501, Pub. L. 82-137, 65 Stat. 290 (31 U.S.C. 
483a)).



Sec. 15.737-24  Proposed findings and conclusions.

    Except in cases where the respondent has failed to answer the 
complaint or where a party has failed to appear at the hearing, the 
Administrative Law Judge prior to making his/her decision, shall afford 
the parties a reasonable opportunity to submit proposed findings and 
conclusions and supporting reasons therefor.



Sec. 15.737-25  Decision of the Administrative Law Judge.

    As soon as practicable after the conclusion of a hearing and the 
receipt of any proposed findings and conclusions timely submitted by the 
parties, the Administrative Law Judge shall make the initial decision in 
the case. The decision shall include (a) a statement of findings and 
conclusions, as well as the reasons or basis therefor, upon all the 
material issues of fact, law, or discretion presented on the record, and 
(b) an order of suspension from practice before the Department or 
separate statutory agency thereof or other appropriate disciplinary 
action, or an order of dismissal of the complaint. The Administrative 
Law Judge shall file the decision with the Director and shall transmit a 
copy thereof to the respondent or his/her attorney of record. In the 
absence of an appeal to the General Counsel or review of the decision 
upon motion of the General Counsel, the decision of the Administrative 
Law Judge shall without further proceedings become the decision of the 
General Counsel 30 days from the date of the Administrative Law Judge's 
decision.



Sec. 15.737-26  Appeal to the General Counsel.

    Within 30 days from the date of the Administrative Law Judge's 
decision, either party may appeal to the General Counsel. The appeal 
shall be filed with the Director in duplicate and shall include 
exceptions to the decision of the Administrative Law Judge and 
supporting reasons for such exceptions. If an appeal is filed by the 
Director, he/she shall transmit a copy thereof to the respondent. Within 
30 days after receipt of an appeal or copy thereof, the other party may 
file a reply brief in duplicate with the Director. If the reply brief is 
filed by the Director, he/she shall transmit a copy of it to the 
respondent. Upon the filing of an appeal and a reply brief, if any, the 
Director shall transmit the entire record to the General Counsel.

[[Page 230]]



Sec. 15.737-27  Decision of the General Counsel.

    On appeal from or review of the initial decision of the 
Administrative Law Judge, the General Counsel will make the agency 
decision. In making his/her decision, the General Counsel will review 
the record or such portions thereof as may be cited by the parties to 
permit limiting of the issues. A copy of the General Counsel's decision 
shall be transmitted to the respondent by the Director.



Sec. 15.737-28  Notice of disciplinary action.

    (a) Upon the issuance of a final order suspending a former officer 
or employee from practice before the Department or a separate statutory 
agency thereof, the Director shall give notice thereof to appropriate 
officers and employees of the Department. Officers and employees of the 
Department shall refuse to participate in any appearance by such former 
officer or employee or to accept any communication which constitutes the 
prohibited practice before the Department or separate statutory agency 
thereof during the period of suspension.
    (b) The Director shall take other appropriate disciplinary action as 
may be required by the final order.



                Subpart D--Other Departmental Proceedings



Sec. 15.737-29  Review by the General Counsel.

    In my proceeding before the Department, if an initial decision is 
made with respect to the disqualification of a representative or 
attorney for a party on the grounds of 18 U.S.C. 207(a), (b) or (c), 
such decision may be appealed to the General Counsel, who will make the 
agency decision on the issue.



PART 16--REGULATIONS IMPLEMENTING THE PROGRAM FRAUD CIVIL REMEDIES ACT OF 1986--Table of Contents




Sec.
16.1  Basis and purpose.
16.2  Definitions.
16.3  Basis for civil penalties and assessments.
16.4  Investigation.
16.5  Review by the reviewing official.
16.6  Prerequisites for issuing a complaint.
16.7  Complaint.
16.8  Service of complaint.
16.9  Answer.
16.10  Default upon failure to file an answer.
16.11  Referral of complaint and answer to the ALJ.
16.12  Notice of hearing.
16.13  Parties to the hearing.
16.14  Separation of functions.
16.15  Ex parte contacts.
16.16  Disqualification of reviewing official or ALJ.
16.17  Rights of parties.
16.18  Authority of the ALJ.
16.19  Prehearing conferences.
16.20  Disclosure of documents.
16.21  Discovery.
16.22  Exchange of witness lists, statements, and exhibits.
16.23  Subpoenas for attendance at hearing.
16.24  Protective order.
16.25  Fees.
16.26  Form, filing and service of papers.
16.27  Computation of time.
16.28  Motions.
16.29  Sanctions.
16.30  The hearing and burden of proof.
16.31  Determining the amount of penalties and assessments.
16.32  Location of hearing.
16.33  Witnesses.
16.34  Evidence.
16.35  The record.
16.36  Post-hearing briefs.
16.37  Initial decision.
16.38  Reconsideration of initial decision.
16.39  Appeal to authority head.
16.40  Stays ordered by the Department of Justice.
16.41  Stay pending appeal.
16.42  Judicial review.
16.43  Collection of civil penalties and assessments.
16.44  Right to administrative offset.
16.45  Deposit in Treasury of United States.
16.46  Compromise or settlement.
16.47  Limitations.

    Authority: 31 U.S.C. 3801-3812.

    Source: 52 FR 35071, Sept. 17, 1987, unless otherwise noted.



Sec. 16.1  Basis and purpose.

    (a) Basis. This part implements the Program Fraud Civil Remedies Act 
of 1986, Pub. L. 99-509, sections 6101-6104, 100 Stat. 1874 (October 21, 
1986), to be codified at 31 U.S.C. 3801-3812. 31 U.S.C. 3809 requires 
each authority head to promulgate regulations necessary to implement the 
provisions of the statute.
    (b) Purpose. This part

[[Page 231]]

    (1) Establishes administrative procedures for imposing civil 
penalties and assessments against persons who make, submit, or present, 
or cause to be made, submitted, or presented, false, fictitious, or 
fraudulent claims or written statements to authorities or to their 
agents, and
    (2) Specifies the hearing and appeal rights of persons subject to 
allegations of liability for such penalties and assessments.



Sec. 16.2  Definitions.

    ALJ means an Administrative Law Judge in the authority appointed 
pursuant to 5 U.S.C. 3105 or detailed to the authority pursuant to 5 
U.S.C. 3344.
    Authority means the Department of the Treasury.
    Authority head means the Assistant Secretary of the Treasury for 
Management.
    Benefit, when used in the context of false statements made with 
respect to a benefit, means anything of value including but not limited 
to any advantage, preference, privilege, license, permit, favorable 
decision, ruling, status, or loan guarantee. This definition should be 
distinguished from the limitations on coverage of these regulations with 
respect to beneficiaries of specific benefit programs which are found in 
Sec. 16.3(c) of this part.
    Claim means any request, demand, or submission--
    (a) Made to the authority for property, services, or money 
(including money representing grants, loans, insurance, or benefits);
    (b) Made to a recipient of property, services, or money from the 
authority or to a party to a contract with the authority--
    (1) For property or services if the United States--
    (i) Provided such property or services;
    (ii) Provided any portion of the funds for the purchase of such 
property or services; or
    (iii) Will reimburse such recipient or party for the purchase of 
such property or services; or
    (2) For the payment of money (including money representing grants, 
loans, insurance, or benefits) if the United States--
    (i) Provided any portion of the money requested or demanded; or
    (ii) Will reimburse such recipient or party for any portion of the 
money paid on such request or demand; or
    (c) Made to the authority which has the effect of decreasing an 
obligation to pay or account for property, services, or money, except 
that such term does not include any claim made in any return of tax 
imposed by the Internal Revenue Code of 1954.
    Complaint means the administrative complaint served by the reviewing 
official on the defendant under Sec. 16.7 of this part.
    Defendant means any person alleged in a complaint under Sec. 16.7 to 
be liable for a civil penalty or assessment under Sec. 16.3.
    Department means the Department of the Treasury.
    Government means the United States Government.
    Individual means a natural person.
    Initial decision means the written decision of the ALJ required by 
Sec. 16.10 or Sec. 16.37, and includes a revised initial decision issued 
following a remand or a motion for reconsideration.
    Investigating official means the Inspector General of the Department 
of the Treasury.
    Knows or has reason to know, means that a person, with respect to a 
claim or statement--
    (a) Has actual knowledge that the claim or statement is false, 
fictitious, or fraudulent;
    (b) Acts in deliberate ignorance of the truth or falsity of the 
claim or statement; or
    (c) Acts in reckless disregard of the truth or falsity of the claim 
or statement.
    Makes, wherever it appears, shall include the terms ``presents,'' 
``submits,'' and ``causes to be made, presented,'' or ``submitted.'' As 
the context requires, making or made, shall likewise include the 
corresponding forms of such terms.
    Person means any individual, partnership, corporation, association, 
private organization, State, political subdivision of a State, 
municipality, county, district, and Indian tribe, and includes the 
plural of that term.

[[Page 232]]

    Presiding officer means an administrative law judge appointed in the 
authority pursuant to 5 U.S.C. 3105 or detailed to the authority 
pursuant to section 3344 of such title.
    Representative means an attorney designated in writing by a 
defendant to appear on his or her behalf in administrative hearings 
before the Department and to represent a defendant in all other legal 
matters regarding a complaint made pursuant to these regulations.
    Reviewing official means the General Counsel, or another individual 
in the Legal Division of the Department designated by the General 
Counsel, who is--
    (a) Serving in a position for which the rate of basic pay is not 
less than the minimum rate of basic pay for grade GS-16; and
    (b) Is not subject to supervision by, or required to report to, the 
investigating official; and
    (c) Is not employed in the organization unit of the authority in 
which the investigating official is employed.
    Statement means any representation, certification, affirmation, 
document, record, or accounting or bookkeeping entry made--
    (a) With respect to a claim or to obtain the approval or payment of 
a claim (including relating to eligibility to make a claim); or
    (b) With respect to (including relating to eligibility for)--
    (1) A contract with, or a bid or proposal for a contract with; or
    (2) A grant, loan, or benefit from, the authority, or any State, 
political subdivision of a State, or other party, if the United States 
Government provides any portion of the money or property under such 
contract or for such grant, loan, or benefit, or if the government will 
reimburse such State, political subdivision, or party of any portion of 
the money or property under such contract or for such grant, loan, or 
benefit, except that such term does not include any claim made in any 
return of tax imposed by the Internal Revenue Code of 1954.



Sec. 16.3  Basis for civil penalties and assessments.

    (a) Claims. (1) Except as provided in paragraph (c) of this section, 
any person who makes a claim that the person knows or has reason to 
know--
    (i) Is false, fictitious, or fraudulent;
    (ii) Includes or is supported by any written statement which asserts 
a material fact which is false, fictitious, or fraudulent;
    (iii) Includes or is supported by any written statement that--
    (A) Omits a material fact;
    (B) Is false, fictitious, or fraudulent as a result of such 
omission; and
    (C) Is a statement in which the person making such statement has a 
duty to include such material fact; or
    (iv) Is for payment for the provision of property or services which 
the person has not provided as claimed, shall be subject, in addition to 
any other remedy that may be prescribed by law, to a civil penalty of 
not more than $5,000 for each such claim.
    (2) Each voucher, invoice, claim form, or other individual request 
or demand for property, services, or money constitutes a separate claim.
    (3) A claim shall be considered made to an authority, recipient, or 
party when such claim is actually made to an agent, fiscal intermediary, 
or other entity, including any State or political subdivision thereof, 
acting for or on behalf of such authority, recipient, or party.
    (4) Each claim for property, services, or money is subject to a 
civil penalty under these regulations regardless of whether such 
property, services, or money is actually delivered or paid.
    (5) If the government has made any payment (including transferred 
property or provided services) on a claim, a person subject to a civil 
penalty under paragraph (a)(1) of this section shall also be subject to 
an assessment of not more than twice the amount of such claim or that 
portion thereof that is determined to be in violation of paragraph 
(a)(1) of this section. Such assessment shall be in lieu of damages 
sustained by the Government because of such claim.
    (b) Statements. (1) Except as provided in paragraph (c) of this 
section, any

[[Page 233]]

person who makes a written statement that--
    (i) The person knows or has reason to know--
    (A) Asserts a material fact which is false, fictitious, or 
fraudulent; or
    (B) Is false, fictitious, or fraudulent because it omits a material 
fact that the person making the statement has a duty to include in such 
statement; and
    (ii) Includes or is accompanied by an express certification or 
affirmation of the truthfulness and accuracy of the content of the 
statement,

shall be subject, in addition to any other remedy that may be prescribed 
by law, to a civil penalty of not more than $5,000 for each such 
statement.
    (2) Each written representation, certification, or affirmation 
constitutes a separate statement.
    (3) A statement shall be considered made to an authority when such 
statement is actually made to an agent, fiscal intermediary, or other 
entity, including any State or political subdivision thereof, acting for 
or on behalf of such authority.
    (c)(1) In the case of any claim or statement made by any individual 
relating to any of the benefits listed in paragraph (c)(2) of this 
section, received by such individual, such individual may be held liable 
for penalties and assessments under this section only if such claim or 
statement is made by such individual in making application for such 
benefits with respect to such individual's eligibility to receive such 
benefits.
    (2) For purposes of this paragraph, the term benefits means--
    (i) Benefits under the food stamp program (as defined in section 
3(h) of the Food Stamp Act of 1977);
    (ii) Benefits under Chapters 11, 13, 15, 17, and 21 of Title 38;
    (iii) Benefits under the Black Lung Benefits Act;
    (iv) Any authority or other benefit under the Railroad Retirement 
Act of 1974;
    (v) Benefits under the National School Lunch Act;
    (vi) Benefits under any housing assistance program for lower income 
families or elderly or handicapped persons which is administered by the 
Secretary of Housing and Urban Development or the Secretary of 
Agriculture;
    (vii) Benefits under the special supplemental food program for 
women, infants, and children established under section 17 of the Child 
Nutrition Act of 1966;
    (viii) Benefits under part A of the Energy Conservation in Existing 
Buildings Act of 1976;
    (ix) Benefits under the supplemental security income program under 
title XVI of the Social Security Act;
    (x) Old age, survivors, and disability insurance benefits under 
title II of the Social Security Act;
    (xi) Benefits under title XVIII of the Social Security Act;
    (xii) Aid to families with dependent children under a State plan 
approved under section 402(a) of the Social Security Act;
    (xiii) Medical assistance under a State plan approved under section 
1902(a) of the Social Security Act;
    (xiv) Benefits under title XX of the Social Security Act;
    (xv) Benefits under section 336 of the Older Americans Act; or
    (xvi) Benefits under the Low-Income Home Energy Assistance Act of 
1981, which are intended for the personal use of the individual who 
receives the benefits or for a member of the individual's family.
    (d) No proof of specific intent to defraud is required to establish 
liability under this section.
    (e) In any case in which it is determined that more than one person 
is liable for making a claim or statement under this section, each such 
person may be held liable for a civil penalty under this section.
    (f) In any case in which it is determined that more than one person 
is liable for making a claim under this section, and on which the 
Government has made payment (including transferred property or provided 
services), an assessment may be imposed against any such person or 
jointly and severally against any combination of such persons.



Sec. 16.4  Investigation.

    (a) If an investigating official concludes that a subpoena pursuant 
to the

[[Page 234]]

authority conferred by 31 U.S.C. 3804(a) is warranted--
    (1) The subpoena so issued shall notify the person to whom it is 
addressed of the authority under which the subpoena is issued and shall 
identify the information, records, or documents sought;
    (2) The investigating official may designate a person to act on his 
behalf to receive the information, records, or documents sought; and
    (3) The person receiving such subpoena shall be required to tender 
to the investigating official or to the person designated to receive the 
information, records, or documents, a certification that the 
information, records, or documents sought have been produced, or that 
such information, records, or documents are not available and the 
reasons therefor, or that such information, records, or documents, 
suitably identified, have been withheld based upon the assertion of an 
identified legal privilege.
    (b) If the investigating official concludes that an action under the 
Program Fraud Civil Remedies Act may be warranted, the investigating 
official shall report the findings and conclusions of such investigation 
to the reviewing official.
    (c) Nothing in this section shall preclude or limit the 
investigating official's discretion to refer allegations directly to the 
Department of Justice for suit under the False Claims Act, 31 U.S.C. 
3729-3731, or for other civil relief, or to preclude or limit such 
official's discretion to defer or postpone a report or referral to avoid 
interference with an investigation into criminal misconduct or a 
criminal prosecution.
    (d) Nothing in this section modifies any responsibility of the 
investigating official to report violations of criminal law to the 
Attorney General.



Sec. 16.5  Review by the reviewing official.

    (a) If, based on the report of the investigating official under 
Sec. 16.4(b), the reviewing official determines that there is adequate 
evidence to believe that a person is liable under Sec. 16.3 of this 
part, the reviewing official shall transmit to the Attorney General a 
written notice of the reviewing official's intention to issue a 
complaint under Sec. 16.7.
    (b) Such notice shall include--
    (1) A statement of the reviewing official's reasons for issuing a 
complaint;
    (2) A statement specifying the evidence that supports the 
allegations of liability;
    (3) A description of the claims or statements upon which the 
allegations of liability are based;
    (4) An estimate of the amount of money or the value, if any, of 
property, services, or other benefits requested or demanded in violation 
of Sec. 16.3 of this part; or, if no monetary value can be put on the 
property, service or benefit, a statement regarding the non-monetary 
consequences to the agency of a false statement.
    (5) A statement of any exculpatory or mitigating circumstances that 
may relate to the claims or statements known by the reviewing official 
or the investigating official; and
    (6) A statement that there is a reasonable prospect of collecting an 
appropriate amount of penalties and assessments. Such a statement may be 
based upon information then known or an absence of any information 
indicating that the person may be unable to pay such an amount.



Sec. 16.6  Prerequisites for issuing a complaint.

    (a) The reviewing official may issue a complaint under Sec. 16.7 
only if--
    (1) The Department of Justice approves the issuance of a complaint 
in a written statement described in 31 U.S.C. 3803(b)(l), and
    (2) In the case of allegations of liability under Sec. 16.3(a) with 
respect to a claim, the reviewing official determines that, with respect 
to such claim or a group of related claims submitted at the same time 
such claim is submitted (as defined in paragraph (b) of this section), 
the amount of money or the value of property or services demanded or 
requested in violation of Sec. 16.3(a) does not exceed $150,000.
    (b) For the purposes of this section, a related group of claims 
submitted at the same time shall include only those claims arising from 
the same transaction (e.g., grant, loan, application, or

[[Page 235]]

contract) that are submitted simultaneously as part of a single request, 
demand, or submission.
    (c) Nothing in this section shall be construed to limit the 
reviewing official's authority to join in a single complaint against a 
person, claims that are unrelated or were not submitted simultaneously, 
regardless of the amount of money or the value of property or services 
demanded or requested, as long as the total amount for each claim does 
not exceed $150,000.



Sec. 16.7  Complaint.

    (a) On or after the date the Attorney General or his designee 
approves the issuance of a complaint in accordance with 31 U.S.C. 
3803(b)(1), the reviewing official may serve a complaint on the 
defendant, as provided in Sec. 16.8.
    (b) The complaint shall state--
    (1) The allegations of liability against the defendant, including 
the statutory basis for liability, an identification of the claims or 
statements that are the basis for the alleged liability, and the reasons 
why liability allegedly arises from such claims or statements;
    (2) The maximum amount of penalties and assessments for which the 
defendant may be held liable;
    (3) Instructions for filing an answer to request a hearing, 
including a specific statement of the defendant's right to request a 
hearing by filing an answer and to be represented by an attorney;
    (4) That the defendant has a right to review and obtain certain 
information pursuant to Section 16.20 herein; and
    (5) That failure to file an answer within 30 days of service of the 
complaint will result in the imposition of the maximum amount of 
penalties and assessments without right to appeal.
    (c) At the same time the reviewing official serves the complaint on 
the defendant(s), he or she shall serve the defendant with a copy of 
these regulations.



Sec. 16.8  Service of complaint.

    (a) Service of a complaint must be made by a certified or registered 
mail or by delivery in any manner authorized by Rule 4(d) of the Federal 
Rules of Civil Procedure.
    (b) Proof of service, stating the name and address of the person on 
whom the complaint was served, and the manner and date of service, may 
be made by--
    (1) Affidavit of the individual making service;
    (2) An acknowledged United States Postal Service return receipt 
card; or
    (3) Written acknowledgement of the defendant or his representative.



Sec. 16.9  Answer.

    (a) The defendant may request a hearing by filing an answer with the 
reviewing official within 30 days of service of the complaint. An answer 
shall be deemed to be a request for hearing.
    (b) In the answer, the defendant--
    (1) Shall admit or deny each of the allegations of liability made in 
the complaint;
    (2) Shall state any defense on which the defendant intends to rely;
    (3) May state any reasons why the defendant contends that the 
penalties and assessments should be less than the statutory maximum; and
    (4) Shall state whether the defendant has authorized an attorney to 
act as defendant's representative, and shall state the name, address, 
and telephone number of the representative.



Sec. 16.10  Default upon failure to file an answer.

    (a) If the defendant does not file an answer within the time 
prescribed in Sec. 16.9(a), the reviewing official may refer the 
complaint to the ALJ for initial decision.
    (b) Upon the referral of the complaint, the ALJ shall promptly serve 
on defendant in the manner prescribed in Sec. 16.8, a notice that an 
initial decision will be issued under this section.
    (c) If the defendant fails to file a timely answer, the ALJ shall 
assume the facts alleged in the complaint to be true and, if such facts 
eatablish liability under Sec. 16.3, the ALJ shall issue an initial 
decision imposing the maximum amount of penalties and assessments 
allowed under the statute.
    (d) Except as otherwise provided in this section, by failing to file 
a timely answer, the defendant waives any right to further review of the 
penalties and assessments imposed under paragraph

[[Page 236]]

(c) of this section, and the initial decision shall become final and 
binding upon the parties 30 days after it is issued.
    (e) If, before such an initial decision becomes final, the defendant 
files a motion with the ALJ, and serves a copy on the agency, seeking to 
reopen on the grounds that extraordinary circumstances prevented the 
defendant from filing a timely answer, the initial decision shall be 
stayed pending the ALJ's decision on the motion. The ALJ shall permit 
the agency a reasonable amount of time, not less than 15 calendar days, 
to respond to the defendant's motion.
    (f) If, on such motion, the defendant can demonstrate extraordinary 
circumstances excusing the failure to file a timely answer, the ALJ 
shall withdraw the initial decision, if such a decision has been issued 
pursuant to paragraph (c) of this section, and shall grant the defendant 
an opportunity to answer the complaint.
    (g) A decision of the ALJ denying a defendant's motion under 
paragraph (e) of this section is not subject to reconsideration under 
Sec. 16.38.
    (h) The defendant may appeal to the authority head the decision 
denying a motion to reopen by filing a notice of appeal with the 
authority head within 15 days after the ALJ denies the motion. The 
timely filing of a notice of appeal shall stay the initial decision 
until the authority head decides the issue.
    (i) If the defendant files a timely notice of appeal with the 
authority head, the ALJ shall forward the record of the proceeding to 
the authority head.
    (j) The authority head shall decide expeditiously, and based solely 
on the record before the ALJ, whether extraordinary circumstances excuse 
the defendant's failure to file a timely answer.
    (k) If the authority head decides that extraordinary circumstances 
excuse the defendant's failure to file a timely answer, the authority 
head shall remand the case to the ALJ with instructions to grant the 
defendant an opportunity to file an answer.
    (l) If the authority head decides that the defendant's failure to 
file a timely answer is not excused, the authority head shall reinstate 
the initial decision of the ALJ, which shall become final and binding 
upon the parties 30 days after the authority head issues such decision.



Sec. 16.11  Referral of complaint and answer to the ALJ.

    Upon receipt of an answer, the reviewing official shall file the 
complaint and answer with the ALJ.



Sec. 16.12  Notice of hearing.

    (a) When the ALJ receives the complaint and answer, the ALJ shall 
promptly serve a notice of hearing upon the defendant and the agency 
representative in the manner prescribed by Sec. 16.8.
    (b) Such notice shall include--
    (1) The tentative time and place, and the nature of the hearing;
    (2) The legal authority and jurisdiction under which the hearing is 
to be held;
    (3) The matters of fact and law to be asserted;
    (4) A description of the procedures for the conduct of the hearing;
    (5) The names, addresses, and telephone numbers of the 
representatives of the Government and of the defendant, if any; and
    (6) Such other matters as the ALJ deems appropriate.



Sec. 16.13  Parties to the hearing.

    (a) The parties to the hearing shall be the defendant and the 
authority.
    (b) Pursuant to 31 U.S.C. 3730(c)(5), a private plaintiff under the 
False Claims Act may participate in these proceedings to the extent 
authorized by the provisions of that Act.



Sec. 16.14  Separation of functions.

    (a) The investigating official, the reviewing official, and any 
employee or agent of the authority who takes part in investigating, 
preparing, or presenting a particular case may not, in such case or a 
factually related case--
    (1) Participate in the hearing as the ALJ;
    (2) Participate or advise in the initial decision or the review of 
the initial decision by the authority head, except as a witness or a 
representative in public proceedings; or

[[Page 237]]

    (3) Make the collection of penalties and assessments under 31 U.S.C. 
3806.
    (b) The ALJ shall not be responsible to, or subject to the 
supervision or direction of the investigating official or the reviewing 
official.
    (c) Except as provided in paragraph (a) of this section, the 
representative for the Government may be an attorney employed anywhere 
in the Legal Division of the Department, or an attorney employed in the 
offices of either the investigating official or the reviewing official; 
however the representative of the Government may not participate or 
advise in the review of the initial decision by the authority head.



Sec. 16.15  Ex parte contacts.

    No party or person (except employees of the ALJ's office) shall 
communicate in any way with the ALJ on any matter at issue in a case, 
unless on notice and opportunity for all parties to participate. This 
provision does not prohibit a person or party from inquiring about the 
status of a case or asking routine questions concerning administrative 
functions or procedures.



Sec. 16.16  Disqualification of reviewing official or ALJ.

    (a) A reviewing official or ALJ in a particular case may disqualify 
himself or herself at any time.
    (b) A party may file with the ALJ a motion for disqualification of a 
reviewing official or an ALJ. Such motion shall be accompanied by an 
affidavit alleging personal bias or other reason for disqualification.
    (c) Such motion and affidavit shall be filed promptly upon the 
party's discovery of reasons requiring disqualification, or such 
objections shall be deemed waived.
    (d) Such affidavit shall state specific facts that support the 
party's assertion that personal bias or other reason for 
disqualification exists and the time and circumstances of the party's 
discovery of such facts. It shall be accompanied by a certificate of the 
representative of record that it is made in good faith.
    (e) Upon the filing of such a motion and affidavit, the ALJ shall 
proceed no further in the case until he or she resolves the matter of 
disqualification in accordance with paragrpah (f) of this section.
    (f)(1) If the ALJ determines that a reviewing official is 
disqualified, the ALJ shall dismiss the complaint without prejudice.
    (2) If the ALJ disqualifies himself or herself, the agency shall 
seek to have the case promptly reassigned to another ALJ.
    (3) If the ALJ denies a motion to disqualify, the authority head may 
determine the matter only as part of his or her review of the initial 
decision upon appeal, if any.



Sec. 16.17  Rights of parties.

    Except as otherwise limited by this part, all parties may--
    (a) Be accompanied, represented, and advised by an attorney;
    (b) Participate in any conference held by the ALJ;
    (c) Conduct discovery;
    (d) Agree to stipulations of fact or law, which shall be made part 
of the record;
    (e) Present evidence relevant to the issues at the hearing;
    (f) Present and cross-examine witnesses;
    (g) Present oral arguments at the hearing as permitted by the ALJ; 
and
    (h) Submit written beliefs and proposed findings of fact and 
conclusions of law after the hearing.



Sec. 16.18  Authority of the ALJ.

    (a) The ALJ shall conduct a fair and impartial hearing, avoid delay, 
maintain order, and assure that a record of the proceeding is made.
    (b) The ALJ has the authority to--
    (1) Set and change the date, time, and place of the hearing upon 
reasonable notice to the parties;
    (2) Continue or recess the hearing in whole or in part for a 
reasonable period of time;
    (3) Hold conferences to identify or simplify the issues, or to 
consider other matters that may aid in the expeditious disposition of 
the proceeding;
    (4) Administer oaths and affirmations;
    (5) Issue subpoenas requiring the attendance of witnesses and the 
production of documents at depositions or at hearings;

[[Page 238]]

    (6) Rule on motions and other procedural matters;
    (7) Regulate the scope and timing of discovery;
    (8) Regulate the course of the hearing and the conduct of 
representatives and parties;
    (9) Examine witnesses;
    (10) Receive, rule on, exclude, or limit evidence;
    (11) Upon motion of a party, take official notice of facts;
    (12) Upon motion of a party, decide cases, in whole or in part, by 
summary judgment where there is no disputed issue of material fact;
    (13) Conduct any conference, argument, or hearing on motions in 
person or by telephone; and
    (14) Exercise such other authority as is necessary to carry out the 
responsibilities of the ALJ under this part.
    (c) The ALJ does not have the authority to make any determinations 
regarding the validity of Federal statutes or regulations, or 
Departmental orders, Directives, or other published rules.



Sec. 16.19  Prehearing conferences.

    (a) The ALJ may schedule prehearing conferences as appropriate.
    (b) Upon the motion of any party, the ALJ shall schedule at least 
one prehearing conference at a reasonable time in advance of the 
hearing.
    (c) The ALJ may use prehearing conferences to discuss the following:
    (1) Simplification of the issues;
    (2) The necessity or desirability of amendments to the pleadings, 
including the need for a more definite statement;
    (3) Stipulations, admissions of fact or the content and authenticity 
of documents;
    (4) Whether the parties can agree to submission of the case on a 
stipulated record;
    (5) Whether a party chooses to waive appearance at an oral hearing 
and to submit only documentary evidence (subject to the objection of 
other parties) and written argument;
    (6) Limitation of the number of witnesses;
    (7) Scheduling dates for the exchange of witness lists and of 
proposed exhibits;
    (8) Discovery;
    (9) The time and place for the hearing; and
    (10) Such other matters as may tend to expedite the fair and just 
disposition of the proceedings.
    (d) The ALJ may issue an order containing all matters agreed upon by 
the parties or ordered by the ALJ at a prehearing conference.



Sec. 16.20  Disclosure of documents.

    (a) Upon written request to the reviewing official, the defendant 
may review any relevant and material documents, transcripts, records, 
and other material that relate to the allegations set out in the 
complaint and upon which the findings and conclusions of the 
investigating official under Sec. 16.4(b) are based unless such 
documents are subject to a privilege under Federal law. The Department 
shall schedule such review at a time and place convenient to it. Upon 
payment of fees for duplication, the defendant may obtain copies of such 
documents.
    (b) Upon written request to the reviewing official, the defendant 
also may obtian a copy of all exculpatory information in the possession 
of the reviewing official or investigating official relating to the 
allegations in the complaint, even if it is contained in a document that 
would otherwise be privileged. If the document would otherwise be 
privileged, only that portion containing exculpatory information must be 
disclosed.
    (c) The notice sent to the Attorney General from the reviewing 
official as described in Sec. 16.5 is not discoverable under any 
circumstances.
    (d) The defendant may file a motion to compel disclosure of the 
documents subject to the provisions of this section. Such a motion may 
only be filed with the ALJ following the filing of an answer pursuant to 
Sec. 16.9.



Sec. 16.21  Discovery.

    (a) The following types of discovery are authorized:
    (1) Requests for production of documents for inspection and copying;
    (2) Requests for admissions of the authenticity of any relevant 
document or of the truth of any relevant fact;
    (3) Written interrogatories; and

[[Page 239]]

    (4) Depositions.
    (b) For the purposes of this section and Secs. 16.22 and 16.23, the 
term ``documents'' includes information, documents, reports, answers, 
records, accounts, papers, and other data, either paper or electronic, 
and other documentary evidence. Nothing contained herein shall be 
interpreted to require the creation of a document.
    (c) Unless mutually agreed to by the parties, discovery is available 
only as ordered by the ALJ. The ALJ shall regulate the timing of 
discovery.
    (d) Motions for discovery. (1) A party seeking discovery may file a 
motion with the ALJ if it is not made available by another party on an 
informal basis. Such a motion shall be accompanied by a copy of the 
requested discovery, or in the case of depositions, a summary of the 
scope of the proposed deposition, and a description of the efforts which 
have been made by the party to obtain discovery.
    (2) Within ten days of service, a party may file an opposition to 
the motion and/or a motion for protective order as provided in 
Sec. 16.24.
    (3) The ALJ may grant a motion for discovery only if he or she finds 
that the discovery sought--
    (i) Is necessary for the expeditious, fair, and reasonable 
consideration of the issues;
    (ii) Is not unduly costly or burdensome;
    (iii) Will not unduly delay the proceeding; and
    (iv) Does not seek privileged information.
    (4) The burden of showing that discovery should be allowed is on the 
party seeking discovery.
    (5) The ALJ may grant discovery subject to a protective order under 
Sec. 16.24.
    (e) Depositions. (1) If a motion for deposition is granted, the ALJ 
shall issue a subpoena for the deponent, which may require the deponent 
to produce documents. The subpoena shall specify the time and place at 
which the deposition will be held.
    (2) The party seeking to depose shall serve the subpoena in the 
manner prescribed in Sec. 16.8.
    (3) The deponent may file with the ALJ a motion to quash the 
subpoena or a motion for a protective order within ten days of service.
    (4) The party seeking to depose shall provide for the taking of a 
verbatim transcript of the deposition, which it shall make available to 
all other parties for inspection and copying.
    (f) Each party shall bear its own costs of discovery.



Sec. 16.22  Exchange of witness lists, statements, and exhibits.

    (a) At least 15 days before the hearing or at such other time as may 
be ordered by the ALJ, the parties shall exchange witness lists, copies 
of prior statements of proposed witnesses, and copies of proposed 
hearing exhibits, including copies of any written statements that the 
party intends to offer in lieu of live testimony in accordance with 
Sec. 16.33(b). At the time the above documents are exchanged, any party 
that intends to rely on the transcript of deposition testimony in lieu 
of live testimony at the hearing, if permitted by the ALJ, shall provide 
each party with a copy of the specific pages of the transcript it 
intends to introduce into evidence.
    (b) If a party objects, the ALJ shall not admit into evidence the 
testimony of any witness whose name does not appear on the witness list 
or any exhibit not provided to the opposing party as provided above 
unless the ALJ finds good cause and that there is no prejudice to the 
objecting party.
    (c) Unless another party objects within the time set by the ALJ, 
documents exchanged in accordance with paragraph (a) of this section, 
shall be deemed to be authentic for the purpose of admissibility at the 
hearing.



Sec. 16.23  Subpoenas for attendance at hearing.

    (a) A party wishing to procure the appearance and testimony of any 
individual at the hearing may request that the ALJ issue a subpoena.
    (b) A subpoena requiring the attendance and testimony of an 
individual may also require the individual to produce documents at the 
hearing.
    (c) A party seeking a subpoena shall file a written request therefor 
not less than 15 days before the date fixed for the hearing unless 
otherwise allowed

[[Page 240]]

by the ALJ for good cause shown. Such request shall specify any 
documents to be produced and shall designate the witnesses and describe 
the address and location thereof with sufficient particularity to permit 
such witnesses to be found.
    (d) The subpoena shall specify the time and place at which the 
witness is to appear and any documents the witness is to bring with him 
or her.
    (e) The party seeking the subpoena shall serve it in the manner 
prescribed in Sec. 16.8. A subpoena on a party or upon an individual 
under the control of a party may be served by first class mail.
    (f) A party or the individual to whom the subpoena is directed may 
file with the ALJ a motion to quash the subpoena within ten days after 
service or on or before the time specified in the subpoena for 
compliance if it is less than ten days after service.



Sec. 16.24  Protective order.

    (a) A party or a prospective witness or deponent may file a motion 
for a protective order with respect to discovery sought by an opposing 
party or with respect to the hearing, seeking to limit the availability 
or disclosure of evidence.
    (b) In issuing a protective order, the ALJ may make any order which 
justice requires to protect a party or person from annoyance, 
embarrassment, oppression, or undue burden or expense, including one or 
more of the following:
    (1) That the discovery not be had;
    (2) That the discovery may be had only on specified terms and 
conditions, including a designation of the time or place;
    (3) That the discovery may be had only through a method of discovery 
other than that requested;
    (4) That certain matters not be inquired into, or that the scope of 
discovery be limited to certain matters;
    (5) That discovery be conducted with no one present except persons 
designated by the ALJ;
    (6) That the contents of discovery or evidence be sealed;
    (7) That a deposition after being sealed be opened only by order of 
the ALJ;
    (8) That a trade secret or other confidential research, development, 
commercial information, or facts pertaining to any criminal 
investigation, proceeding, or other administrative investigation not be 
disclosed or be disclosed only in a designated way; or
    (9) That the parties simultaneously file specified documents or 
information enclosed in sealed envelopes to be opened as directed by the 
ALJ.



Sec. 16.25  Fees.

    The party requesting a subpoena shall pay the cost of the fees and 
mileage of any witness subpoenaed in the amounts that would be payable 
to a witness in a proceeding in United States District Court. A check 
for witness fees and mileage shall accompany the subpoena when served, 
except that when a subpoena is issued on behalf of the authority, a 
check for witness fees and mileage need not accompany the subpoena.



Sec. 16.26  Form, filing and service of papers.

    (a) Form. (1) Documents filed with the ALJ shall include a original 
and two copies.
    (2) Every pleading and paper filed in the proceeding shall contain a 
caption setting forth the title of the action, the case number assigned 
by the ALJ, and a designation of the paper (e.g., motion to quash 
subpoena).
    (3) Every pleading and paper shall be signed by, and shall contain 
the address and telephone number of the party or the person on whose 
behalf the paper was filed, or his or her representative.
    (4) Papers are considered filed when they are mailed. Date of 
mailing may be etablished by a certificate from the party or its 
representative or by proof that the document was sent by certified or 
registered mail.
    (b) Service. A party filing a document with the ALJ shall, at the 
time of filing, serve a copy of such document on every other party. 
Service upon any party of any document other than the complaint or 
notice of hearing shall be made by delivering or mailing a copy to the 
party's last known address. When a party is represented by an attorney, 
service shall be made upon such representative in lieu of the actual 
party.

[[Page 241]]

    (c) Proof of service. A certificate of the individual serving the 
document by personal delivery or by mail, setting forth the manner of 
service, shall be proof of service.



Sec. 16.27  Computation of time.

    (a) In computing any period of time under this part or in an order 
issued thereunder, the time begins with the day following the act, 
event, or default, and includes the last day of the period, unless it is 
a Saturday, Sunday, or legal holiday observed by the Federal Government, 
in which event it includes the next business day.
    (b) When the period of time allowed is less than seven days, 
intermediate Saturdays, Sundays, and legal holidays observed by the 
Federal Government shall be excluded from the computation. When the 
period of time allowed is more than seven days, all intervening calendar 
days are included in the computation.
    (c) Where a document has been served or issued by mail, an 
additional five days will be added to the time permitted for any 
response.



Sec. 16.28  Motions.

    (a) Any application to the ALJ for an order or ruling shall be by 
motion. Motions shall state the relief sought, the authority relied 
upon, and the facts alleged, and shall be filed with the ALJ and served 
on all other parties.
    (b) Except for motions made during a prehearing conference or at the 
hearing, all motions shall be in writing. The ALJ may require that oral 
motions be reduced to writing.
    (c) Within 15 days after a written motion is served, or such other 
time as may be fixed by the ALJ, any party may file a response to such 
motion.
    (d) The ALJ may not grant a written motion before the time for 
filing responses thereto has expired, except upon consent of the parties 
or following a hearing on the motion, but may overrule or deny such 
motion without awaiting a response.
    (e) The ALJ shall make a reasonable effort to dispose of all 
outstanding motions prior to the beginning of the hearing.



Sec. 16.29  Sanctions.

    (a) The ALJ may sanction a person, including any party or 
representative for--
    (1) Failing to comply with an order, rule, or procedure governing 
the proceeding;
    (2) Failing to prosecute or defend an action; or
    (3) Engaging in other misconduct that interferes with the speedy, 
orderly, or fair conduct of the hearing.
    (b) Any such sanction, including but not limited to those listed in 
paragraphs (c), (d), and (e) of this section, shall reasonably relate to 
the nature of the failure or misconduct.
    (c) When a party fails to comply with an order, including an order 
for taking a deposition, the production of evidence within the party's 
control, or a request for admission, the ALJ may--
    (1) Draw an inference in favor of the requesting party with regard 
to the information sought;
    (2) In the case of requests for admission, deem each matter of which 
an admission is requested to be admitted;
    (3) Prohibit the party failing to comply with such order from 
introducing evidence concerning, or otherwise relying upon testimony 
relating to the information sought; and
    (4) Strike any part of the pleadings or other submissions of the 
party failing to comply with such request.
    (d) If a party fails to prosecute or defend an action under this 
part commenced by service of a notice of hearing, the ALJ may dismiss 
the action or may issue an initial decision imposing penalties and 
assessments.
    (e) The ALJ may refuse to consider any motion, request, response, 
brief or other document which is not filed in a timely fashion.



Sec. 16.30  The hearing and burden of proof.

    (a) The ALJ shall conduct a hearing on the record in order to 
determine whether the defendant is liable for a civil penalty or 
assessment under Sec. 16.3 and, if so, the appropriate amount of any 
such civil penalty or assessment considering any aggravating or 
mitigating factors.
    (b) The authority shall have the burden of proving defendant's 
liability and

[[Page 242]]

any aggravating factors by a preponderance of the evidence.
    (c) The defendant shall have the burden of proving any affirmative 
defenses and any mitigating factors by a preponderance of the evidence.
    (d) The hearing shall be open to the public unless otherwise ordered 
by the ALJ for good cause shown.



Sec. 16.31  Determining the amount of penalties and assessments.

    (a) In determining an appropriate amount of civil penalties and 
assessements, the ALJ and upon appeal, the authority head, should 
evaluate any circumstances that mitigate or aggravate the violation and 
should articulate in their opinions the reasons that support the 
penalties and assessments they impose. Because of the intangible costs 
of fraud, the expense of investigating such conduct, and the need to 
deter others who might be similarly tempted, double damages and a 
significant civil penalty ordinarily should be imposed.
    (b) Although not exhaustive, the following factors are among those 
that may influence the ALJ and the authority head in determining the 
amount of penalties and assessments to impose with respect to the 
misconduct (i.e., the false, fictitious, or fraudulent claims or 
statements) charged in the complaint:
    (1) The number of false, fictitious, or fraudulent claims or 
statements;
    (2) The time period over which such claims or statements were made;
    (3) The degree of the defendant's culpability with respect to the 
misconduct;
    (4) The amount of money or the value of the property, services, or 
benefit falsely claimed;
    (5) The value of the Government's actual loss as a result of the 
misconduct, including foreseeable consequential damages and the costs of 
investigation;
    (6) The relationship of the amount imposed as civil penalties to the 
amount of the Government's loss;
    (7) The potential or actual impact of the misconduct upon national 
defense, public health or safety, or public confidence in the management 
of Government programs and operations;
    (8) Whether the defendant has engaged in a pattern of the same or 
similar misconduct;
    (9) Whether the defendant attempted to conceal the misconduct;
    (10) The degree to which the defendant has involved others in the 
misconduct or in concealing it;
    (11) Where the misconduct of employees or agents is imputed to the 
defendant, the extent to which the defendant's practices fostered or 
attempted to preclude such misconduct;
    (12) Whether the defendant cooperated in or obstructed an 
investigation of the misconduct;
    (13) Whether the defendant assisted in identifying and prosecuting 
other wrongdoers;
    (14) The complexity of the program or transaction, and the degree of 
the defendant's sophistication with respect to it, including the extent 
of the defendant's prior participation in the program or in similar 
transactions;
    (15) Whether the defendant has been found, in any criminal, civil, 
or administrative proceeding to have engaged in similar misconduct or to 
have dealt dishonestly with the Government of the United States or of a 
State, directly or indirectly; and
    (16) The need to deter the defendant and others from engaging in the 
same or similar misconduct.
    (c) Nothing in this section shall be construed to limit the ALJ or 
the authority head from considering any other factors that in any given 
case may mitigate or aggravate the offense for which penalties and 
assessments are imposed.



Sec. 16.32  Location of hearing.

    (a) The hearing may be held--
    (1) In any judicial district of the United States in which the 
defendant resides or transacts business;
    (2) In any judicial district of the United States in which the claim 
or statement in issue was made; or
    (3) In such other place as may be agreed upon by the defendant and 
the ALJ.
    (b) Each party shall have the opportunity to present argument with 
respect to the location of the hearing.

[[Page 243]]

    (c) The hearing shall be held at the place and at the time ordered 
by the ALJ.



Sec. 16.33  Witnesses.

    (a) Except as provided in paragraph (b) of this section, testimony 
at the hearing shall be given orally by witnesses under oath or 
affirmation.
    (b) At the discretion of the ALJ, testimony may be admitted in the 
form of a written statement or deposition. Any such written statement 
must be provided to all other parties along with the last known address 
of such witness, in a manner which allows sufficient time for other 
parties to subpoena such witness for cross-examination at the hearing. 
Prior written statements of witnesses proposed to testify at the hearing 
and deposition transcripts shall be exchanged as provided in 
Sec. 16.22(a).
    (c) The ALJ shall exercise reasonable control over the mode and 
order of interrogating witnesses and presenting evidence so as to--
    (1) Make the interrogation and presentation effective for the 
ascertainment of the truth,
    (2) Avoid needless consumption of time, and
    (3) Protect witnesses from harassment or undue embarrassment.
    (d) The ALJ shall permit the parties to conduct such cross 
examination as may be required for a full and true disclosure of the 
facts.
    (e) At the discretion of the ALJ, a witness may be cross-examined on 
matters relevant to the proceeding without regard to the scope of his or 
her direct examination. To the extent permited by the ALJ, cross-
examination on matters outside the scope of direct examination shall be 
conducted in the manner of direct examination and may proceed by leading 
questions only if the witness is a hostile witness, an adverse party, or 
a witness identified with an adverse party.
    (f) Upon motion of any party, the ALJ shall order witnesses excluded 
so that they cannot hear the testimony of other witnesses. This rule 
does not authorize exclusion of--
    (1) A party who is an individual;
    (2) In the case of a party that is not an individual, an officer or 
employee of the party designated by the party's representative; or
    (3) An individual whose presence is shown by a party to be essential 
to the presentation of its case, including an individual employed by the 
Government engaged in assisting the representative for the Government.



Sec. 16.34  Evidence.

    (a) The ALJ shall determine the admissibility of evidence.
    (b) Except as provided herein, the ALJ shall not be bound by the 
Federal Rules of Evidence. However, the ALJ may apply the Federal Rules 
of Evidence where appropriate, e.g., to exclude unreliable evidence.
    (c) The ALJ shall exclude irrelevant, immaterial, or incompetent 
evidence.
    (d) Although relevant, evidence may be excluded if its probative 
value is substantially outweighed by the danger of unfair prejudice, 
confusion of the issues, or by considerations of undue delay or needless 
presentation of cumulative evidence.
    (e) Although relevant, evidence may be excluded if it is privileged 
under Federal law.
    (f) Evidence concerning offers of compromise or settlement shall be 
inadmissible to the extent provided in Rule 408 of the Federal Rules of 
Evidence.
    (g) The ALJ shall permit the parties to introduce rebuttal witnesses 
and evidence.
    (h) All documents and other evidence offered or taken for the record 
shall be open to examination by all parties, unless otherwise ordered by 
the ALJ pursuant to Sec. 16.24.



Sec. 16.35  The record.

    (a) The hearing will be recorded and transcribed. Transcripts may be 
obtained following the hearing from the ALJ at a cost not to exceed the 
actual cost of duplication.
    (b) The transcript of testimony, exhibits and other evidence 
admitted at the hearing, and all papers and requests filed in the 
proceeding constitute the record for the decision by the ALJ and the 
authority head.
    (c) The record may be inspected and copied (upon payment of a 
reasonable fee) by anyone, unless otherwise ordered by the ALJ pursuant 
to Sec. 16.24.

[[Page 244]]



Sec. 16.36  Post-hearing briefs.

    The ALJ may require the parties to file post-hearing briefs. The ALJ 
shall fix the time for filing such briefs, not to exceed 60 days from 
the date the parties receive the transcript of the hearing or, if 
applicable, the stipulated record. Such briefs may be accompanied by 
proposed findings of fact and conclusions of law. The ALJ may permit the 
parties to file reply briefs.



Sec. 16.37  Initial decision.

    (a) The ALJ shall issue an initial decision, based solely on the 
record, which shall contain findings of fact, conclusion of law, and the 
amount of any penalties and assessments imposed.
    (b) The findings of fact shall include a finding on each of the 
following issues:
    (1) Whether the claims or statements identified in the complaint, or 
any portions thereof, violate Sec. 16.3;
    (2) If the person is liable for penalties of assessments, the 
appropriate amount of any such penalties or assessments considering any 
mitigating or aggravating factors that he or she finds in the case, such 
as those described in Sec. 16.31.
    (c) The ALJ shall promptly serve the initial decision on all parties 
within 90 days after the time for submission of post-hearing briefs and 
reply briefs (if permitted) has expired. The ALJ shall at the same time 
serve all defendants with a statement describing the right of any 
defendant determined to be liable for a civil penalty or assessment to 
file a motion for reconsideration with the ALJ or a notice of appeal 
with the authority head. If the ALJ fails to meet the deadline contained 
in this paragraph, he or she shall notify the parties of the reason for 
the delay and shall set a new deadline.
    (d) Unless the initial decision of the ALJ is timely appealed to the 
authority head, or a motion for reconsideration of the initial decision 
is timely filed, the initial decision shall constitute the final 
decision of the authority head and shall be final and binding on the 
parties 30 days after it is issued by the ALJ.



Sec. 16.38  Reconsideration of initial decision.

    (a) Except as provided in paragraph (d) of this section, any party 
may file a motion for reconsideration of the initial decision within 20 
days of receipt of the initial decision. If service was made by mail, 
receipt will be presumed to be five days from the date of mailing in the 
absence of contrary proof.
    (b) Every such motion must set forth the matters claimed to have 
been erroneously decided and the nature of the alleged errors. Such 
motion shall be accompanied by a supporting brief.
    (c) Responses to such motions shall be allowed only upon request of 
the ALJ.
    (d) No party may file a motion for reconsideration of an initial 
decision that has been revised in response to a previous motion for 
reconsideration.
    (e) The ALJ may dispose of a motion for reconsideration by denying 
it or by issuing a revised initial decision.
    (f) When a motion for reconsideration is made, the time periods for 
appeal to the authority head contained in Sec. 16.38, and for finality 
of the initial decision in Sec. 16.36(d), shall begin on the date the 
ALJ issues the denial of the motion for reconsideration or a revised 
initial decision, as appropriate.



Sec. 16.39  Appeal to authority head.

    (a) Any defendant who has filed a timely answer and who is 
determined in an initial decision to be liable for a civil penalty or 
assessment may appeal such decision to the authority head by filing a 
notice of appeal with the authority head in accordance with this 
section.
    (b)(1) No notice of appeal may be filed until the time period for 
filing a motion for reconsideration under Sec. 16.38 has expired.
    (2) If a motion for reconsideration is timely filed, a notice of 
appeal must be filed within 30 days after the ALJ denies the motion or 
issues a revised initial decision, whichever applies.
    (3) If no motion for reconsideration is timely filed, a notice of 
appeal must be filed within 30 days after the ALJ issues the initial 
decision.
    (4) The authority head may extend the initial 30 days period for an 
additional 30 days if the defendant files

[[Page 245]]

with the authority head a request for extension within the initial 30 
days period and shows good cause.
    (c) If the defendant files a timely notice of appeal with the 
authority head, the ALJ shall forward the notice of appeal and record of 
the proceeding to the authority head.
    (d) A notice of appeal shall be accompanied by a written brief 
specifying exceptions to the initial decision and reasons supporting the 
exceptions.
    (e) The representative for the agency may file a brief in opposition 
to exceptions within 30 days of receiving the notice of appeal and 
accompanying brief.
    (f) There is no right to appear personally before the authority 
head.
    (g) There is right to appeal any interlocutory ruling by the ALJ.
    (h) In reviewing the initial decision, the authority head shall not 
consider any objection that was not raised before the ALJ unless a 
demonstration is made of extraordinary circumstances causing the failure 
to raise the objection.
    (i) If any party demonstrates to the satisfaction of the authority 
head, prior to the issuance of the authority head's decision that 
additional evidence not presented at such hearing is material and that 
there were reasonable grounds for the failure to present such evidence 
at the hearing, the authority head shall remand the matter to the ALJ 
for consideration of such additional evidence.
    (j) The authority head may affirm, reduce, reverse, compromise, 
remand, or settle any penalty or assessment, determined by the ALJ in 
any initial decision.
    (k) The authority head shall promptly serve each party to the appeal 
to the ALJ with a copy of the decision of the authority head. At the 
same time the authority head shall serve the defendant with a statement 
describing the defendant's right to seek judicial review.
    (l) Unless a petition for judicial review is filed as provided in 31 
U.S.C. 3805 after a defendant has exhausted all administrative remedies 
under this part and within 60 days after the date on which the authority 
head serves the defendant with a copy of the authority head's decision, 
a determination that a defendant is liable under Sec. 16.3 is final and 
is not subject to judicial review.



Sec. 16.40  Stays ordered by the Department of Justice.

    If at any time the Attorney General or an Assistant Attorney General 
designated by the Attorney General transmits to the authority head a 
written finding that continuation of the administrative process 
described in this part with respect to a claim or statement may 
adversely affect any pending or potential criminal or civil action 
related to such claim or statement, the authority head shall stay the 
process immediately. In such a case, the authority head may order the 
process resumed only upon receipt of the written authorization of the 
Attorney General.



Sec. 16.41  Stay pending appeal.

    (a) An initial decision is stayed automatically pending disposition 
of a motion for reconsideration or of an appeal to the authority head.
    (b) No administrative stay is available following a final decision 
of the authority head.



Sec. 16.42  Judicial review.

    Section 3805 of title 31, United States Code, authorizes judicial 
review by an appropriate United States District Court of a final 
decision of the authority head imposing penalties or assessments under 
this part and specifies the procedures for such review.



Sec. 16.43  Collection of civil penalties and assessments.

    Sections 3806 and 3808(b) of title 31, United States Code, authorize 
actions for collection of civil penalties and assessments imposed under 
this part and specify the procedures for such actions.



Sec. 16.44  Right to administrative offset.

    The amount of any penalty or assessment which has become final, or 
for which a judgment has been entered under Sec. 16.42 or Sec. 16.43, or 
any amount agreed upon in a compromise or settlement under Sec. 16.46, 
may be collected by administrative offset under 31 U.S.C. 3716, except 
that an administrative offset may not be made under this subsection 
against a refund of an overpayment of Federal taxes, then or later

[[Page 246]]

owing by the United States to the defendant.



Sec. 16.45  Deposit in Treasury of United States.

    All amounts collected pursuant to this part shall be deposited as 
miscellaneous receipts in the Treasury of the United States, except as 
provided in 31 U.S.C. 3806(g).



Sec. 16.46  Compromise or settlement.

    (a) Parties may make offers of compromise or settlement at any time.
    (b) The reviewing official has the exclusive authority to compromise 
or settle a case under this part at any time after the date on which the 
reviewing official is permitted to issue a complaint and before the date 
on which the ALJ issues an initial decision.
    (c) The authority head has exclusive authority to compromise or 
settle a case under this part at any time after the date on which the 
ALJ issues an initial decision, except during the pendency of any review 
under Sec. 16.42 or during the pendency of any action to collect 
penalties and assessments under Sec. 16.43.
    (d) The Attorney General has exclusive authority to compromise or 
settle a case under this part during the pendency of any review under 
Sec. 16.42 or of any action to recover penalties and assessments under 
31 U.S.C. 3806.
    (e) The investigating official may recommend settlement terms to the 
reviewing official, the authority head, or the Attorney General, as 
appropriate. The reviewing official may recommend settlement terms to 
the authority head, or the Attorney General, as appropriate.
    (f) Any compromise or settlement must be in writing and signed by 
all parties and their representatives.



Sec. 16.47  Limitations.

    (a) The notice of hearing with respect to a claim or statement must 
be served in the manner specified in Sec. 16.8 within 6 years after the 
date on which such claim or statement is made.
    (b) If the defendant fails to file a timely answer, service of a 
notice under Sec. 16.10(b) shall be deemed a notice of hearing for 
purposes of this section.
    (c) The time limits of this statute of limitations may be extended 
by agreement of the parties.



PART 17--ENFORCEMENT OF NONDISCRIMINATION ON THE BASIS OF HANDICAP IN PROGRAMS OR ACTIVITIES CONDUCTED BY THE DEPARTMENT OF THE TREASURY--Table of Contents




Sec.
17.101  Purpose.
17.102  Application.
17.103  Definitions.
17.104-17.109  [Reserved]
17.110  Self-evaluation.
17.111  Notice.
17.112-17.129  [Reserved]
17.130  General prohibitions against discrimination.
17.131-17.139  [Reserved]
17.140  Employment.
17.141-17.148  [Reserved]
17.149  Program accessibility: Discrimination prohibited.
17.150  Program accessibility: Existing facilities.
17.151  Program accessibility: New construction and alterations.
17.152-17.159  [Reserved]
17.160  Communications.
17.161-17.169  [Reserved]
17.170  Compliance procedures.
17.171-17.999  [Reserved]

    Authority: 29 U.S.C. 794.

    Source: 56 FR 40788, Aug. 16, 1991, unless otherwise noted.



Sec. 17.101  Purpose.

    The purpose of this part is to effectuate section 119 of the 
Rehabilitation, Comprehensive Services, and Developmental Disabilities 
Amendments of 1978, which amended section 504 of the Rehabilitation Act 
of 1973 (``section 504'') to prohibit discrimination on the basis of 
handicap in programs or activities conducted by Executive agencies or 
the United States Postal Service.



Sec. 17.102  Application.

    This part applies to all programs or activities conducted by the 
agency, except for programs or activities conducted outside the United 
States that do not involve individuals with handicaps in the United 
States.

[[Page 247]]



Sec. 17.103  Definitions.

    For purposes of this part, the term--
    (a) Agency means the Department of the Treasury.
    (b) Assistant Attorney General means the Assistant Attorney General, 
Civil Rights Division, United States Department of Justice.
    (c) Auxiliary aids means services or devices that enable persons 
with impaired sensory, manual, or speaking skills to have an equal 
opportunity to participate in, and enjoy the benefits of, programs or 
activities conducted by the agency. For example, auxiliary aids useful 
for persons with impaired vision include readers, Brailled materials, 
audio recordings and other similar services and devices. Auxiliary aids 
useful for persons with impaired hearing include telephone handset 
amplifiers, telephones compatible with hearing aids, telecommunications 
devices for deaf persons (TDD's), interpreters, notetakers, written 
materials and other similar services and devices.
    (d) Complete complaint means a written statement that contains the 
complainant's name and address, and describes the agency's alleged 
discriminatory action in sufficient detail to inform the agency of the 
nature and date of the alleged violation of section 504. It shall be 
signed by the complainant or by someone authorized to do so on his or 
her behalf. Complaints filed on behalf of classes of individuals with 
handicaps shall also identify (where possible) the alleged victims of 
discrimination.
    (e) Facility means all or any portion of a building, structure, 
equipment, road, walk, parking lot, rolling stock, or other conveyance, 
or other real or personal property.
    (f) Individual with handicaps means any person who has a physical or 
mental impairment that substantially limits one or more of the 
individual's major life activities, has a record of such an impairment, 
or is regarded as having such an impairment. As used in this definition, 
the phrase: (1) Physical or mental impairment includes: (i) Any 
physiological disorder or condition, cosmetic disfigurement, or 
anatomical loss affecting one or more of the following body systems: 
Neurological; musculoskeletal; special sense organs; respiratory, 
including speech organs, cardiovascular; reproductive, digestive; 
genitourinary; hemic and lymphatic; skin; and endocrine; or (ii) any 
mental or psychological disorder such as mental retardation, organic 
brain syndrome, emotional or mental illness, and specific learning 
disabilities. The term physical or mental impairment includes, but is 
not limited to, such diseases and conditions as orthopedic, visual, 
speech and hearing impairments, cerebral palsy, epilepsy, muscular 
dystrophy, multiple sclerosis, cancer, heart disease, diabetes, mental 
retardation, emotional illness, drug addiction and alcoholism.
    (2) Major life activities includes functions such as caring for 
one's self, performing manual tasks, walking, seeing, hearing, speaking, 
breathing, learning, and working.
    (3) Has a record of such an impairment means has a history of, or 
has been misclassified as having, a mental or physical impairment that 
substantially limits one or more of the individual's major life 
activities.
    (4) Is regarded as having an impairment means--
    (i) Has a physical or mental impairment that does not substantially 
limit major life activities but is treated by the agency as constituting 
such a limitation;
    (ii) Has a physical or mental impairment that substantially limits 
major life activities only as a result of the attitudes of others toward 
such impairment; or
    (iii) Has none of the impairments defined in subparagraph (1) of 
this definition but is treated by the agency as having such an 
impairment.
    (g) Qualified individual with handicaps means--(1) With respect to 
an agency program or activity under which a person is required to 
perform services or to achieve a level of accomplishment, an individual 
with handicaps who meets the essential eligibility requirements and who 
can achieve the purpose of the program or activity without modifications 
in the program or activity that the agency can demonstrate would result 
in a fundamental alteration in the nature of the program; and
    (2) With respect to any other program or activity, an individual 
with

[[Page 248]]

handicaps who meets the essential eligibility requirements for 
participation in, or receipt of benefits from, that program or activity; 
and
    (3) For purposes of employment, ``qualified handicapped person'' is 
defined in 29 CFR 1613.702(f), which is made applicable to this part by 
Sec. 17.140.
    (h) Section 504 means section 504 of the Rehabilitation Act of 1973 
(Pub. L. 93-112, 87 Stat. 394 (29 U.S.C. 794)), as amended. As used in 
this part, section 504 applies only to programs or activities conducted 
by Executive agencies and not to federally assisted programs.



Secs. 17.104-17.109  [Reserved]



Sec. 17.110  Self-evaluation.

    (a) The agency shall, by two years after the effective date of this 
part, evaluate its current policies and practices, and the effects 
thereof, to determine if they meet the requirements of this part. To the 
extent modification of any such policy and practice is required, the 
agency shall proceed to make the necessary modifications.
    (b) The agency shall provide an opportunity to interested persons, 
including individuals with handicaps or organizations representing 
individuals with handicaps, to participate in the self-evaluation 
process.
    (c) The agency shall, until three years following the completion of 
the self-evaluation, maintain on file and make available for public 
inspection:
    (1) A description of areas examined and any problems identified; and
    (2) A description of any modifications made; and
    (3) A list of participants in the self-evaluation process.



Sec. 17.111  Notice.

    The agency shall make available to all Treasury employees, and to 
all interested persons, as appropriate, information regarding the 
provisions of this part and its applicability to the programs or 
activities conducted by the agency, and make such information available 
to them in such a manner as is necessary to apprise them of the 
protections against discrimination assured them by section 504 and this 
part.



Secs. 17.112-17.129  [Reserved]



Sec. 17.130  General prohibitions against discrimination.

    (a) No qualified individual with handicaps in the United States, 
shall, by reason of his or her handicap, be excluded from the 
participation in, be denied the benefits of, or otherwise be subjected 
to discrimination under any program or activity conducted by the agency.
    (b)(1) The agency, in providing any aid, benefit, or service, may 
not directly or through contractual, licensing, or other arrangements, 
on the basis of handicap--
    (i) Deny a qualified individual with handicaps the opportunity to 
participate in or benefit from the aid, benefit, or service;
    (ii) Afford a qualified individual with handicaps an opportunity to 
participate in or benefit from the aid, benefit, or service that is not 
equal to that afforded others;
    (iii) Provide a qualified individual with handicaps with an aid, 
benefit, or service that is not as effective in affording equal 
opportunity to obtain the same result, to gain the same benefit, or to 
reach the same level of achievement as that provided to others;
    (iv) Provide different or separate aid, benefits or services to 
individuals with handicaps or to any class of individuals with handicaps 
than is provided to others unless such action is necessary to provide 
qualified individuals with handicaps with aid, benefits or services that 
are as effective as those provided to others;
    (v) Deny a qualified individual with handicaps the opportunity to 
participate as a member of planning or advisory boards; or
    (vi) Otherwise limit a qualified individual with handicaps in the 
enjoyment of any right, privilege, advantage, or opportunity enjoyed by 
others receiving the aid, benefit, or service.
    (2) For purposes of this part, aids, benefits, and services, to be 
equally effective, are not required to produce the identical result or 
level of achievement for individuals with handicaps and for 
nonhandicapped persons, but must afford individuals with handicaps equal 
opportunity to obtain the same result,

[[Page 249]]

to gain the same benefit, or to reach the same level of achievement in 
the most integrated setting appropriate to the individual's needs.
    (3) Even if the agency is permitted, under paragraph (b)(1)(iv) of 
this section, to operate a separate or different program for individuals 
with handicaps or for any class of individuals with handicaps, the 
agency must permit any qualified individual with handicaps who wishes to 
participate in the program that is not separate or different to do so.
    (4) The agency may not, directly or through contractual or other 
arrangements, utilize criteria or methods of administration the purpose 
or effect of which would--
    (i) Subject qualified individuals with handicaps to discrimination 
on the basis of handicap; or
    (ii) Defeat or substantially impair accomplishment of the objectives 
of a program or activity with respect to individuals with handicaps.
    (5) The agency may not, in determining the site or location of a 
facility, make selections the purpose or effect of which would--
    (i) Exclude individuals with handicaps from, deny them the benefits 
of, or otherwise subject them to discrimination under any program or 
activity conducted by the agency; or
    (ii) Defeat or substantially impair the accomplishment of the 
objectives of a program or activity with respect to individuals with 
handicaps.
    (6) The agency, in the selection of procurement contractors, may not 
use criteria that subject qualified individuals with handicaps to 
discrimination on the basis of handicap.
    (7) The agency may not administer a licensing or certification 
program in a manner that subjects qualified individuals with handicaps 
to discrimination on the basis of handicap, nor may the agency establish 
requirements for the programs or activities of licensees or certified 
entities that subject qualified individuals with handicaps to 
discrimination on the basis of handicap. However, the programs or 
activities of entities that are licensed or certified by the agency are 
not, themselves, covered by this part.
    (c) The exclusion of nonhandicapped persons from the benefits of a 
program limited by Federal statute or Executive order to individuals 
with handicaps or the exclusion of a specific class of individuals with 
handicaps from a program limited by Federal statute or Executive order 
to a different class of individuals with handicaps is not prohibited by 
this part.
    (d) The agency shall administer programs and activities in the most 
integrated setting appropriate to the needs of qualified individuals 
with handicaps.



Secs. 17.131-17.139  [Reserved]



Sec. 17.140  Employment.

    No qualified individual with handicaps shall, on the basis of 
handicap, be subjected to discrimination in employment under any program 
or activity conducted by the Department. The definitions, requirements 
and procedures of section 501 of the Rehabilitation Act of 1973 (29 
U.S.C. 791), as established by the Equal Employment Opportunity 
Commission in 29 CFR part 1613, shall apply to employment of federally 
conducted programs or activities.



Secs. 17.141-17.148  [Reserved]



Sec. 17.149  Program accessibility: Discrimination prohibited.

    Except as otherwise provided in Sec. 17.150, no qualified individual 
with handicaps shall, because the agency's facilities are inaccessible 
to or unusable by individuals with handicaps, be denied the benefits of, 
be excluded from participation in, or otherwise be subjected to 
discrimination under any program or activity conducted by the agency.



Sec. 17.150  Program accessibility; Existing facilities.

    (a) General. The agency shall operate each program or activity so 
that the program or activity, when viewed in its entirety, is readily 
accessible to and usable by individuals with handicaps. This paragraph 
does not require the agency--
    (1) To make structural alterations in each of its existing 
facilities in order to make them accessible to and usable by individuals 
with handicaps where

[[Page 250]]

other methods are effective in achieving compliance with this section; 
or
    (2) To take any action that it can demonstrate would result in a 
fundamental alteration in the nature of a program or activity or in 
undue financial and administrative burdens. In those circumstances where 
agency personnel believe that the proposed action would fundamentally 
alter the program or activity or would result in undue financial and 
administrative burdens, the agency has the burden of proving that 
compliance with the Sec. 17.150(a) would result in such alteration or 
burdens. The decision that compliance would result in such alteration or 
burdens must be made by the agency head or his or her designee after 
considering all agency resources available for use in the funding and 
operation of the conducted program or activity and must be accompanied 
by a written statement of the reasons for reaching that conclusion. If 
an action would result in such an alteration or such burdens, the agency 
shall take any other action that would not result in such an alteration 
or such burdens but would nevertheless ensure that individuals with 
handicaps receive the benefits and services of the program or activity.
    (b) Methods. The agency may comply with the requirements of this 
section through such means as redesign of equipment, reassignment of 
services to accessible buildings, assignment of aides to beneficiaries, 
home visits, delivery of services at alternate accessible sites, 
alteration of existing facilities and construction of new facilities, 
use of accessible rolling stock, or any other methods that result in 
making its programs or activities readily accessible to and usable by 
individuals with handicaps. The agency, in making alterations to 
existing buildings, shall meet accessibility requirements to the extent 
compelled by the Architectural Barriers Act of 1968, as amended (42 
U.S.C. 4151-4157), and any regulations implementing it. In choosing 
among available methods for meeting the requirements of this section, 
the agency shall give priority to those methods that offer programs and 
activities to qualified individuals with handicaps in the most 
integrated setting appropriate.
    (c) Time period for compliance. The agency shall comply with the 
obligations established under this section within sixty (60) days of the 
effective date of this part except that where structural changes in 
facilities are undertaken, such changes in facilities are undertaken, 
such changes shall be made within three years of the effective date of 
this part, but in any event as expeditiously as possible.
    (d) Transition plan. In the event that structural changes to 
facilities will be undertaken to achieve program accessibility, the 
agency shall develop within six months of the effective date of this 
part, a transition plan setting forth the steps necessary to complete 
such changes. The agency shall provide an opportunity to interested 
persons, including individuals with handicaps or organizations 
representing individuals with handicaps, to participate in the 
development of the transition plan by submitting comments (both 
telephonic and written). A copy of the transition plan shall be made 
available for public inspection. The plan shall at a minimum--
    (1) Identify physical obstacles in the agency's facilities that 
limit the physical accessibility of its programs or activities to 
individuals with handicaps;
    (2) Describe in detail the methods that will be used to make the 
facilities accessible;
    (3) Specify the schedule for taking the steps necessary to achieve 
compliance with this section and, if the time period of the transition 
plan is longer than one year, identify steps that will be taken during 
each year of the transition period; and
    (4) Indicate the official responsible for implementation of the 
plan.



Sec. 17.151  Program accessibility: New construction and alterations.

    Each building or part of a building that is constructed or altered 
by, on behalf of, or for the use of the agency shall be designed, 
constructed, or altered so as to be readily accessible to and usable by 
individuals with handicaps. The definitions, requirements, and standards 
of the Architectural Barriers Act (42 U.S.C. 4151-4157), as established 
in 41 CFR 101-19.600 through 101-

[[Page 251]]

19.607 apply to buildings covered by this section.



Secs. 17.152-17.159  [Reserved]



Sec. 17.160  Communications.

    (a) The agency shall take appropriate steps to effectively 
communicate with applicants, participants, personnel of other Federal 
entities, and members of the public.
    (1) The agency shall furnish appropriate auxiliary aids where 
necessary to afford an individual with handicaps an equal opportunity to 
participate in, and enjoy the benefits of, a program or activity 
conducted by the agency.
    (i) In determining what type of auxiliary aid is necessary, the 
agency shall give primary consideration to the requests of the 
individual with handicaps.
    (ii) The agency need not provide individually prescribed devices, 
readers for personal use or study, or other devices of a personal nature 
to applicants or participants in programs.
    (2) Where the agency communicates with applicants and beneficiaries 
by telephone, the agency shall use telecommunication devices for deaf 
persons (TDD's) or equally effective telecommunication systems to 
communicate with persons with impaired hearing.
    (b) The agency shall make available to interested persons, including 
persons with impaired vision or hearing, information as to the existence 
and location of accessible services, activities, and facilities.
    (c) The agency shall post notices at a primary entrance to each of 
its inaccessible facilities, directing users to an accessible facility, 
or to a location at which they can obtain information about accessible 
facilities. The international symbol for accessibility shall be used at 
each primary entrance of an accessible facility.
    (d) This section does not require the agency to take any action that 
it can demonstrate would result in a fundamental alteration in the 
nature of a program or activity or in undue financial and administrative 
burdens.
    In those circumstances where agency personnel believe that the 
proposed action would fundamentally alter the program or activity or 
would result in undue financial and administrative burdens, the agency 
has the burden of proving that compliance with Sec. 17.160 would result 
in such alteration or burdens. The decision that compliance would result 
in such alteration or burdens must be made by the agency head or his or 
her designee after considering all resources available for use in the 
funding and operation of the conducted program or activity and must be 
accompanied by a written statement of the reasons for reaching that 
conclusion. If an action required to comply with this section would 
result in such an alteration or such burdens, the agency shall take any 
other action that would not result in such an alteration or such burdens 
but would nevertheless ensure that, to the maxium extent possible, 
individuals with handicaps receive the benefits and services of the 
program or activity.



Secs. 17.161-17.169  [Reserved]



Sec. 17.170  Compliance procedures.

    (a) Except as provided in paragraph (b) of this section, this 
section applies to all allegations of discrimination on the basis of 
handicap in programs and activities conducted by the agency.
    (b) The agency shall process complaints alleging violations of 
section 504 with respect to employment according to the procedures 
established by the Equal Employment Opportunity Commission in 29 CFR 
part 1613 pursuant to section 501 of the Rehabilitation Act of 1973 (29 
U.S.C. 791).
    (c) All other complaints alleging violations of section 504 may be 
sent to the Director, Office of Equal Opportunity Program, Department of 
the Treasury, 1500 Pennsylvania Avenue, NW., Washington, DC 20220. The 
Deputy Assistant Secretary for Departmental Finance and Management shall 
be responsible for coordinating implementation of this section.
    (d)(1) Any person who believes that he or she has been subjected to 
discrimination prohibited by this part may by him or herself or by his 
or her authorized representative file a complaint. Any person who 
believes that any specific class of persons has been subjected to 
discrimination prohibited

[[Page 252]]

by this part and who is a member of that class or the authorized 
representative of a member of that class may file a complaint.
    (2) The agency shall accept and investigate all complete complaints 
over which it has jurisdiction.
    (3) All complete complaints must be filed within 180 days of the 
alleged act of discrimination. The agency may extend this time period 
for good cause.
    (e) If the agency receive a complaint over which it does not have 
jurisdiction, it shall promptly notify the complainant and shall make 
reasonable efforts to refer the complaint to the appropriate government 
entity.
    (f) The agency shall notify the Architectural and Transportation 
Barriers Compliance Board upon receipt of any complaint alleging that a 
building or facility that is subject to the Architectural Barriers Act 
of 1968, as amended (42 U.S.C. 4151-4157), is not readily accessible to 
and usable by individuals with handicaps.
    (g)(1) Within 180 days of the receipt of a complete complaint over 
which it has jurisdiction, the agency shall notify the complainant of 
the results of the investigation in a letter containing--
    (i) Findings of fact and conclusions of law;
    (ii) A description of a remedy for each violation found; and
    (iii) A notice of the right to appeal.
    (2) Agency employees are required to cooperate in the investigation 
and attempted resolution of complaints. Employees who are required to 
participate in any investigation under this section shall do so as part 
of their official duties and during the course of regular duty hours.
    (3) If a complaint is resolved informally, the terms of the 
agreement shall be reduced to writing and made part of the complaint 
file, with a copy of the agreement provided to the complainant. The 
written agreement shall describe the subject matter of the complaint and 
any corrective action to which the parties have agreed.
    (h) Appeals of the findings of fact and conclusions of law or 
remedies must be filed by the complainant within 60 days of receipt from 
the agency of the letter required by Sec. 17.170(g). The agency may 
extend this time for good cause.
    (i) Timely appeals shall be accepted and processed by the Director, 
Human Resources Directorate, or his or her designee, who will issue the 
final agency decision which may include appropriate corrective action to 
be taken by the agency.
    (j) The agency shall notify the complainant of the results of the 
appeal within 30 days of the receipt of the appeal. If the agency 
determines that it needs additional information from the complainant, it 
shall have 30 days from the date it received the additional information 
to make its determination on the appeal.
    (k) The time limits cited in paragraphs (g) and (j) of this section 
may be extended for an individual case when the Assistant Secretary for 
Departmental Finance and Management determines that there is good cause, 
based on the particular circumstances of that case, for the extension.
    (l) The agency may delegate its authority for conducting complaint 
investigations to other Federal agencies or may contract with a 
nongovernment investigator to perform the investigation, but the 
authority for making the final determination may not be delegated to 
another agency.



Secs. 17.171--17.999  [Reserved]



PART 18--OFFICIALS DESIGNATED TO PERFORM THE FUNCTIONS AND DUTIES OF CERTAIN OFFICES IN CASE OF ABSENCE, DISABILITY, OR VACANCY--Table of Contents




Sec.
18.1  Designation of First Assistants.
18.2  Exceptions.

    Authority: 5 U.S.C. 301; 31 U.S.C. 321.

    Source: 64 FR 62112, Nov. 16, 1999, unless otherwise noted.



Sec. 18.1  Designation of First Assistants.

    Except as provided in Sec. 18.2, every office within the Department 
of the Treasury (including its bureaus) to which appointment is required 
to be made by the President with the advice and consent of the Senate 
(``PAS Office'') may have a First Assistant within the meaning of 5 
U.S.C. 3345-3349d.

[[Page 253]]

    (a) Where there is a position of principal deputy to the PAS Office, 
the principal deputy shall be the First Assistant.
    (b) Where there is only one deputy position to the PAS Office, the 
official in that position shall be the First Assistant.
    (c) Where neither paragraph (a) nor (b) of this section is 
applicable to the PAS Office, the Secretary of the Treasury may 
designate in writing the First Assistant.



Sec. 18.2  Exceptions.

    (a) Section 18.1 shall not apply:
    (1) When a statute which meets the requirements of 5 U.S.C. 3347(a) 
prescribes another means for authorizing an officer or employee to 
perform the functions and duties of a PAS Office in the Department 
temporarily in an acting capacity; and
    (2) To the office of a member of the Internal Revenue Service 
Oversight Board.
    (b) The Inspector General of the Department of the Treasury shall 
determine any arrangements for the temporary performance of the 
functions and duties of the Inspector General of the Department of the 
Treasury when that office is vacant.
    (c) The Treasury Inspector General for Tax Administration shall 
determine any arrangements for the temporary performance of the 
functions and duties of the Treasury Inspector General for Tax 
Administration when that office is vacant.



PART 19--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)--Table of Contents




                           Subpart A--General

Sec.
19.100  Purpose.
19.105  Definitions.
19.110  Coverage.
19.115  Policy.

                       Subpart B--Effect of Action

19.200  Debarment or suspension.
19.205  Ineligible persons.
19.210  Voluntary exclusion.
19.215  Exception provision.
19.220  Continuation of covered transactions.
19.225  Failure to adhere to restrictions.

                          Subpart C--Debarment

19.300  General.
19.305  Causes for debarment.
19.310  Procedures.
19.311  Investigation and referral.
19.312  Notice of proposed debarment.
19.313  Opportunity to contest proposed debarment.
19.314  Debarring official's decision.
19.315  Settlement and voluntary exclusion.
19.320  Period of debarment.
19.325  Scope of debarment.

                          Subpart D--Suspension

19.400  General.
19.405  Causes for suspension.
19.410  Procedures.
19.411  Notice of suspension.
19.412  Opportunity to contest suspension.
19.413  Suspending official's decision.
19.415  Period of suspension.
19.420  Scope of suspension.

       Subpart E--Responsibilities of GSA, Agency and Participants

19.500  GSA responsibilities.
19.505  Department of the Treasury responsibilities.
19.510  Participant's responsibilities.

          Subpart F--Drug-Free Workplace Requirements (Grants)

19.600  Purpose.
19.605  Definitions.
19.610  Coverage.
19.615  Grounds for suspension of payments, suspension or termination of 
          grants, or suspension or debarment.
19.620  Effect of violation.
19.625  Exception provision.
19.630  Certification requirements and procedures.
19.635  Reporting of and employee sanctions for convictions of criminal 
          drug offenses.

Appendix A to Part 19--Certification Regarding Debarment, Suspension, 
          and Other Responsibility Matters--Primary Covered Transactions
Appendix B to Part 19--Certification Regarding Debarment, Suspension, 
          Ineligibility and Voluntary Exclusion--Lower Tier Covered 
          Transactions
Appendix C to Part 19--Certification Regarding Drug-Free Workplace 
          Requirements

    Authority: E.O. 12549; sec. 5151-5160 of the Drug-Free Workplace Act 
of 1988 (Pub. L.

[[Page 254]]

100-690, Title V, Subtitle D; 41 U.S.C. 701 et seq.); 31 U.S.C. 321.

    Source: 53 FR 19187, and 19204, May 26, 1988, unless otherwise 
noted. Redesignated at 54 FR 4958, Jan. 31, 1989.

    Cross Reference: See also Office of Management and Budget notice 
published at 55 FR 21679, May 25, 1990, and 60 FR 33036, June 26, 1995.



                           Subpart A--General



Sec. 19.100  Purpose.

    (a) Executive Order (E.O.) 12549 provides that, to the extent 
permitted by law, Executive departments and agencies shall participate 
in a governmentwide system for nonprocurement debarment and suspension. 
A person who is debarred or suspended shall be excluded from Federal 
financial and nonfinancial assistance and benefits under Federal 
programs and activities. Debarment or suspension of a participant in a 
program by one agency shall have governmentwide effect.
    (b) These regulations implement section 3 of E.O. 12549 and the 
guidelines promulgated by the Office of Management and Budget under 
section 6 of the E.O. by:
    (1) Prescribing the programs and activities that are covered by the 
governmentwide system;
    (2) Prescribing the governmentwide criteria and governmentwide 
minimum due process procedures that each agency shall use;
    (3) Providing for the listing of debarred and suspended 
participants, participants declared ineligible (see definition of 
``ineligible'' in Sec. 19.105), and participants who have voluntarily 
excluded themselves from participation in covered transactions;
    (4) Setting forth the consequences of a debarment, suspension, 
determination of ineligibility, or voluntary exclusion; and
    (5) Offering such other guidance as necessary for the effective 
implementation and administration of the governmentwide system.
    (c) These regulations also implement Executive Order 12689 (3 CFR, 
1989 Comp., p. 235) and 31 U.S.C. 6101 note (Public Law 103-355, sec. 
2455, 108 Stat. 3327) by--
    (1) Providing for the inclusion in the List of Parties Excluded from 
Federal Procurement and Nonprocurement Programs all persons proposed for 
debarment, debarred or suspended under the Federal Acquisition 
Regulation, 48 CFR Part 9, subpart 9.4; persons against which 
governmentwide exclusions have been entered under this part; and persons 
determined to be ineligible; and
    (2) Setting forth the consequences of a debarment, suspension, 
determination of ineligibility, or voluntary exclusion.
    (d) Although these regulations cover the listing of ineligible 
participants and the effect of such listing, they do not prescribe 
policies and procedures governing declarations of ineligibility.

[60 FR 33040, 33052, June 26, 1995]



Sec. 19.105  Definitions.

    The following definitions apply to this part:
    Adequate evidence. Information sufficient to support the reasonable 
belief that a particular act or omission has occurred.
    Affiliate. Persons are affiliates of each other if, directly or 
indirectly, either one controls or has the power to control the other, 
or, a third person controls or has the power to control both. Indicia of 
control include, but are not limited to: interlocking management or 
ownership, identity of interests among family members, shared facilities 
and equipment, common use of employees, or a business entity organized 
following the suspension or debarment of a person which has the same or 
similar management, ownership, or principal employees as the suspended, 
debarred, ineligible, or voluntarily excluded person.
    Agency. Any executive department, military department or defense 
agency or other agency of the executive branch, excluding the 
independent regulatory agencies.
    Civil judgment. The disposition of a civil action by any court of 
competent jurisdiction, whether entered by verdict, decision, 
settlement, stipulation, or otherwise creating a civil liability for the 
wrongful acts complained of; or a final determination of liability under 
the Program Fraud Civil Remedies Act of 1988 (31 U.S.C. 3801-12).

[[Page 255]]

    Conviction. A judgment or conviction of a criminal offense by any 
court of competent jurisdiction, whether entered upon a verdict or a 
plea, including a plea of nolo contendere.
    Debarment. An action taken by a debarring official in accordance 
with these regulations to exclude a person from participating in covered 
transactions. A person so excluded is ``debarred.''
    Debarring official. An official authorized to impose debarment. The 
debarring official is either:
    (1) The agency head, or
    (2) An official designated by the agency head.
    Indictment. Indictment for a criminal offense. An information or 
other filing by competent authority charging a criminal offense shall be 
given the same effect as an indictment.
    Ineligible. Excluded from participation in Federal nonprocurement 
programs pursuant to a determination of ineligibility under statutory, 
executive order, or regulatory authority, other than Executive Order 
12549 and its agency implementing regulations; for exemple, excluded 
pursuant to the Davis-Bacon Act and its implementing regulations, the 
equal employment opportunity acts and executive orders, or the 
environmental protection acts and executive orders. A person is 
ineligible where the determination of ineligibility affects such 
person's eligibility to participate in more than one covered 
transaction.
    Legal proceedings. Any criminal proceeding or any civil judicial 
proceeding to which the Federal Government or a State or local 
government or quasi-governmental authority is a party. The term includes 
appeals from such proceedings.
    List of Parties Excluded from Federal Procurement and Nonprocurement 
Programs. A list compiled, maintained and distributed by the General 
Services Administration (GSA) containing the names and other information 
about persons who have been debarred, suspended, or voluntarily excluded 
under Executive Orders 12549 and 12689 and these regulations or 48 CFR 
part 9, subpart 9.4, persons who have been proposed for debarment under 
48 CFR part 9, subpart 9.4, and those persons who have been determined 
to be ineligible.
    Notice. A written communication served in person or sent by 
certified mail, return receipt requested, or its equivalent, to the last 
known address of a party, its identified counsel, its agent for service 
of process, or any partner, officer, director, owner, or joint venturer 
of the party. Notice, if undeliverable, shall be considered to have been 
received by the addressee five days after being properly sent to the 
last address known by the agency.
    Participant. Any person who submits a proposal for, enters into, or 
reasonably may be expected to enter into a covered transaction. This 
term also includes any person who acts on behalf of or is authorized to 
commit a participant in a covered transaction as an agent or 
representative of another participant.
    Person. Any individual, corporation, partnership, association, unit 
of government or legal entity, however organized, except: foreign 
governments or foreign governmental entities, public international 
organizations, foreign government owned (in whole or in part) or 
controlled entities, and entities consisting wholly or partially of 
foreign governments or foreign governmental entities.
    Preponderance of the evidence. Proof by information that, compared 
with that opposing it, leads to the conclusion that the fact at issue is 
more probably true than not.
    Principal. Officer, director, owner, partner, key employee, or other 
person within a participant with primary management or supervisory 
responsibilities; or a person who has a critical influence on or 
substantive control over a covered transaction, whether or not employed 
by the participant. Persons who have a critical influence on or 
substantive control over a covered transaction are:
    (1) Principal investigators.
    (2) [Reserved]
    Proposal. A solicited or unsolicited bid, application, request, 
invitation to consider or similar communication by or on behalf of a 
person seeking to participate or to receive a benefit, directly or 
indirectly, in or under a covered transaction.

[[Page 256]]

    Respondent. A person against whom a debarment or suspension action 
has been initiated.
    State. Any of the States of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, any territory or possession 
of the United States, or any agency of a State, exclusive of 
institutions of higher education, hospitals, and units of local 
government. A State instrumentality will be considered part of the State 
government if it has a written determination from a State government 
that such State considers that instrumentality to be an agency of the 
State government.
    Suspending official. An official authorized to impose suspension. 
The suspending official is either:
    (1) The agency head, or
    (2) An official designated by the agency head.
    Suspension. An action taken by a suspending official in accordance 
with these regulations that immediately excludes a person from 
participating in covered transactions for a temporary period, pending 
completion of an investigation and such legal, debarment, or Program 
Fraud Civil Remedies Act proceedings as may ensue. A person so excluded 
is ``suspended.''
    Voluntary exclusion or voluntarily excluded. A status of 
nonparticipation or limited participation in covered transactions 
assumed by a person pursuant to the terms of a settlement.

[53 FR 19187, and 19204, May 26, 1988, Redesignated at 54 FR 4958, Jan. 
31, 1989; 60 FR 33041, 33052, June 26, 1995]



Sec. 19.110  Coverage.

    (a) These regulations apply to all persons who have participated, 
are currently participating or may reasonably be expected to participate 
in transactions under Federal nonprocurement programs. For purposes of 
these regulations such transactions will be referred to as ``covered 
transactions.''
    (1) Covered transaction. For purposes of these regulations, a 
covered transaction is a primary covered transaction or a lower tier 
covered transaction. Covered transactions at any tier need not involve 
the transfer of Federal funds.
    (i) Primary covered transaction. Except as noted in paragraph (a)(2) 
of this section, a primary covered transaction is any nonprocurement 
transaction between an agency and a person, regardless of type, 
including: grants, cooperative agreements, scholarships, fellowships, 
contracts of assistance, loans, loan guarantees, subsidies, insurance, 
payments for specified use, donation agreements and any other 
nonprocurement transactions between a Federal agency and a person. 
Primary covered transactions also include those transactions specially 
designated by the U.S. Department of Housing and Urban Development in 
such agency's regulations governing debarment and suspension.
    (ii) Lower tier covered transaction. A lower tier covered 
transaction is:
    (A) Any transaction between a participant and a person other than a 
procurement contract for goods or services, regardless of type, under a 
primary covered transaction.
    (B) Any procurement contract for goods or services between a 
participant and a person, regardless of type, expected to equal or 
exceed the Federal procurement small purchase threshold fixed at 10 
U.S.C. 2304(g) and 41 U.S.C. 253(g) (currently $25,000) under a primary 
covered transaction.
    (C) Any procurement contract for goods or services between a 
participant and a person under a covered transaction, regardless of 
amount, under which that person will have a critical influence on or 
substantive control over that covered transaction. Such persons are:
    (1) Principal investigators.
    (2) Providers of federally-required audit services.
    (2) Exceptions. The following transactions are not covered:
    (i) Statutory entitlements or mandatory awards (but not subtier 
awards thereunder which are not themselves mandatory), including 
deposited funds insured by the Federal Government;
    (ii) Direct awards to foreign governments or public international 
organizations, or transactions with foreign governments or foreign 
governmental entities, public international organizations, foreign 
government owned (in whole or in part) or controlled entities,

[[Page 257]]

entities consisting wholly or partially of foreign governments or 
foreign governmental entities;
    (iii) Benefits to an individual as a personal entitlement without 
regard to the individual's present responsibility (but benefits received 
in an individual's business capacity are not excepted);
    (iv) Federal employment;
    (v) Transactions pursuant to national or agency-recognized 
emergencies or disasters;
    (vi) Incidental benefits derived from ordinary governmental 
operations; and
    (vii) Other transactions where the application of these regulations 
would be prohibited by law.
    (b) Relationship to other sections. This section describes the types 
of transactions to which a debarment or suspension under the regulations 
will apply. Subpart B, ``Effect of Action,'' Sec. 19.200, ``Debarment or 
suspension,'' sets forth the consequences of a debarment or suspension. 
Those consequences would obtain only with respect to participants and 
principals in the covered transactions and activities described in 
Sec. 19.110(a). Sections 19.325, ``Scope of debarment,'' and 19.420, 
``Scope of suspension,'' govern the extent to which a specific 
participant or organizational elements of a participant would be 
automatically included within a debarment or suspension action, and the 
conditions under which affiliates or persons associated with a 
participant may also be brought within the scope of the action.
    (c) Relationship to Federal procurement activities. In accordance 
with E.O. 12689 and section 2455 of Public Law 103-355, any debarment, 
suspension, proposed debarment or other governmentwide exclusion 
initiated under the Federal Acquisition Regulation (FAR) on or after 
August 25, 1995 shall be recognized by and effective for Executive 
Branch agencies and participants as an exclusion under this regulation. 
Similarly, any debarment, suspension or other governmentwide exclusion 
initiated under this regulation on or after August 25, 1995 shall be 
recognized by and effective for those agencies as a debarment or 
suspension under the FAR.

[53 FR 19187, and 19204, May 26, 1988, Redesignated at 54 FR 4958, Jan. 
31, 1989; 60 FR 33041, 33052, June 26, 1995]



Sec. 19.115  Policy.

    (a) In order to protect the public interest, it is the policy of the 
Federal Government to conduct business only with responsible persons. 
Debarment and suspension are discretionary actions that, taken in 
accordance with Executive Order 12549 and these regulations, are 
appropriate means to implement this policy.
    (b) Debarment and suspension are serious actions which shall be used 
only in the public interest and for the Federal Government's protection 
and not for purposes of punishment. Agencies may impose debarment or 
suspension for the causes and in accordance with the procedures set 
forth in these regulations.
    (c) When more than one agency has an interest in the proposed 
debarment or suspension of a person, consideration shall be given to 
designating one agency as the lead agency for making the decision. 
Agencies are encouraged to establish methods and procedures for 
coordinating their debarment or suspension actions.



                       Subpart B--Effect of Action



Sec. 19.200  Debarment or suspension.

    (a) Primary covered transactions. Except to the extent prohibited by 
law, persons who are debarred or suspended shall be excluded from 
primary covered transactions as either participants or principals 
throughout the Executive Branch of the Federal Government for the period 
of their debarment, suspension, or the period they are proposed for 
debarment under 48 CFR part 9, subpart 9.4. Accordingly, no agency shall 
enter into primary covered transactions with such excluded persons 
during such period, except as permitted pursuant to Sec. 19.215.
    (b) Lower tier covered transactions. Except to the extent prohibited 
by law, persons who have been proposed for debarment under 48 CFR part 
9, subpart 9.4, debarred or suspended shall be excluded from 
participating as either participants or principals in all lower tier 
covered transactions (see Sec. 19.110(a)(1)(ii)) for the period of their 
exclusion.

[[Page 258]]

    (c) Exceptions. Debarment or suspension does not affect a person's 
eligibility for--
    (1) Statutory entitlements or mandatory awards (but not subtier 
awards thereunder which are not themselves mandatory), including 
deposited funds insured by the Federal Government;
    (2) Direct awards to foreign governments or public international 
organizations, or transactions with foreign governments or foreign 
governmental entities, public international organizations, foreign 
government owned (in whole or in part) or controlled entities, and 
entities consisting wholly or partially of foreign governments or 
foreign governmental entities;
    (3) Benefits to an individual as a personal entitlement without 
regard to the individual's present responsibility (but benefits received 
in an individual's business capacity are not excepted);
    (4) Federal employment;
    (5) Transactions pursuant to national or agency-recognized 
emergencies or disasters;
    (6) Incidental benefits derived from ordinary governmental 
operations; and
    (7) Other transactions where the application of these regulations 
would be prohibited by law.

[60 FR 33041, 33052, June 26, 1995]



Sec. 19.205  Ineligible persons.

    Persons who are ineligible, as defined in Sec. 19.105(i), are 
excluded in accordance with the applicable statutory, executive order, 
or regulatory authority.



Sec. 19.210  Voluntary exclusion.

    Persons who accept voluntary exclusions under Sec. 19.315 are 
excluded in accordance with the terms of their settlements. Department 
of the Treasury shall, and participants may, contact the original action 
agency to ascertain the extent of the exclusion.



Sec. 19.215  Exception provision.

    The Department of the Treasury may grant an exception permitting a 
debarred, suspended, or voluntarily excluded person, or a person 
proposed for debarment under 48 CFR part 9, subpart 9.4, to participate 
in a particular covered transaction upon a written determination by the 
agency head or an authorized designee stating the reason(s) for 
deviating from the Presidential policy established by Executive Order 
12549 and Sec. 19.200. However, in accordance with the President's 
stated intention in the Executive Order, exceptions shall be granted 
only infrequently. Exceptions shall be reported in accordance with 
Sec. 19.505(a).

[60 FR 33041, 33052, June 26, 1995]



Sec. 19.220  Continuation of covered transactions.

    (a) Notwithstanding the debarment, suspension, proposed debarment 
under 48 CFR part 9, subpart 9.4, determination of ineligibility, or 
voluntary exclusion of any person by an agency, agencies and 
participants may continue covered transactions in existence at the time 
the person was debarred, suspended, proposed for debarment under 48 CFR 
part 9, subpart 9.4, declared ineligible, or voluntarily excluded. A 
decision as to the type of termination action, if any, to be taken 
should be made only after thorough review to ensure the propriety of the 
proposed action.
    (b) Agencies and participants shall not renew or extend covered 
transactions (other than no-cost time extensions) with any person who is 
debarred, suspended, proposed for debarment under 48 CFR part 9, subpart 
9.4, ineligible or voluntary excluded, except as provided in 
Sec. 19.215.

[60 FR 33041, 33052, June 26, 1995]



Sec. 19.225  Failure to adhere to restrictions.

    (a) Except as permitted under Sec. 19.215 or Sec. 19.220, a 
participant shall not knowingly do business under a covered transaction 
with a person who is--
    (1) Debarred or suspended;
    (2) Proposed for debarment under 48 CFR part 9, subpart 9.4; or
    (3) Ineligible for or voluntarily excluded from the covered 
transaction.
    (b) Violation of the restriction under paragraph (a) of this section 
may result in disallowance of costs, annulment or termination of award, 
issuance of a stop work order, debarment or suspension, or other 
remedies as appropriate.

[[Page 259]]

    (c) A participant may rely upon the certification of a prospective 
participant in a lower tier covered transaction that it and its 
principals are not debarred, suspended, proposed for debarment under 48 
CFR part 9, subpart 9.4, ineligible, or voluntarily excluded from the 
covered transaction (See Appendix B of these regulations), unless it 
knows that the certification is erroneous. An agency has the burden of 
proof that a participant did knowingly do business with a person that 
filed an erroneous certification.

[60 FR 33041, 33052, June 26, 1995]



                          Subpart C--Debarment



Sec. 19.300  General.

    The debarring official may debar a person for any of the causes in 
Sec. 19.305, using procedures established in Secs. 19.310 through 
19.314. The existence of a cause for debarment, however, does not 
necessarily require that the person be debarred; the seriousness of the 
person's acts or omissions and any mitigating factors shall be 
considered in making any debarment decision.



Sec. 19.305  Causes for debarment.

    Debarment may be imposed in accordance with the provisions of 
Secs. 19.300 through 19.314 for:
    (a) Conviction of or civil judgment for:
    (1) Commission of fraud or a criminal offense in connection with 
obtaining, attempting to obtain, or performing a public or private 
agreement or transaction;
    (2) Violation of Federal or State antitrust statutes, including 
those proscribing price fixing between competitors, allocation of 
customers between competitors, and bid rigging;
    (3) Commission of embezzlement, theft, forgery, bribery, 
falsification or destruction of records, making false statements, 
receiving stolen property, making false claims, or obstruction of 
justice; or
    (4) Commission of any other offense indicating a lack of business 
integrity or business honesty that seriously and directly affects the 
present responsibility of a person.
    (b) Violation of the terms of a public agreement or transaction so 
serious as to affect the integrity of an agency program, such as:
    (1) A willful failure to perform in accordance with the terms of one 
or more public agreements or transactions;
    (2) A history of failure to perform or of unsatisfactory performance 
of one or more public agreements or transactions; or
    (3) A willful violation of a statutory or regulatory provision or 
requirement applicable to a public agreement or transaction.
    (c) Any of the following causes:
    (1) A nonprocurement debarment by any Federal agency taken before 
October 1, 1988, the effective date of these regulations, or a 
procurement debarment by any Federal agency taken pursuant to 48 CFR 
subpart 9.4;
    (2) Knowingly doing business with a debarred, suspended, ineligible, 
or voluntarily excluded person, in connection with a covered 
transaction, except as permitted in Sec. 19.215 or Sec. 19.220;
    (3) Failure to pay a single substantial debt, or a number of 
outstanding debts (including disallowed costs and overpayments, but not 
including sums owed the Federal Government under the Internal Revenue 
Code) owed to any Federal agency or instrumentality, provided the debt 
is uncontested by the debtor or, if contested, provided that the 
debtor's legal and administrative remedies have been exhausted;
    (4) Violation of a material provision of a voluntary exclusion 
agreement entered into under Sec. 19.315 or of any settlement of a 
debarment or suspension action; or
    (5) Violation of any requirement of subpart F of this part, relating 
to providing a drug-free workplace, as set forth in Sec. 19.615 of this 
part.
    (d) Any other cause of so serious or compelling a nature that it 
affects the present responsibility of a person.

[53 FR 19204, May 26, 1988, as amended at 54 FR 4950 and 4958, Jan. 31, 
1989]



Sec. 19.310  Procedures.

    Department of the Treasury shall process debarment actions as 
informally as practicable, consistent with the principles of fundamental 
fairness,

[[Page 260]]

using the procedures in Secs. 19.311 through 19.314.



Sec. 19.311  Investigation and referral.

    Information concerning the existence of a cause for debarment from 
any source shall be promptly reported, investigated, and referred, when 
appropriate, to the debarring official for consideration. After 
consideration, the debarring official may issue a notice of proposed 
debarment.



Sec. 19.312  Notice of proposed debarment.

    A debarment proceeding shall be initiated by notice to the 
respondent advising:
    (a) That debarment is being considered;
    (b) Of the reasons for the proposed debarment in terms sufficient to 
put the respondent on notice of the conduct or transaction(s) upon which 
it is based;
    (c) Of the cause(s) relied upon under Sec. 19.305 for proposing 
debarment;
    (d) Of the provisions of Sec. 19.311 through Sec. 19.314, and any 
other Department of the Treasury procedures, if applicable, governing 
debarment decisionmaking; and
    (e) Of the potential effect of a debarment.



Sec. 19.313  Opportunity to contest proposed debarment.

    (a) Submission in opposition. Within 30 days after receipt of the 
notice of proposed debarment, the respondent may submit, in person, in 
writing, or through a representative, information and argument in 
opposition to the proposed debarment.
    (b) Additional proceedings as to disputed material facts. (1) In 
actions not based upon a conviction or civil judgment, if the debarring 
official finds that the respondent's submission in opposition raises a 
genuine dispute over facts material to the proposed debarment, 
respondent(s) shall be afforded an opportunity to appear with a 
representative, submit documentary evidence, present witnesses, and 
confront any witness the agency presents.
    (2) A transcribed record of any additional proceedings shall be made 
available at cost to the respondent, upon request, unless the respondent 
and the agency, by mutual agreement, waive the requirement for a 
transcript.



Sec. 19.314  Debarring official's decision.

    (a) No additional proceedings necessary. In actions based upon a 
conviction or civil judgment, or in which there is no genuine dispute 
over material facts, the debarring official shall make a decision on the 
basis of all the information in the administrative record, including any 
submission made by the respondent. The decision shall be made within 45 
days after receipt of any information and argument submitted by the 
respondent, unless the debarring official extends this period for good 
cause.
    (b) Additional proceedings necessary. (1) In actions in which 
additional proceedings are necessary to determine disputed material 
facts, written findings of fact shall be prepared. The debarring 
official shall base the decision on the facts as found, together with 
any information and argument submitted by the respondent and any other 
information in the administrative record.
    (2) The debarring official may refer disputed material facts to 
another official for findings of fact. The debarring official may reject 
any such findings, in whole or in part, only after specifically 
determining them to be arbitrary and capricious or clearly erroneous.
    (3) The debarring official's decision shall be made after the 
conclusion of the proceedings with respect to disputed facts.
    (c) (1) Standard of proof. In any debarment action, the cause for 
debarment must be established by a preponderance of the evidence. Where 
the proposed debarment is based upon a conviction or civil judgment, the 
standard shall be deemed to have been met.
    (2) Burden of proof. The burden of proof is on the agency proposing 
debarment.
    (d) Notice of debarring official's decision. (1) If the debarring 
official decides to impose debarment, the respondent shall be given 
prompt notice:
    (i) Referring to the notice of proposed debarment;
    (ii) Specifying the reasons for debarment;

[[Page 261]]

    (iii) Stating the period of debarment, including effective dates; 
and
    (iv) Advising that the debarment is effective for covered 
transactions throughout the executive branch of the Federal Government 
unless an agency head or an authorized designee makes the determination 
referred to in Sec. 601.915.
    (2) If the debarring official decides not to impose debarment, the 
respondent shall be given prompt notice of that decision. A decision not 
to impose debarment shall be without prejudice to a subsequent 
imposition of debarment by any other agency.



Sec. 19.315  Settlement and voluntary exclusion.

    (a) When in the best interest of the Government, Department of the 
Treasury may, at any time, settle a debarment or suspension action.
    (b) If a participant and the agency agree to a voluntary exclusion 
of the participant, such voluntary exclusion shall be entered on the 
Nonprocurement List (see subpart E).



Sec. 19.320  Period of debarment.

    (a) Debarment shall be for a period commensurate with the 
seriousness of the cause(s). If a suspension precedes a debarment, the 
suspension period shall be considered in determining the debarment 
period.
    (1) Debarment for causes other than those related to a violation of 
the requirements of subpart F of this part generally should not exceed 
three years. Where circumstances warrant, a longer period of debarment 
may be imposed.
    (2) In the case of a debarment for a violation of the requirements 
of subpart F of this part (see 19.305(c)(5)), the period of debarment 
shall not exceed five years.
    (b) The debarring official may extend an existing debarment for an 
additional period, if that official determines that an extension is 
necessary to protect the public interest. However, a debarment may not 
be extended solely on the basis of the facts and circumstances upon 
which the initial debarment action was based. If debarment for an 
additional period is determined to be necessary, the procedures of 
Secs. 19.311 through 19.314 shall be followed to extend the debarment.
    (c) The respondent may request the debarring official to reverse the 
debarment decision or to reduce the period or scope of debarment. Such a 
request shall be in writing and supported by documentation. The 
debarring official may grant such a request for reasons including, but 
not limited to:
    (1) Newly discovered material evidence;
    (2) Reversal of the conviction or civil judgment upon which the 
debarment was based;
    (3) Bona fide change in ownership or management;
    (4) Elimination of other causes for which the debarment was imposed; 
or
    (5) Other reasons the debarring official deems appropriate.

[53 FR 19204, May 26, 1988, as amended at 54 FR 4950 and 4958, Jan. 31, 
1989]



Sec. 19.325  Scope of debarment.

    (a) Scope in general. (1) Debarment of a person under these 
regulations constitutes debarment of all its divisions and other 
organizational elements from all covered transactions, unless the 
debarment decision is limited by its terms to one or more specifically 
identified individuals, divisions or other organizational elements or to 
specific types of transactions.
    (2) The debarment action may include any affiliate of the 
participant that is specifically named and given notice of the proposed 
debarment and an opportunity to respond (see Secs. 19.311 through 
19.314).
    (b) Imputing conduct. For purposes of determining the scope of 
debarment, conduct may be imputed as follows:
    (1) Conduct imputed to participant. The fraudulent, criminal or 
other seriously improper conduct of any officer, director, shareholder, 
partner, employee, or other individual associated with a participant may 
be imputed to the participant when the conduct occurred in connection 
with the individual's performance of duties for or on behalf of the 
participant, or with the participant's knowledge, approval, or 
acquiescence. The participant's acceptance of the benefits derived from 
the conduct shall be evidence of such knowledge, approval, or 
acquiescence.

[[Page 262]]

    (2) Conduct imputed to individuals associated with participant. The 
fraudulent, criminal, or other seriously improper conduct of a 
participant may be imputed to any officer, director, shareholder, 
partner, employee, or other individual associated with the participant 
who participated in, knew of, or had reason to know of the participant's 
conduct.
    (3) Conduct of one participant imputed to other participants in a 
joint venture. The fraudulent, criminal, or other seriously improper 
conduct of one participant in a joint venture, grant pursuant to a joint 
application, or similar arrangement may be imputed to other participants 
if the conduct occurred for or on behalf of the joint venture, grant 
pursuant to a joint application, or similar arrangement may be imputed 
to other participants if the conduct occurred for or on behalf of the 
joint venture, grant pursuant to a joint application, or similar 
arrangement or with the knowledge, approval, or acquiescence of these 
participants. Acceptance of the benefits derived from the conduct shall 
be evidence of such knowledge, approval, or acquiescence.



                          Subpart D--Suspension



Sec. 19.400  General.

    (a) The suspending official may suspend a person for any of the 
causes in Sec. 19.405 using procedures established in Secs. 19.410 
through 19.413.
    (b) Suspension is a serious action to be imposed only when:
    (1) There exists adequate evidence of one or more of the causes set 
out in Sec. 19.405, and
    (2) Immediate action is necessary to protect the public interest.
    (c) In assessing the adequacy of the evidence, the agency should 
consider how much information is available, how credible it is given the 
circumstances, whether or not important allegations are corroborated, 
and what inferences can reasonably be drawn as a result. This assessment 
should include an examination of basic documents such as grants, 
cooperative agreements, loan authorizations, and contracts.



Sec. 19.405  Causes for suspension.

    (a) Suspension may be imposed in accordance with the provisions of 
Secs. 19.400 through 19.413 upon adequate evidence:
    (1) To suspect the commission of an offense listed in 
Sec. 19.405(a); or
    (2) That a cause for debarment under Sec. 19.305 may exist.
    (b) Indictment shall constitute adequate evidence for purposes of 
suspension actions.



Sec. 19.410  Procedures.

    (a) Investigation and referral. Information concerning the existence 
of a cause for suspension from any source shall be promptly reported, 
investigated, and referred, when appropriate, to the suspending official 
for consideration. After consideration, the suspending official may 
issue a notice of suspension.
    (b) Decisionmaking process. Department of the Treasury shall process 
suspension actions as informally as practicable, consistent with 
principles of fundamental fairness, using the procedures in Sec. 19.411 
through Sec. 19.413.



Sec. 19.411  Notice of suspension.

    When a respondent is suspended, notice shall immediately be given:
    (a) That suspension has been imposed;
    (b) That the suspension is based on an indictment, conviction, or 
other adequate evidence that the respondent has committed irregularities 
seriously reflecting on the propriety of further Federal Government 
dealings with the respondent;
    (c) Describing any such irregularities in terms sufficient to put 
the respondent on notice without disclosing the Federal Government's 
evidence;
    (d) Of the cause(s) relied upon under Sec. 19.405 for imposing 
suspension;
    (e) That the suspension is for a temporary period pending the 
completion of an investigation or ensuing legal, debarment, or Program 
Fraud Civil Remedies Act proceedings;
    (f) Of the provisions of Sec. 19.411 through Sec. 19.413 and any 
other Department of the Treasury procedures, if applicable, governing 
suspension decisionmaking; and
    (g) Of the effect of the suspension.

[[Page 263]]



Sec. 19.412  Opportunity to contest suspension.

    (a) Submission in opposition. Within 30 days after receipt of the 
notice of suspension, the respondent may submit, in person, in writing, 
or through a representative, information and argument in opposition to 
the suspension.
    (b) Additional proceedings as to disputed material facts. (1) If the 
suspending official finds that the respondent's submission in opposition 
raises a genuine dispute over facts material to the suspension, 
respondent(s) shall be afforded an opportunity to appear with a 
representative, submit documentary evidence, present witnesses, and 
confront any witness the agency presents, unless:
    (i) The action is based on an indictment, conviction or civil 
judgment, or
    (ii) A determination is made, on the basis of Department of Justice 
advice, that the substantial interests of the Federal Government in 
pending or contemplated legal proceedings based on the same facts as the 
suspension would be prejudiced.
    (2) A transcribed record of any additional proceedings shall be 
prepared and made available at cost to the respondent, upon request, 
unless the respondent and the agency, by mutual agreement, waive the 
requirement for a transcript.



Sec. 19.413  Suspending official's decision.

    The suspending official may modify or terminate the suspension (for 
example, see Sec. 19.320(c) for reasons for reducing the period or scope 
of debarment) or may leave it in force. However, a decision to modify or 
terminate the suspension shall be without prejudice to the subsequent 
imposition of suspension by any other agency or debarment by any agency. 
The decision shall be rendered in accordance with the following 
provisions:
    (a) No additional proceedings necessary. In actions: based on an 
indictment, conviction, or civil judgment; in which there is no genuine 
dispute over material facts; or in which additional proceedings to 
determine disputed material facts have been denied on the basis of 
Department of Justice advice, the suspending official shall make a 
decision on the basis of all the information in the administrative 
record, including any submission made by the respondent. The decision 
shall be made within 45 days after receipt of any information and 
argument submitted by the respondent, unless the suspending official 
extends this period for good cause.
    (b) Additional proceedings necessary. (1) In actions in which 
additional proceedings are necessary to determine disputed material 
facts, written findings of fact shall be prepared. The suspending 
official shall base the decision on the facts as found, together with 
any information and argument submitted by the respondent and any other 
information in the administrative record.
    (2) The suspending official may refer matters involving disputed 
material facts to another official for findings of fact. The suspending 
official may reject any such findings, in whole or in part, only after 
specifically determining them to be arbitrary or capricious or clearly 
erroneous.
    (c) Notice of suspending official's decision. Prompt written notice 
of the suspending official's decision shall be sent to the respondent.



Sec. 19.415  Period of suspension.

    (a) Suspension shall be for a temporary period pending the 
completion of an investigation or ensuing legal, debarment, or Program 
Fraud Civil Remedies Act proceedings, unless terminated sooner by the 
suspending official or as provided in paragraph (b) of this section.
    (b) If legal or administrative proceedings are not initiated within 
12 months after the date of the suspension notice, the suspension shall 
be terminated unless an Assistant Attorney General or United States 
Attorney requests its extension in writing, in which case it may be 
extended for an additional six months. In no event may a suspension 
extend beyond 18 months, unless such proceedings have been initiated 
within that period.
    (c) The suspending official shall notify the Department of Justice 
of an impending termination of a suspension, at least 30 days before the 
12-month period expires, to give that Department an opportunity to 
request an extension.

[[Page 264]]



Sec. 19.420  Scope of suspension.

    The scope of a suspension is the same as the scope of a debarment 
(see Sec. 19.325), except that the procedures of Secs. 19.410 through 
19.413 shall be used in imposing a suspension.



       Subpart E--Responsibilities of GSA, Agency and Participants



Sec. 19.500  GSA responsibilities.

    (a) In accordance with the OMB guidelines, GSA shall compile, 
maintain, and distribute a list of all persons who have been debarred, 
suspended, or voluntarily excluded by agencies under Executive Order 
12549 and these regulations, and those who have been determined to be 
ineligible.
    (b) At a minimum, this list shall indicate:
    (1) The names and addresses of all debarred, suspended, ineligible, 
and voluntarily excluded persons, in alphabetical order, with cross-
references when more than one name is involved in a single action;
    (2) The type of action;
    (3) The cause for the action;
    (4) The scope of the action;
    (5) Any termination date for each listing; and
    (6) The agency and name and telephone number of the agency point of 
contact for the action.



Sec. 19.505  Department of the Treasury responsibilities.

    (a) The agency shall provide GSA with current information concerning 
debarments, suspension, determinations of ineligibility, and voluntary 
exclusions it has taken. Until February 18, 1989, the agency shall also 
provide GSA and OMB with information concerning all transactions in 
which Department of the Treasury has granted exceptions under 
Sec. 19.215 permitting participation by debarred, suspended, or 
voluntarily excluded persons.
    (b) Unless an alternative schedule is agreed to by GSA, the agency 
shall advise GSA of the information set forth in Sec. 19.200(b) and of 
the exceptions granted under Sec. 19.215 within five working days after 
taking such actions.
    (c) The agency shall direct inquiries concerning listed persons to 
the agency that took the action.
    (d) Agency officials shall check the Nonprocurement List before 
entering covered transactions to determine whether a participant in a 
primary transaction is debarred, suspended, ineligible, or voluntarily 
excluded (Tel. ).
    (e) Agency officials shall check the Nonprocurement List before 
approving principals or lower tier participants where agency approval of 
the principal or lower tier participant is required under the terms of 
the transaction, to determine whether such principals or participants 
are debarred, suspended, ineligible, or voluntarily excluded.



Sec. 19.510  Participants' responsibilities.

    (a) Certification by participants in primary covered transactions. 
Each participant shall submit the certification in Appendix A to this 
part for it and its principals at the time the participant submits its 
proposal in connection with a primary covered transaction, except that 
States need only complete such certification as to their principals. 
Participants may decide the method and frequency by which they determine 
the eligibility of their principals. In addition, each participant may, 
but is not required to, check the Nonprocurement List for its principals 
(Tel. ). Adverse information on the certification will not necessarily 
result in denial of participation. However, the certification, and any 
additional information pertaining to the certification submitted by the 
participant, shall be considered in the administration of covered 
transactions.
    (b) Certification by participants in lower tier covered 
transactions. (1) Each participant shall require participants in lower 
tier covered transactions to include the certification in Appendix B to 
this part for it and its principals in any proposal submitted in 
connection with such lower tier covered transactions.
    (2) A participant may rely upon the certification of a prospective 
participant in a lower tier covered transaction that it and its 
principals are not debarred, suspended, ineligible, or voluntarily 
excluded from the covered

[[Page 265]]

transaction by any Federal agency, unless it knows that the 
certification is erroneous. Participants may decide the method and 
frequency by which they determine the eligiblity of their principals. In 
addition, a participant may, but is not required to, check the 
Nonprocurement List for its principals and for participants (Tel. ).
    (c) Changed circumstances regarding certification. A participant 
shall provide immediate written notice to Department of the Treasury if 
at any time the participant learns that its certification was erroneous 
when submitted or has become erroneous by reason of changed 
circumstances. Participants in lower tier covered transactions shall 
provide the same updated notice to the participant to which it submitted 
its proposals.



          Subpart F--Drug-Free Workplace Requirements (Grants)

    Source: 55 FR 21688, 21697, May 25, 1990, unless otherwise noted.



Sec. 19.600  Purpose.

    (a) The purpose of this subpart is to carry out the Drug-Free 
Workplace Act of 1988 by requiring that--
    (1) A grantee, other than an individual, shall certify to the agency 
that it will provide a drug-free workplace;
    (2) A grantee who is an individual shall certify to the agency that, 
as a condition of the grant, he or she will not engage in the unlawful 
manufacture, distribution, dispensing, possession or use of a controlled 
substance in conducting any activity with the grant.
    (b) Requirements implementing the Drug-Free Workplace Act of 1988 
for contractors with the agency are found at 48 CFR subparts 9.4, 23.5, 
and 52.2.



Sec. 19.605  Definitions.

    (a) Except as amended in this section, the definitions of 
Sec. 19.105 apply to this subpart.
    (b) For purposes of this subpart--
    (1) Controlled substance means a controlled substance in schedules I 
through V of the Controlled Substances Act (21 U.S.C. 812), and as 
further defined by regulation at 21 CFR 1308.11 through 1308.15;
    (2) Conviction means a finding of guilt (including a plea of nolo 
contendere) or imposition of sentence, or both, by any judicial body 
charged with the responsibility to determine violations of the Federal 
or State criminal drug statutes;
    (3) Criminal drug statute means a Federal or non-Federal criminal 
statute involving the manufacture, distribution, dispensing, use, or 
possession of any controlled substance;
    (4) Drug-free workplace means a site for the performance of work 
done in connection with a specific grant at which employees of the 
grantee are prohibited from engaging in the unlawful manufacture, 
distribution, dispensing, possession, or use of a controlled substance;
    (5) Employee means the employee of a grantee directly engaged in the 
performance of work under the grant, including:
    (i) All direct charge employees;
    (ii) All indirect charge employees, unless their impact or 
involvement is insignificant to the performance of the grant; and,
    (iii) Temporary personnel and consultants who are directly engaged 
in the performance of work under the grant and who are on the grantee's 
payroll.

This definition does not include workers not on the payroll of the 
grantee (e.g., volunteers, even if used to meet a matching requirement; 
consultants or independent contractors not on the payroll; or employees 
of subrecipients or subcontractors in covered workplaces);
    (6) Federal agency or agency means any United States executive 
department, military department, government corporation, government 
controlled corporation, any other establishment in the executive branch 
(including the Executive Office of the President), or any independent 
regulatory agency;
    (7) Grant means an award of financial assistance, including a 
cooperative agreement, in the form of money, or property in lieu of 
money, by a Federal agency directly to a grantee. The term grant 
includes block grant and entitlement grant programs, whether or not 
exempted from coverage under the

[[Page 266]]

grants management government-wide common rule on uniform administrative 
requirements for grants and cooperative agreements. The term does not 
include technical assistance that provides services instead of money, or 
other assistance in the form of loans, loan guarantees, interest 
subsidies, insurance, or direct appropriations; or any veterans' 
benefits to individuals, i.e., any benefit to veterans, their families, 
or survivors by virtue of the service of a veteran in the Armed Forces 
of the United States;
    (8) Grantee means a person who applies for or receives a grant 
directly from a Federal agency (except another Federal agency);
    (9) Individual means a natural person;
    (10) State means any of the States of the United States, the 
District of Columbia, the Commonwealth of Puerto Rico, any territory or 
possession of the United States, or any agency of a State, exclusive of 
institutions of higher education, hospitals, and units of local 
government. A State instrumentality will be considered part of the State 
government if it has a written determination from a State government 
that such State considers the instrumentality to be an agency of the 
State government.



Sec. 19.610  Coverage.

    (a) This subpart applies to any grantee of the agency.
    (b) This subpart applies to any grant, except where application of 
this subpart would be inconsistent with the international obligations of 
the United States or the laws or regulations of a foreign government. A 
determination of such inconsistency may be made only by the agency head 
or his/her designee.
    (c) The provisions of subparts A, B, C, D and E of this part apply 
to matters covered by this subpart, except where specifically modified 
by this subpart. In the event of any conflict between provisions of this 
subpart and other provisions of this part, the provisions of this 
subpart are deemed to control with respect to the implementation of 
drug-free workplace requirements concerning grants.



Sec. 19.615  Grounds for suspension of payments, suspension or termination of grants, or suspension or debarment.

    A grantee shall be deemed in violation of the requirements of this 
subpart if the agency head or his or her official designee determines, 
in writing, that--
    (a) The grantee has made a false certification under Sec. 19.630;
    (b) With respect to a grantee other than an individual--
    (1) The grantee has violated the certification by failing to carry 
out the requirements of paragraphs (A)(a) through (g) and/or (B) of the 
certification (Alternate I to Appendix C) or
    (2) Such a number of employees of the grantee have been convicted of 
violations of criminal drug statutes for violations occurring in the 
workplace as to indicate that the grantee has failed to make a good 
faith effort to provide a drug-free workplace.
    (c) With respect to a grantee who is an individual--
    (1) The grantee has violated the certification by failing to carry 
out its requirements (Alternate II to Appendix C); or
    (2) The grantee is convicted of a criminal drug offense resulting 
from a violation occurring during the conduct of any grant activity.



Sec. 19.620  Effect of violation.

    (a) In the event of a violation of this subpart as provided in 
Sec. 19.615, and in accordance with applicable law, the grantee shall be 
subject to one or more of the following actions:
    (1) Suspension of payments under the grant;
    (2) Suspension or termination of the grant; and
    (3) Suspension or debarment of the grantee under the provisions of 
this part.
    (b) Upon issuance of any final decision under this part requiring 
debarment of a grantee, the debarred grantee shall be ineligible for 
award of any grant from any Federal agency for a period specified in the 
decision, not to exceed five years (see Sec. 19.320(a)(2) of this part).

[[Page 267]]



Sec. 19.625  Exception provision.

    The agency head may waive with respect to a particular grant, in 
writing, a suspension of payments under a grant, suspension or 
termination of a grant, or suspension or debarment of a grantee if the 
agency head determines that such a waiver would be in the public 
interest. This exception authority cannot be delegated to any other 
official.



Sec. 19.630  Certification requirements and procedures.

    (a)(1) As a prior condition of being awarded a grant, each grantee 
shall make the appropriate certification to the Federal agency providing 
the grant, as provided in Appendix C to this part.
    (2) Grantees are not required to make a certification in order to 
continue receiving funds under a grant awarded before March 18, 1989, or 
under a no-cost time extension of such a grant. However, the grantee 
shall make a one-time drug-free workplace certification for a non-
automatic continuation of such a grant made on or after March 18, 1989.
    (b) Except as provided in this section, all grantees shall make the 
required certification for each grant. For mandatory formula grants and 
entitlements that have no application process, grantees shall submit a 
one-time certification in order to continue receiving awards.
    (c) A grantee that is a State may elect to make one certification in 
each Federal fiscal year. States that previously submitted an annual 
certification are not required to make a certification for Fiscal Year 
1990 until June 30, 1990. Except as provided in paragraph (d) of this 
section, this certification shall cover all grants to all State agencies 
from any Federal agency. The State shall retain the original of this 
statewide certification in its Governor's office and, prior to grant 
award, shall ensure that a copy is submitted individually with respect 
to each grant, unless the Federal agency has designated a central 
location for submission.
    (d)(1) The Governor of a State may exclude certain State agencies 
from the statewide certification and authorize these agencies to submit 
their own certifications to Federal agencies. The statewide 
certification shall name any State agencies so excluded.
    (2) A State agency to which the statewide certification does not 
apply, or a State agency in a State that does not have a statewide 
certification, may elect to make one certification in each Federal 
fiscal year. State agencies that previously submitted a State agency 
certification are not required to make a certification for Fiscal Year 
1990 until June 30, 1990. The State agency shall retain the original of 
this State agency-wide certification in its central office and, prior to 
grant award, shall ensure that a copy is submitted individually with 
respect to each grant, unless the Federal agency designates a central 
location for submission.
    (3) When the work of a grant is done by more than one State agency, 
the certification of the State agency directly receiving the grant shall 
be deemed to certify compliance for all workplaces, including those 
located in other State agencies.
    (e)(1) For a grant of less than 30 days performance duration, 
grantees shall have this policy statement and program in place as soon 
as possible, but in any case by a date prior to the date on which 
performance is expected to be completed.
    (2) For a grant of 30 days or more performance duration, grantees 
shall have this policy statement and program in place within 30 days 
after award.
    (3) Where extraordinary circumstances warrant for a specific grant, 
the grant officer may determine a different date on which the policy 
statement and program shall be in place.



Sec. 19.635  Reporting of and employee sanctions for convictions of criminal drug offenses.

    (a) When a grantee other than an individual is notified that an 
employee has been convicted for a violation of a criminal drug statute 
occurring in the workplace, it shall take the following actions:
    (1) Within 10 calendar days of receiving notice of the conviction, 
the grantee shall provide written notice, including the convicted 
employee's position

[[Page 268]]

title, to every grant officer, or other designee on whose grant activity 
the convicted employee was working, unless a Federal agency has 
designated a central point for the receipt of such notifications. 
Notification shall include the identification number(s) for each of the 
Federal agency's affected grants.
    (2) Within 30 calendar days of receiving notice of the conviction, 
the grantee shall do the following with respect to the employee who was 
convicted.
    (i) Take appropriate personnel action against the employee, up to 
and including termination, consistent with requirements of the 
Rehabilitation Act of 1973, as amended; or
    (ii) Require the employee to participate satisfactorily in a drug 
abuse assistance or rehabilitation program approved for such purposes by 
a Federal, State, or local health, law enforcement, or other appropriate 
agency.
    (b) A grantee who is an individual who is convicted for a violation 
of a criminal drug statute occurring during the conduct of any grant 
activity shall report the conviction, in writing, within 10 calendar 
days, to his or her Federal agency grant officer, or other designee, 
unless the Federal agency has designated a central point for the receipt 
of such notices. Notification shall include the identification number(s) 
for each of the Federal agency's affected grants.

(Approved by the Office of Management and Budget under control number 
0991-0002)

                          Appendices to part 19

 Appendix A to Part 19--Certification Regarding Debarment, Suspension, 
     and Other Responsibility Matters--Primary Covered Transactions

                     Instructions for Certification

    1. By signing and submitting this proposal, the prospective primary 
participant is providing the certification set out below.
    2. The inability of a person to provide the certification required 
below will not necessarily result in denial of participation in this 
covered transaction. The prospective participant shall submit an 
explanation of why it cannot provide the certification set out below. 
The certification or explanation will be considered in connection with 
the department or agency's determination whether to enter into this 
transaction. However, failure of the prospective primary participant to 
furnish a certification or an explanation shall disqualify such person 
from participation in this transaction.
    3. The certification in this clause is a material representation of 
fact upon which reliance was placed when the department or agency 
determined to enter into this transaction. If it is later determined 
that the prospective primary participant knowingly rendered an erroneous 
certification, in addition to other remedies available to the Federal 
Government, the department or agency may terminate this transaction for 
cause or default.
    4. The prospective primary participant shall provide immediate 
written notice to the department or agency to which this proposal is 
submitted if at any time the prospective primary participant learns that 
its certification was erroneous when submitted or has become erroneous 
by reason of changed circumstances.
    5. The terms covered transaction, debarred, suspended, ineligible, 
lower tier covered transaction, participant, person, primary covered 
transaction, principal, proposal, and voluntarily excluded, as used in 
this clause, have the meanings set out in the Definitions and Coverage 
sections of the rules implementing Executive Order 12549. You may 
contact the department or agency to which this proposal is being 
submitted for assistance in obtaining a copy of those regulations.
    6. The prospective primary participant agrees by submitting this 
proposal that, should the proposed covered transaction be entered into, 
it shall not knowingly enter into any lower tier covered transaction 
with a person who is proposed for debarment under 48 CFR part 9, subpart 
9.4, debarred, suspended, declared ineligible, or voluntarily excluded 
from participation in this covered transaction, unless authorized by the 
department or agency entering into this transaction.
    7. The prospective primary participant further agrees by submitting 
this proposal that it will include the clause titled ``Certification 
Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion-
Lower Tier Covered Transaction,'' provided by the department or agency 
entering into this covered transaction, without modification, in all 
lower tier covered transactions and in all solicitations for lower tier 
covered transactions.
    8. A participant in a covered transaction may rely upon a 
certification of a prospective participant in a lower tier covered 
transaction that it is not proposed for debarment under 48 CFR part 9, 
subpart 9.4, debarred, suspended, ineligible, or voluntarily excluded 
from the covered transaction, unless it knows that the certification is 
erroneous. A participant may decide the

[[Page 269]]

method and frequency by which it determines the eligibility of its 
principals. Each participant may, but is not required to, check the List 
of Parties Excluded from Federal Procurement and Nonprocurement 
Programs.
    9. Nothing contained in the foregoing shall be construed to require 
establishment of a system of records in order to render in good faith 
the certification required by this clause. The knowledge and information 
of a participant is not required to exceed that which is normally 
possessed by a prudent person in the ordinary course of business 
dealings.
    10. Except for transactions authorized under paragraph 6 of these 
instructions, if a participant in a covered transaction knowingly enters 
into a lower tier covered transaction with a person who is proposed for 
debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, 
ineligible, or voluntarily excluded from participation in this 
transaction, in addition to other remedies available to the Federal 
Government, the department or agency may terminate this transaction for 
cause or default.

Certification Regarding Debarment, Suspension, and Other Responsibility 
                  Matters--Primary Covered Transactions

    (1) The prospective primary participant certifies to the best of its 
knowledge and belief, that it and its principals:
    (a) Are not presently debarred, suspended, proposed for debarment, 
declared ineligible, or voluntarily excluded by any Federal department 
or agency;
    (b) Have not within a three-year period preceding this proposal been 
convicted of or had a civil judgment rendered against them for 
commission of fraud or a criminal offense in connection with obtaining, 
attempting to obtain, or performing a public (Federal, State or local) 
transaction or contract under a public transaction; violation of Federal 
or State antitrust statutes or commission of embezzlement, theft, 
forgery, bribery, falsification or destruction of records, making false 
statements, or receiving stolen property;
    (c) Are not presently indicted for or otherwise criminally or 
civilly charged by a governmental entity (Federal, State or local) with 
commission of any of the offenses enumerated in paragraph (1)(b) of this 
certification; and
    (d) Have not within a three-year period preceding this application/
proposal had one or more public transactions (Federal, State or local) 
terminated for cause or default.
    (2) Where the prospective primary participant is unable to certify 
to any of the statements in this certification, such prospective 
participant shall attach an explanation to this proposal.

[60 FR 33042, 33052, June 26, 1995]

 Appendix B to Part 19--Certification Regarding Debarment, Suspension, 
 Ineligibility and Voluntary Exclusion--Lower Tier Covered Transactions

                     Instructions for Certification

    1. By signing and submitting this proposal, the prospective lower 
tier participant is providing the certification set out below.
    2. The certification in this clause is a material representation of 
fact upon which reliance was placed when this transaction was entered 
into. If it is later determined that the prospective lower tier 
participant knowingly rendered an erroneous certification, in addition 
to other remedies available to the Federal Government the department or 
agency with which this transaction originated may pursue available 
remedies, including suspension and/or debarment.
    3. The prospective lower tier participant shall provide immediate 
written notice to the person to which this proposal is submitted if at 
any time the prospective lower tier participant learns that its 
certification was erroneous when submitted or had become erroneous by 
reason of changed circumstances.
    4. The terms covered transaction, debarred, suspended, ineligible, 
lower tier covered transaction, participant, person, primary covered 
transaction, principal, proposal, and voluntarily excluded, as used in 
this clause, have the meaning set out in the Definitions and Coverage 
sections of rules implementing Executive Order 12549. You may contact 
the person to which this proposal is submitted for assistance in 
obtaining a copy of those regulations.
    5. The prospective lower tier participant agrees by submitting this 
proposal that, should the proposed covered transaction be entered into, 
it shall not knowingly enter into any lower tier covered transaction 
with a person who is proposed for debarment under 48 CFR part 9, subpart 
9.4, debarred, suspended, declared ineligible, or voluntarily excluded 
from participation in this covered transaction, unless authorized by the 
department or agency with which this transaction originated.
    6. The prospective lower tier participant further agrees by 
submitting this proposal that it will include this clause titled 
``Certification Regarding Debarment, Suspension, Ineligibility and 
Voluntary Exclusion-Lower Tier Covered Transaction,'' without 
modification, in all lower tier covered transactions and in all 
solicitations for lower tier covered transactions.

[[Page 270]]

    7. A participant in a covered transaction may rely upon a 
certification of a prospective participant in a lower tier covered 
transaction that it is not proposed for debarment under 48 CFR part 9, 
subpart 9.4, debarred, suspended, ineligible, or voluntarily excluded 
from covered transactions, unless it knows that the certification is 
erroneous. A participant may decide the method and frequency by which it 
determines the eligibility of its principals. Each participant may, but 
is not required to, check the List of Parties Excluded from Federal 
Procurement and Nonprocurement Programs.
    8. Nothing contained in the foregoing shall be construed to require 
establishment of a system of records in order to render in good faith 
the certification required by this clause. The knowledge and information 
of a participant is not required to exceed that which is normally 
possessed by a prudent person in the ordinary course of business 
dealings.
    9. Except for transactions authorized under paragraph 5 of these 
instructions, if a participant in a covered transaction knowingly enters 
into a lower tier covered transaction with a person who is proposed for 
debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, 
ineligible, or voluntarily excluded from participation in this 
transaction, in addition to other remedies available to the Federal 
Government, the department or agency with which this transaction 
originated may pursue available remedies, including suspension and/or 
debarment.

    Certification Regarding Debarment, Suspension, Ineligibility an 
          Voluntary Exclusion--Lower Tier Covered Transactions

    (1) The prospective lower tier participant certifies, by submission 
of this proposal, that neither it nor its principals is presently 
debarred, suspended, proposed for debarment, declared ineligible, or 
voluntarily excluded from participation in this transaction by any 
Federal department or agency.
    (2) Where the prospective lower tier participant is unable to 
certify to any of the statements in this certification, such prospective 
participant shall attach an explanation to this proposal.

[60 FR 33042, 33052, June 26, 1995]

   Appendix C to Part 19--Certification Regarding Drug-Free Workplace 
                              Requirements

                     Instructions for Certification

    1. By signing and/or submitting this application or grant agreement, 
the grantee is providing the certification set out below.
    2. The certification set out below is a material representation of 
fact upon which reliance is placed when the agency awards the grant. If 
it is later determined that the grantee knowingly rendered a false 
certification, or otherwise violates the requirements of the Drug-Free 
Workplace Act, the agency, in addition to any other remedies available 
to the Federal Government, may take action authorized under the Drug-
Free Workplace Act.
    3. For grantees other than individuals, Alternate I applies.
    4. For grantees who are individuals, Alternate II applies.
    5. Workplaces under grants, for grantees other than individuals, 
need not be identified on the certification. If known, they may be 
identified in the grant application. If the grantee does not identify 
the workplaces at the time of application, or upon award, if there is no 
application, the grantee must keep the identity of the workplace(s) on 
file in its office and make the information available for Federal 
inspection. Failure to identify all known workplaces constitutes a 
violation of the grantee's drug-free workplace requirements.
    6. Workplace identifications must include the actual address of 
buildings (or parts of buildings) or other sites where work under the 
grant takes place. Categorical descriptions may be used (e.g., all 
vehicles of a mass transit authority or State highway department while 
in operation, State employees in each local unemployment office, 
performers in concert halls or radio studios).
    7. If the workplace identified to the agency changes during the 
performance of the grant, the grantee shall inform the agency of the 
change(s), if it previously identified the workplaces in question (see 
paragraph five).
    8. Definitions of terms in the Nonprocurement Suspension and 
Debarment common rule and Drug-Free Workplace common rule apply to this 
certification. Grantees' attention is called, in particular, to the 
following definitions from these rules:
    Controlled substance means a controlled substance in Schedules I 
through V of the Controlled Substances Act (21 U.S.C. 812) and as 
further defined by regulation (21 CFR 1308.11 through 1308.15);
    Conviction means a finding of guilt (including a plea of nolo 
contendere) or imposition of sentence, or both, by any judicial body 
charged with the responsibility to determine violations of the Federal 
or State criminal drug statutes;
    Criminal drug statute means a Federal or non-Federal criminal 
statute involving the manufacture, distribution, dispensing, use, or 
possession of any controlled substance;
    Employee means the employee of a grantee directly engaged in the 
performance of work under a grant, including: (i) All direct charge 
employees; (ii) All indirect charge employees unless their impact or 
involvement is insignificant to the performance of the grant;

[[Page 271]]

and, (iii) Temporary personnel and consultants who are directly engaged 
in the performance of work under the grant and who are on the grantee's 
payroll. This definition does not include workers not on the payroll of 
the grantee (e.g., volunteers, even if used to meet a matching 
requirement; consultants or independent contractors not on the grantee's 
payroll; or employees of subrecipients or subcontractors in covered 
workplaces).

        Certification Regarding Drug-Free Workplace Requirements

             Alternate I. (Grantees Other Than Individuals)

    A. The grantee certifies that it will or will continue to provide a 
drug-free workplace by:
    (a) Publishing a statement notifying employees that the unlawful 
manufacture, distribution, dispensing, possession, or use of a 
controlled substance is prohibited in the grantee's workplace and 
specifying the actions that will be taken against employees for 
violation of such prohibition;
    (b) Establishing an ongoing drug-free awareness program to inform 
employees about--
    (1) The dangers of drug abuse in the workplace;
    (2) The grantee's policy of maintaining a drug-free workplace;
    (3) Any available drug counseling, rehabilitation, and employee 
assistance programs; and
    (4) The penalties that may be imposed upon employees for drug abuse 
violations occurring in the workplace;
    (c) Making it a requirement that each employee to be engaged in the 
performance of the grant be given a copy of the statement required by 
paragraph (a);
    (d) Notifying the employee in the statement required by paragraph 
(a) that, as a condition of employment under the grant, the employee 
will--
    (1) Abide by the terms of the statement; and
    (2) Notify the employer in writing of his or her conviction for a 
violation of a criminal drug statute occurring in the workplace no later 
than five calendar days after such conviction;
    (e) Notifying the agency in writing, within ten calendar days after 
receiving notice under paragraph (d)(2) from an employee or otherwise 
receiving actual notice of such conviction. Employers of convicted 
employees must provide notice, including position title, to every grant 
officer or other designee on whose grant activity the convicted employee 
was working, unless the Federal agency has designated a central point 
for the receipt of such notices. Notice shall include the identification 
number(s) of each affected grant;
    (f) Taking one of the following actions, within 30 calendar days of 
receiving notice under paragraph (d)(2), with respect to any employee 
who is so convicted--
    (1) Taking appropriate personnel action against such an employee, up 
to and including termination, consistent with the requirements of the 
Rehabilitation Act of 1973, as amended; or
    (2) Requiring such employee to participate satisfactorily in a drug 
abuse assistance or rehabilitation program approved for such purposes by 
a Federal, State, or local health, law enforcement, or other appropriate 
agency;
    (g) Making a good faith effort to continue to maintain a drug-free 
workplace through implementation of paragraphs (a), (b), (c), (d), (e) 
and (f).
    B. The grantee may insert in the space provided below the site(s) 
for the performance of work done in connection with the specific grant:

Place of Performance (Street address, city, county, state, zip code)
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________

Check {time}  if there are workplaces on file that are not identified 
here.

              Alternate II. (Grantees Who Are Individuals)

    (a) The grantee certifies that, as a condition of the grant, he or 
she will not engage in the unlawful manufacture, distribution, 
dispensing, possession, or use of a controlled substance in conducting 
any activity with the grant;
    (b) If convicted of a criminal drug offense resulting from a 
violation occurring during the conduct of any grant activity, he or she 
will report the conviction, in writing, within 10 calendar days of the 
conviction, to every grant officer or other designee, unless the Federal 
agency designates a central point for the receipt of such notices. When 
notice is made to such a central point, it shall include the 
identification number(s) of each affected grant.

[55 FR 21690, 21697, May 25, 1990]



PART 21--NEW RESTRICTIONS ON LOBBYING--Table of Contents




                           Subpart A--General

Sec.
21.100  Conditions on use of funds.
21.105  Definitions.
21.110  Certification and disclosure.

[[Page 272]]

                 Subpart B--Activities by Own Employees

21.200  Agency and legislative liaison.
21.205  Professional and technical services.
21.210  Reporting.

            Subpart C--Activities by Other Than Own Employees

21.300  Professional and technical services.

                  Subpart D--Penalties and Enforcement

21.400  Penalties.
21.405  Penalty procedures.
21.410  Enforcement.

                          Subpart E--Exemptions

21.500  Secretary of Defense.

                        Subpart F--Agency Reports

21.600  Semi-annual compilation.
21.605  Inspector General report.

Appendix A to Part 21--Certification Regarding Lobbying
Appendix B to Part 21--Disclosure Form to Report Lobbying

    Authority: Sec. 319, Pub. L. 101-121 (31 U.S.C. 1352); 31 U.S.C. 
321.

    Source: 55 FR 6737, 6751, Feb. 26, 1990 (interim), unless otherwise 
noted.

    Cross reference: See also Office of Management and Budget notice 
published at 54 FR 52306, December 20, 1989.



                           Subpart A--General



Sec. 21.100  Conditions on use of funds.

    (a) No appropriated funds may be expended by the recipient of a 
Federal contract, grant, loan, or cooperative ageement to pay any person 
for influencing or attempting to influence an officer or employee of any 
agency, a Member of Congress, an officer or employee of Congress, or an 
employee of a Member of Congress in connection with any of the following 
covered Federal actions: the awarding of any Federal contract, the 
making of any Federal grant, the making of any Federal loan, the 
entering into of any cooperative agreement, and the extension, 
continuation, renewal, amendment, or modification of any Federal 
contract, grant, loan, or cooperative agreement.
    (b) Each person who requests or receives from an agency a Federal 
contract, grant, loan, or cooperative agreement shall file with that 
agency a certification, set forth in Appendix A, that the person has not 
made, and will not make, any payment prohibited by paragraph (a) of this 
section.
    (c) Each person who requests or receives from an agency a Federal 
contract, grant, loan, or a cooperative agreement shall file with that 
agency a disclosure form, set forth in Appendix B, if such person has 
made or has agreed to make any payment using nonappropriated funds (to 
include profits from any covered Federal action), which would be 
prohibited under paragraph (a) of this section if paid for with 
appropriated funds.
    (d) Each person who requests or receives from an agency a commitment 
providing for the United States to insure or guarantee a loan shall file 
with that agency a statement, set forth in Appendix A, whether that 
person has made or has agreed to make any payment to influence or 
attempt to influence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with that loan insurance or guarantee.
    (e) Each person who requests or receives from an agency a commitment 
providing for the United States to insure or guarantee a loan shall file 
with that agency a disclosure form, set forth in Appendix B, if that 
person has made or has agreed to make any payment to influence or 
attempt to influence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with that loan insurance or guarantee.



Sec. 21.105  Definitions.

    For purposes of this part:
    (a) Agency, as defined in 5 U.S.C. 552(f), includes Federal 
executive departments and agencies as well as independent regulatory 
commissions and Government corporations, as defined in 31 U.S.C. 
9101(1).
    (b) Covered Federal action means any of the following Federal 
actions:
    (1) The awarding of any Federal contract;
    (2) The making of any Federal grant;
    (3) The making of any Federal loan;

[[Page 273]]

    (4) The entering into of any cooperative agreement; and,
    (5) The extension, continuation, renewal, amendment, or modification 
of any Federal contract, grant, loan, or cooperative agreement.

Covered Federal action does not include receiving from an agency a 
commitment providing for the United States to insure or guarantee a 
loan. Loan guarantees and loan insurance are addressed independently 
within this part.
    (c) Federal contract means an acquisition contract awarded by an 
agency, including those subject to the Federal Acquisition Regulation 
(FAR), and any other acquisition contract for real or personal property 
or services not subject to the FAR.
    (d) Federal cooperative agreement means a cooperative agreement 
entered into by an agency.
    (e) Federal grant means an award of financial assistance in the form 
of money, or property in lieu of money, by the Federal Government or a 
direct appropriation made by law to any person. The term does not 
include technical assistance which provides services instead of money, 
or other assistance in the form of revenue sharing, loans, loan 
guarantees, loan insurance, interest subsidies, insurance, or direct 
United States cash assistance to an individual.
    (f) Federal loan means a loan made by an agency. The term does not 
include loan guarantee or loan insurance.
    (g) Indian tribe and tribal organization have the meaning provided 
in section 4 of the Indian Self-Determination and Education Assistance 
Act (25 U.S.C. 450B). Alaskan Natives are included under the definitions 
of Indian tribes in that Act.
    (h) Influencing or attempting to influence means making, with the 
intent to influence, any communication to or appearance before an 
officer or employee or any agency, a Member of Congress, an officer or 
employee of Congress, or an employee of a Member of Congress in 
connection with any covered Federal action.
    (i) Loan guarantee and loan insurance means an agency's guarantee or 
insurance of a loan made by a person.
    (j) Local government means a unit of government in a State and, if 
chartered, established, or otherwise recognized by a State for the 
performance of a governmental duty, including a local public authority, 
a special district, an intrastate district, a council of governments, a 
sponsor group representative organization, and any other instrumentality 
of a local government.
    (k) Officer or employee of an agency includes the following 
individuals who are employed by an agency:
    (1) An individual who is appointed to a position in the Government 
under title 5, U.S. Code, including a position under a temporary 
appointment;
    (2) A member of the uniformed services as defined in section 101(3), 
title 37, U.S. Code;
    (3) A special Government employee as defined in section 202, title 
18, U.S. Code; and,
    (4) An individual who is a member of a Federal advisory committee, 
as defined by the Federal Advisory Committee Act, title 5, U.S. Code 
appendix 2.
    (l) Person means an individual, corporation, company, association, 
authority, firm, partnership, society, State, and local government, 
regardless of whether such entity is operated for profit or not for 
profit. This term excludes an Indian tribe, tribal organization, or any 
other Indian organization with respect to expenditures specifically 
permitted by other Federal law.
    (m) Reasonable compensation means, with respect to a regularly 
employed officer or employee of any person, compensation that is 
consistent with the normal compensation for such officer or employee for 
work that is not furnished to, not funded by, or not furnished in 
cooperation with the Federal Government.
    (n) Reasonable payment means, with respect to perfessional and other 
technical services, a payment in an amount that is consistent with the 
amount normally paid for such services in the private sector.
    (o) Recipient includes all contractors, subcontractors at any tier, 
and subgrantees at any tier of the recipient of funds received in 
connection with a

[[Page 274]]

Federal contract, grant, loan, or cooperative agreement. The term 
excludes an Indian tribe, tribal organization, or any other Indian 
organization with respect to expenditures specifically permitted by 
other Federal law.
    (p) Regularly employed means, with respect to an officer or employee 
of a person requesting or receiving a Federal contract, grant, loan, or 
cooperative agreement or a commitment providing for the United States to 
insure or guarantee a loan, an officer or employee who is employed by 
such person for at least 130 working days within one year immediately 
preceding the date of the submission that initiates agency consideration 
of such person for receipt of such contract, grant, loan, cooperative 
agreement, loan insurance commitment, or loan guarantee commitment. An 
officer or employee who is employed by such person for less than 130 
working days within one year immediately preceding the date of the 
submission that initiates agency consideration of such person shall be 
considered to be regularly employed as soon as he or she is employed by 
such person for 130 working days.
    (q) State means a State of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, a territory or possession of 
the United States, an agency or instrumentality of a State, and a multi-
State, regional, or interstate entity having governmental duties and 
powers.



Sec. 21.110  Certification and disclosure.

    (a) Each person shall file a certification, and a disclosure form, 
if required, with each submission that initiates agency consideration of 
such person for:
    (1) Award of a Federal contract, grant, or cooperative agreement 
exceeding $100,000; or
    (2) An award of a Federal loan or a commitment providing for the 
United States to insure or guarantee a loan exceeding $150,000.
    (b) Each person shall file a certification, and a disclosure form, 
if required, upon receipt by such person of:
    (1) A Federal contract, grant, or cooperative agreement exceeding 
$100,000; or
    (2) A Federal loan or a commitment providing for the United States 
to insure or guarantee a loan exceeding $150,000, unless such person 
previously filed a certification, and a disclosure form, if required, 
under paragraph (a) of this section.
    (c) Each person shall file a disclosure form at the end of each 
calendar quarter in which there occurs any event that requires 
disclosure or that materially affects the accuracy of the information 
contained in any disclosure form previously filed by such person under 
paragraph (a) or (b) of this section. An event that materially affects 
the accuracy of the information reported includes:
    (1) A cumulative increase of $25,000 or more in the amount paid or 
expected to be paid for influencing or attempting to influence a covered 
Federal action; or
    (2) A change in the person(s) or individual(s) influencing or 
attempting to influence a covered Federal action; or,
    (3) A change in the officer(s), employee(s), or Member(s) contacted 
to influence or attempt to influence a covered Federal action.
    (d) Any person who requests or receives from a person referred to in 
paragraph (a) or (b) of this section:
    (1) A subcontract exceeding $100,000 at any tier under a Federal 
contract;
    (2) A subgrant, contract, or subcontract exceeding $100,000 at any 
tier under a Federal grant;
    (3) A contract or subcontract exceeding $100,000 at any tier under a 
Federal loan exceeding $150,000; or,
    (4) A contract or subcontract exceeding $100,000 at any tier under a 
Federal cooperative agreement, shall file a certification, and a 
disclosure form, if required, to the next tier above.
    (e) All disclosure forms, but not certifications, shall be forwarded 
from tier to tier until received by the person referred to in paragraph 
(a) or (b) of this section. That person shall forward all disclosure 
forms to the agency.
    (f) Any certification or disclosure form filed under paragraph (e) 
of this section shall be treated as a material representation of fact 
upon which all receiving tiers shall rely. All liability arising from an 
erroneous representation shall be borne solely by the tier

[[Page 275]]

filing that representation and shall not be shared by any tier to which 
the erroneous representation is forwarded. Submitting an erroneous 
certification or disclosure constitutes a failure to file the required 
certification or disclosure, respectively. If a person fails to file a 
required certification or disclosure, the United States may pursue all 
available remedies, including those authorized by section 1352, title 
31, U.S. Code.
    (g) For awards and commitments in process prior to December 23, 
1989, but not made before that date, certifications shall be required at 
award or commitment, covering activities occurring between December 23, 
1989, and the date of award or commitment. However, for awards and 
commitments in process prior to the December 23, 1989 effective date of 
these provisions, but not made before December 23, 1989, disclosure 
forms shall not be required at time of award or commitment but shall be 
filed within 30 days.
    (h) No reporting is required for an activity paid for with 
appropriated funds if that activity is allowable under either subpart B 
or C.



                 Subpart B--Activities by Own Employees



Sec. 21.200  Agency and legislative liaison.

    (a) The prohibition on the use of appropriated funds, in Sec. 21.100 
(a), does not apply in the case of a payment of reasonable compensation 
made to an officer or employee of a person requesting or receiving a 
Federal contract, grant, loan, or cooperative agreement if the payment 
is for agency and legislative liaison activities not directly related to 
a covered Federal action.
    (b) For purposes of paragraph (a) of this section, providing any 
information specifically requested by an agency or Congress is allowable 
at any time.
    (c) For purposes of paragraph (a) of this section, the following 
agency and legislative liaison activities are allowable at any time only 
where they are not related to a specific solicitation for any covered 
Federal action:
    (1) Discussing with an agency (including individual demonstrations) 
the qualities and characteristics of the person's products or services, 
conditions or terms of sale, and service capabilities; and,
    (2) Technical discussions and other activities regarding the 
application or adaptation of the person's products or services for an 
agency's use.
    (d) For purposes of paragraph (a) of this section, the following 
agencies and legislative liaison activities are allowable only where 
they are prior to formal solicitation of any covered Federal action:
    (1) Providing any information not specifically requested but 
necessary for an agency to make an informed decision about initiation of 
a covered Federal action;
    (2) Technical discussions regarding the preparation of an 
unsolicited proposal prior to its official submission; and,
    (3) Capability presentations by persons seeking awards from an 
agency pursuant to the provisions of the Small Business Act, as amended 
by Pub. L. 95-507 and other subsequent amendments.
    (e) Only those activities expressly authorized by this section are 
allowable under this section.



Sec. 21.205  Professional and technical services.

    (a) The prohibition on the use of appropriated funds, in Sec. 21.100 
(a), does not apply in the case of a payment of reasonable compensation 
made to an officer or employee of a person requesting or receiving a 
Federal contract, grant, loan, or cooperative agreement or an extension, 
continuation, renewal, amendment, or modification of a Federal contract, 
grant, loan, or cooperative agreement if payment is for professional or 
technical services rendered directly in the preparation, submission, or 
negotiation of any bid, proposal, or application for that Federal 
contract, grant, loan, or cooperative agreement or for meeting 
requirements imposed by or pursuant to law as a condition for receiving 
that Federal contract, grant, loan, or cooperative agreement.
    (b) For purposes of paragraph (a) of this section, ``professional 
and technical services'' shall be limited to advice and analysis 
directly applying any professional or technical discipline.

[[Page 276]]

For example, drafting of a legal document accompanying a bid or proposal 
by a lawyer is allowable. Similarly, technical advice provided by an 
engineer on the performance or operational capability of a piece of 
equipment rendered directly in the negotiation of a contract is 
allowable. However, communications with the intent to influence made by 
a professional (such as a licensed lawyer) or a technical person (such 
as a licensed accountant) are not allowable under this section unless 
they provide advice and analysis directly applying their professional or 
technical expertise and unless the advice or analysis is rendered 
directly and solely in the preparation, submission or negotiation of a 
covered Federal action. Thus, for example, communications with the 
intent to influence made by a lawyer that do not provide legal advice or 
analysis directly and solely related to the legal aspects of his or her 
client's proposal, but generally advocate one proposal over another are 
not allowable under this section because the lawyer is not providing 
professional legal services. Similarly, communications with the intent 
to influence made by an engineer providing an engineering analysis prior 
to the preparation or submission of a bid or proposal are not allowable 
under this section since the engineer is providing technical services 
but not directly in the preparation, submission or negotiation of a 
covered Federal action.
    (c) Requirements imposed by or pursuant to law as a condition for 
receiving a covered Federal award include those required by law or 
regulation, or reasonably expected to be required by law or regulation, 
and any other requirements in the actual award documents.
    (d) Only those services expressly authorized by this section are 
allowable under this section.



Sec. 21.210  Reporting.

    No reporting is required with respect to payments of reasonable 
compensation made to regularly employed officers or employees of a 
person.



            Subpart C--Activities by Other Than Own Employees



Sec. 21.300  Professional and technical services.

    (a) The prohibition on the use of appropriated funds, in Sec. 21.100 
(a), does not apply in the case of any reasonable payment to a person, 
other than an officer or employee of a person requesting or receiving a 
covered Federal action, if the payment is for professional or technical 
services rendered directly in the preparation, submission, or 
negotiation of any bid, proposal, or application for that Federal 
contract, grant, loan, or cooperative agreement or for meeting 
requirements imposed by or pursuant to law as a condition for receiving 
that Federal contract, grant, loan, or cooperative agreement.
    (b) The reporting requirements in Sec. 21.110 (a) and (b) regarding 
filing a disclosure form by each person, if required, shall not apply 
with respect to professional or technical services rendered directly in 
the preparation, submission, or negotiation of any commitment providing 
for the United States to insure or guarantee a loan.
    (c) For purposes of paragraph (a) of this section, ``professional 
and technical services'' shall be limited to advice and analysis 
directly applying any professional or technical discipline. For example, 
drafting or a legal document accompanying a bid or proposal by a lawyer 
is allowable. Similarly, technical advice provided by an engineer on the 
performance or operational capability of a piece of equipment rendered 
directly in the negotiation of a contract is allowable. However, 
communications with the intent to influence made by a professional (such 
as a licensed lawyer) or a technical person (such as a licensed 
accountant) are not allowable under this section unless they provide 
advice and analysis directly applying their professional or technical 
expertise and unless the advice or analysis is rendered directly and 
solely in the preparation, submission or negotiation of a covered 
Federal action. Thus, for example, communications with the intent to 
influence made by a lawyer that do not provide legal advice or analysis 
directly and solely related to the legal aspects of

[[Page 277]]

his or her client's proposal, but generally advocate one proposal over 
another are not allowable under this section because the lawyer is not 
providing professional legal services. Similarly, communications with 
the intent to influence made by an engineer providing an engineering 
analysis prior to the preparation or submission of a bid or proposal are 
not allowable under this section since the engineer is providing 
technical services but not directly in the preparation, submission or 
negotiation of a covered Federal action.
    (d) Requirements imposed by or pursuant to law as a condition for 
receiving a covered Federal award include those required by law or 
regulation, or reasonably expected to be required by law or regulation, 
and any other requirements in the actual award documents.
    (e) Persons other than officers or employees of a person requesting 
or receiving a covered Federal action include consultants and trade 
associations.
    (f) Only those services expressly authorized by this section are 
allowable under this section.



                  Subpart D--Penalties and Enforcement



Sec. 21.400  Penalties.

    (a) Any person who makes an expenditure prohibited herein shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such expenditure.
    (b) Any person who fails to file or amend the disclosure form (see 
Appendix B) to be filed or amended if required herein, shall be subject 
to a civil penalty of not less than $10,000 and not more than $100,000 
for each such failure.
    (c) A filing or amended filing on or after the date on which an 
administrative action for the imposition of a civil penalty is commenced 
does not prevent the imposition of such civil penalty for a failure 
occurring before that date. An administrative action is commenced with 
respect to a failure when an investigating official determines in 
writing to commence an investigation of an allegation of such failure.
    (d) In determining whether to impose a civil penalty, and the amount 
of any such penalty, by reason of a violation by any person, the agency 
shall consider the nature, circumstances, extent, and gravity of the 
violation, the effect on the ability of such person to continue in 
business, any prior violations by such person, the degree of culpability 
of such person, the ability of the person to pay the penalty, and such 
other matters as may be appropriate.
    (e) First offenders under paragraphs (a) or (b) of this section 
shall be subject to a civil penalty of $10,000, absent aggravating 
circumstances. Second and subsequent offenses by persons shall be 
subject to an appropriate civil penalty between $10,000 and $100,000, as 
determined by the agency head or his or her designee.
    (f) An imposition of a civil penalty under this section does not 
prevent the United States from seeking any other remedy that may apply 
to the same conduct that is the basis for the imposition of such civil 
penalty.



Sec. 21.405  Penalty procedures.

    Agencies shall impose and collect civil penalties pursuant to the 
provisions of the Program Fraud and Civil Remedies Act, 31 U.S.C. 
sections 3803 (except subsection (c)), 3804, 3805, 3806, 3807, 3808, and 
3812, insofar as these provisions are not inconsistent with the 
requirements herein.



Sec. 21.410  Enforcement.

    The head of each agency shall take such actions as are necessary to 
ensure that the provisions herein are vigorously implemented and 
enforced in that agency.



                          Subpart E--Exemptions



Sec. 21.500  Secretary of Defense.

    (a) The Secretary of Defense may exempt, on a case-by-case basis, a 
covered Federal action from the prohibition whenever the Secretary 
determines, in writing, that such an exemption is in the national 
interest. The Secretary shall transmit a copy of each such written 
exemption to Congress immediately after making such a determination.

[[Page 278]]

    (b) The Department of Defense may issue supplemental regulations to 
implement paragraph (a) of this section.



                        Subpart F--Agency Reports



Sec. 21.600  Semi-annual compilation.

    (a) The head of each agency shall collect and compile the disclosure 
reports (see Appendix B) and, on May 31 and November 30 of each year, 
submit to the Secretary of the Senate and the Clerk of the House of 
Representatives a report containing a compilation of the information 
contained in the disclosure reports received during the six-month period 
ending on March 31 or September 30, respectively, of that year.
    (b) The report, including the compilation, shall be available for 
public inspection 30 days after receipt of the report by the Secretary 
and the Clerk.
    (c) Information that involves intelligence matters shall be reported 
only to the Select Committee on Intelligence of the Senate, the 
Permanent Select Committee on Intelligence of the House of 
Representatives, and the Committees on Appropriations of the Senate and 
the House of Representatives in accordance with procedures agreed to by 
such committees. Such information shall not be available for public 
inspection.
    (d) Information that is classified under Executive Order 12356 or 
any successor order shall be reported only to the Committee on Foreign 
Relations of the Senate and the Committee on Foreign Affairs of the 
House of Representatives or the Committees on Armed Services of the 
Senate and the House of Representatives (whichever such committees have 
jurisdiction of matters involving such information) and to the 
Committees on Appropriations of the Senate and the House of 
Representatives in accordance with procedures agreed to by such 
committees. Such information shall not be available for public 
inspection.
    (e) The first semi-annual compilation shall be submitted on May 31, 
1990, and shall contain a compilation of the disclosure reports received 
from December 23, 1989 to March 31, 1990.
    (f) Major agencies, designated by the Office of Management and 
Budget (OMB), are required to provide machine-readable compilations to 
the Secretary of the Senate and the Clerk of the House of 
Representatives no later than with the compilations due on May 31, 1991. 
OMB shall provide detailed specifications in a memorandum to these 
agencies.
    (g) Non-major agencies are requested to provide machine-readable 
compilations to the Secretary of the Senate and the Clerk of the House 
of Representatives.
    (h) Agencies shall keep the originals of all disclosure reports in 
the official files of the agency.



Sec. 21.605  Inspector General report.

    (a) The Inspector General, or other official as specified in 
paragraph (b) of this section, of each agency shall prepare and submit 
to Congress each year, commencing with submission of the President's 
Budget in 1991, an evaluation of the compliance of that agency with, and 
the effectiveness of, the requirements herein. The evaluation may 
include any recommended changes that may be necessary to strengthen or 
improve the requirements.
    (b) In the case of an agency that does not have an Inspector 
General, the agency official comparable to an Inspector General shall 
prepare and submit the annual report, or, if there is no such comparable 
official, the head of the agency shall prepare and submit the annual 
report.
    (c) The annual report shall be submitted at the same time the agency 
submits its annual budget justifications to Congress.
    (d) The annual report shall include the following: All alleged 
violations relating to the agency's covered Federal actions during the 
year covered by the report, the actions taken by the head of the agency 
in the year covered by the report with respect to those alleged 
violations and alleged violations in previous years, and the amounts of 
civil penalties imposed by the agency in the year covered by the report.

[[Page 279]]

         Appendix A to Part 21--Certification Regarding Lobbying

 Certification for Contracts, Grants, Loans, and Cooperative Agreements

    The undersigned certifies, to the best of his or her knowledge and 
belief, that:
    (1) No Federal appropriated funds have been paid or will be paid, by 
or on behalf of the undersigned, to any person for influencing or 
attempting to influence an officer or employee of an agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with the awarding of any Federal contract, the 
making of any Federal grant, the making of any Federal loan, the 
entering into of any cooperative agreement, and the extension, 
continuation, renewal, amendment, or modification of any Federal 
contract, grant, loan, or cooperative agreement.
    (2) If any funds other than Federal appropriated funds have been 
paid or will be paid to any person for influencing or attempting to 
influence an officer or employee of any agency, a Member of Congress, an 
officer or employee of Congress, or an employee of a Member of Congress 
in connection with this Federal contract, grant, loan, or cooperative 
agreement, the undersigned shall complete and submit Standard Form-LLL, 
``Disclosure Form to Report Lobbying,'' in accordance with its 
instructions.
    (3) The undersigned shall require that the language of this 
certification be included in the award documents for all subawards at 
all tiers (including subcontracts, subgrants, and contracts under 
grants, loans, and cooperative agreements) and that all subrecipients 
shall certify and disclose accordingly.
    This certification is a material representation of fact upon which 
reliance was placed when this transaction was made or entered into. 
Submission of this certification is a prerequisite for making or 
entering into this transaction imposed by section 1352, title 31, U.S. 
Code. Any person who fails to file the required certification shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such failure.

            Statement for Loan Guarantees and Loan Insurance

    The undersigned states, to the best of his or her knowledge and 
belief, that:
    If any funds have been paid or will be paid to any person for 
influencing or attempting to influence an officer or employee of any 
agency, a Member of Congress, an officer or employee of Congress, or an 
employee of a Member of Congress in connection with this commitment 
providing for the United States to insure or guarantee a loan, the 
undersigned shall complete and submit Standard Form-LLL, ``Disclosure 
Form to Report Lobbying,'' in accordance with its instructions.
    Submission of this statement is a prerequisite for making or 
entering into this transaction imposed by section 1352, title 31, U.S. 
Code. Any person who fails to file the required statement shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such failure.

[[Page 280]]


        Appendix B to Part 21--Disclosure Form to Report Lobbying
      [GRAPHIC] [TIFF OMITTED] TC21OC91.002
      

[[Page 281]]


[GRAPHIC] [TIFF OMITTED] TC21OC91.003


[[Page 282]]


[GRAPHIC] [TIFF OMITTED] TC21OC91.004


[[Page 283]]





    PART 25--PREPAYMENT OF FOREIGN MILITARY SALES LOANS MADE BY THE DEFENSE SECURITY ASSISTANCE AGENCY AND FOREIGN MILITARY SALES LOANS MADE BY THE FEDERAL 
FINANCING BANK AND GUARANTEED BY THE DEFENSE SECURITY ASSISTANCE AGENCY--Table of Contents




                           Subpart A--General

Sec.
25.100  Definitions.
25.101  OMB control number.

                Subpart B--Qualifications for Prepayment

25.200  General rules.

                          Subpart C--Procedures

25.300  Application procedure.
25.301  Approval procedure.
25.302  Application withdrawal; effect of approval.
25.303  Closing procedure.

                     Subpart D--Form of Private Loan

25.400  Loan provisions.
25.401  Fees.
25.402  Transferability.
25.403  Registration.
25.404  Non-separability.
25.405  Form of guaranty.
25.406  Savings clause.

    Authority: Title III, Pub. L. 100-202; 31 U.S.C. 321.

    Source: 53 FR 25426, July 6, 1988, unless otherwise noted.



                           Subpart A--General



Sec. 25.100  Definitions.

    In this part, unless the context indicates otherwise:
    (a) Act means the provisions entitled ``Foreign Military Sales Debt 
Reform,'' of Title III, entitled ``Military Assistance,'' of an act 
entitled ``Foreign Operations, Export Financing and Related Programs 
Appropriations Act, 1988'' (Pub. L. 100-202), enacted December 22, 1987.
    (b) AECA means the Arms Export Control Act, as amended (22 U.S.C. 
2751 et seq.).
    (c) Borrower means the obligor on an FMS Advance.
    (d) Closing date means:
    (1) With respect to the prepayment of the amounts permitted by this 
part to be prepaid of FMS Loans held by DSAA, the date designated by the 
mutual agreement of both the Borrower and DSAA on which the Guaranty 
will be attached to the Private Loan Note or the Private Loan Portion 
Notes, as the case may be, the Private Loan will be funded, and the 
Total Permitted Prepayment Amount, or the portion thereof which the 
Borrower has selected to prepay, will be prepaid; and
    (2) With respect to the prepayment of the amounts permitted by this 
part to be prepaid of FMS Loans held by the FFB and guaranteed by DSAA, 
the date designated by the mutual agreement of the Borrower, the FFB, 
and DSAA on which the Guaranty will be attached to the Private Loan Note 
or the Private Loan Portion Notes, as the case may be, the Private Loan 
will be funded, and the Total Permitted Prepayment Amount, or Portion 
thereof which the Borrower has selected to prepay, will be prepaid.
    (e) Derivative means any right, interest, instrument or security 
issued or traded on the credit of the Private Loan or any Private Loan 
Portion, including but not limited to:
    (1) Any participation share of, or undivided ownership or other 
equity interest in, the Private Loan or any Private Loan Portion;
    (2) Any note, bond or other debt instrument or obligation which is 
collateralized or otherwise secured by a pledge of, or secruity interest 
in, the Private Loan or any Private Loan Portion; or
    (3) Any such interest in such an interest or any such instrument 
secured by such an instrument.
    (f) DSAA means the Defense Security Assistance Agency, an agency 
within the Department of Defense.
    (g) Eligible FMS advance means any FMS Advance which:
    (1) Was outstanding on December 22, 1987;
    (2) Has principal amounts becoming due and payable after September 
30, 1989; and
    (3) Bears interest at a rate equal to or greater than 10 percentum 
per annum.


[[Page 284]]



Eligible FMS Advance may include FMS Advances meeting the criteria of 
Eligible FMS Advance which are made on account of FMS Loans even when 
such FMS Loans do not, in themselves, meet the criteria of Eligible FMS 
Loan.
    (h) Eligible FMS loan means any FMS Loan which:
    (1) Was outstanding on December 22, 1987;
    (2) Has principal amounts becoming due and payable after September 
30, 1989; and
    (3) Bears interest pursuant to the terms of the loan agreement 
relating thereto at a consolidated rate equal to or greater than 10 
percentum per annum.

Eligible FMS Loans may include FMS Advances which are made on account of 
FMS Loans meeting the criteria of Eligible FMS Loan even when such FMS 
Advances do not, in themselves, meet the criteria of Eligible FMS 
Advance.
    (i) Eligible private lender means either:
    (1) Any of the following entities:
    (i) Any banking, savings, or lending institution, or any subsidiary 
or affiliate thereof, chartered or otherwise lawfully organized under 
the laws of any State, the District of Columbia, the United States or 
any territory or possession of the United States, including, but not 
limited to, any bank, trust company, industrial bank, investment banking 
company, savings association, savings and loan association, building and 
loan association, savings bank, credit union, or finance company, which 
is doing business in the United States;
    (ii) Any broker or dealer registered with the Securities and 
Exchange Commission pursuant to the Securities Exchange Act of 1934;
    (iii) Any company lawfully organized as an insurance company, and 
which is subject to supervision by the insurance commissioner or a 
similar official or agency of a State; or
    (iv) Any United States pension fund; or
    (2) Any trust or other special purpose financing entity which is 
funded initially by an entity or entities of the type described in 
paragraph (i)(1) of this section.
    (j) FFB means the Federal Financing Bank, and instrumentality and 
wholly-owned corporation of the United States.
    (k) FMS means Foreign Military Sales.
    (l) FMA advance means:
    (1) A disbursement of funds made pursuant to a loan agreement 
between the Borrower and DSAA, which loan agreement provides for making 
of an FMS Loan; or
    (2) A disbursement of funds made pursuant to a loan agreement 
between the Borrower and the FFB, which loan agreement provides for the 
making of an FMS Loan.
    (m) FMS loan means either:
    (1) A loan made directly by the Secretary of Defense pursuant to 
section 23 of AECA; or
    (2) A loan made by the FFB and guaranteed by the Secretary of 
Defense pursuant to section 24 of AECA; and ``FMS Loans'' mean the 
aggregate of such loans made to or for the account of a Borrower.
    (n) Guaranteed-amount debt derivative means any note, bond or other 
debt instrument or obligation which is collateralized or otherwise 
secured by a pledge of, or security interest in, the Private Loan Note 
or any Private Loan Portion Note or any Derivative, as the case may be, 
which has an exclusive or preferred claim to the Guaranteed Loan Amount 
or the respective Guaranteed Loan Portion Amount or the respective 
Guaranteed-Amount Equivalent, as the case may be.
    (o) Guaranteed-amount equity derivative means any participation 
share of, or undivided ownership or other equity interest in, the 
Private Loan or any Private Loan Portion or any Derivative, as the case 
may be, which has an exclusive or preferred claim to the Guaranteed Loan 
Amount or the respective Guaranteed Loan Portion Amount or the 
respective Guaranteed-Amount Equivalent, as the case may be.
    (p) Guaranteed-amount equivalent means:
    (1) With respect to any Derivative which is equal in principal 
amount to the Private Loan or any Private Loan Portion, that amount of 
payment on account of such Derivative which is

[[Page 285]]

equal to the Guaranteed Loan Amount or the respective Guaranteed Loan 
Portion Amount, as the case may be; or
    (2) With respect to any Derivatives which in the aggregate are equal 
in principal amount to the Private Loan or any Private Loan Portion, 
that amount of payment on account of such derivatives which is equal to 
the Guaranteed Loan Amount or the respective Guaranteed Loan Portion 
Amount, as the case may be.
    (q) Guaranteed loan amount means that amount of payment on account 
of the Private Loan which is guaranteed under the terms of the Guaranty.
    (r) Guaranteed loan portion amount means that amount of payment on 
account of any Private Loan Portion which is guaranteed under the terms 
of the Guaranty.
    (s) Guaranty means either a new guaranty of the United States issued 
by DSAA or an existing guaranty of the United States transferred by 
DSAA, in the form of guaranty set forth in Sec. 25.405, which guaranty 
will be attached to a Private Loan Note or Private Loan Portion Note.
    (t) Interest rate difference means the difference between:
    (1) The cost of funds to the Borrower for the Private Loan 
(expressed in terms of the true rate of interest applicable to the 
Private Loan) if paragraph (a) of Sec. 25.404 applies to the Private 
Loan; and
    (2) The cost of funds to the Borrower for the Private Loan 
(expressed in terms of the true rate of interest applicable to the 
Private Loan) if paragraph (a) of Sec. 25.404 does not apply to the 
Private Loan.
    (u) Non-registered obligation means a bearer obligation which does 
not comply with all of the registration requirements of the Internal 
Revenue Code.
    (v) Permitted arrears prepayment amount means the sum of all 
arrears, if any, on all FMS Loans, which arrears are outstanding on the 
Closing Date.
    (w) Permitted guaranty holder means:
    (1) An individual domiciled in the United States;
    (2) A corporation incorporated, chartered or otherwise organized in 
the United States; or
    (3) A partnership or other juridical entity doing business in the 
United States.
    (x) Permitted P&I prepayment amount means, with respect to each 
Eligible FMS Loan or Eligible FMS Advance, as the case may be, the sum 
of:
    (1) All principal amounts which become due and payable after 
September 30, 1989, on the respective Eligible FMS Loan or Eligible FMS 
Advance; and
    (2) All unpaid interest, if any, on the respective Eligible FMS Loan 
or Eligible FMS Advance accrued as of the Closing Date.
    (y) Private loan means, collectively, the loan or loans that is or 
are obtained by the Borrower from an Eligible Private Lender to prepay 
the Total Permitted Prepayment Amount, or the portion thereof which the 
Borrower has selected to prepay.
    (z) Private loan note means, collectively, the note or notes 
executed and delivered by the Borrower to evidence the Private Loan.
    (aa) Private loan portion means any portion of the Private Loan.
    (bb) Private loan portion note means any note executed and delivered 
by the Borrower to evidence a Private Loan Portion.
    (cc) Total permitted prepayment amount means the sum of:
    (1) The aggregate of the respective Permitted P&I Prepayment amount 
for all Eligible FMS Loans and all Eligible FMS Advances on account of 
FMS Loans which FMS Loans do not, in themselves, meet the criteria of 
Eligible FMS Loans; and
    (2) The Permitted Arrears Prepayment Amount.
    (dd) Unguaranteed-amount equivalent means all amounts of payment on 
account of any Derivative other than the respective Guaranteed-Amount 
Equivalent.
    (ee) Unguaranteed loan amount means all amounts of payment on 
account of the Private Loan other than the Guaranteed Amount.
    (ff) Unguaranteed loan portion amount means all amounts of payment 
on account of any Private Loan Portion other than the respective 
Guaranteed Loan Portion Amount.

[[Page 286]]



Sec. 25.101  OMB control number.

    The reporting requirements in this part have been approved under the 
Office of Management and Budget control number 1505-0109.



                Subpart B--Qualifications for Prepayment



Sec. 25.200  General rules.

    (a) To qualify for a loan prepayment at par pursuant to subsection 
(a) of the Act, a Borrower must have an Eligible FMS Loan or an Eligible 
FMS Advance.
    (b) A Borrower may prepay the Total Permitted Prepayment Amount in 
portions using more than one closing; however, all prepayments of the 
Total Permitted Prepayment Amount must have a Closing Date that is not 
later than September 30, 1991.
    (c) A Borrower may prepay all or a portion of the Total Permitted 
Prepayment Amount; however, if a Borrower selects to prepay any 
Permitted P&I Prepayment Amount of an FMS Advance, the Borrower must 
prepay the entire Permitted P&I Prepayment Amount of such FMS Advance.
    (d) If the payment billings of an FMS Loan have been consolidated in 
accordance with the terms of the respective loan agreement, and if any 
principal payments have been made on account of the FMS Loan, then the 
outstanding principal balances of any Eligible FMS Advances shall be 
determined in accordance with the principal of ``first disbursed, first 
repaid,'' that is, advances on account of the FMS Loan shall be deemed 
to have been repaid in the chronological order in which they were 
disbursed.



                          Subpart C--Procedures



Sec. 25.300  Application procedure.

    (a) Each Borrower that wishes to prepay at par the Total Permitted 
Prepayment Amount, or any portion thereof, must submit a written 
prepayment application. To be considered complete, a prepayment 
application must contain the following information and materials:
    (1) Part I of the prepayment application shall be the identification 
of each Eligible FMS Loan or Eligible FMS Advance, as the case may be, 
with respect to which the Borrower has selected to prepay the amount 
thereof permitted by this part to be prepaid, setting forth with respect 
to each such Eligible FMS Loan or Eligible FMS Advance:
    (i) The date on which the Eligible FMS Advance was made or the date 
on which the Eligible FMS Loan was signed;
    (ii) The original amount of the Eligible FMS Loan or Eligible FMS 
Advance;
    (iii) The principal and interest payment schedule of the Eligible 
FMS Loan or Eligible FMS Advance; and
    (iv) The maturity of the Eligible FMS Loan or Eligible FMS Advance.
    (2) Part II of the prepayment application shall be the Borrower's 
estimate of the Permitted Arrears Prepayment Amount calculated as of the 
date of the application;
    (3) Part III of the prepayment application shall be a description of 
each Private Loan, 90 percent of which the Borrower seeks to have 
guaranteed, setting forth with respect to each Private Loan:
    (i) The total amount of the Private Loan,
    (ii) The proposed principal and interest payment schedule of the 
Private Loan,
    (iii) The proposed maturity of the Private Loan, and
    (iv) The identity of each Eligible FMS Loan or Eligible FMS Advance 
with respect to which amount thereof permitted by this part to be 
prepaid is to be prepaid with the proceeds of the Private Loan;
    (4) Part IV of the prepayment application shall be all material 
transaction documents, in substantially final form, relating to the 
prepayment of the Total Permitted Prepayment Amount, or the portion 
thereof which the Borrower has selected to prepay, with the proceeds of 
the Private Loan; and
    (5) Part V of the prepayment application shall be the name, address, 
and telephone number of the Borrower's contact person with whom the FFB 
or DSAA will communicate to arrange for prepayment and closing.
    (b) Each prepayment application shall be submitted in triplicate to

[[Page 287]]

DSAA at the following address: Defense Security Assistance Agency, The 
Pentagon, Washington, DC 20301-2800, Attention: Deputy Comptroller.
    (c) A Borrower wishing to obtain preliminary, nonbinding review of a 
plan to prepay at par the Total Permitted Prepayment Amount, or any 
portion thereof, may, at the Borrower's option, prior to submitting a 
prepayment application in accordance with paragraph (a) of this section, 
submit to DSAA, at the address set forth in paragraph (b) of this 
section, a written plan of prepayment. To qualify for review, a plan of 
prepayment must include a detailed description of the proposed financing 
structure clearly addressing the terms and conditions of the proposed 
Private Loan. DSAA will review each plan of prepayment submitted by 
Borrowers and may engage in informal, non-binding discussions with each 
Borrower that submitted a plan of prepayment to assist such Borrower in 
preparing a prepayment application.



Sec. 25.301  Approval procedure.

    (a) Distribution, Review, and Processing by DSAA. (1) Upon receipt 
of three copies of a completed prepayment application from a Borrower, 
DSAA will promptly deliver one copy of Parts I and II of the prepayment 
application to the State Department and one copy of Parts I, II, and V 
of the prepayment application to the Treasury Department.
    (2) DSAA will review each completed prepayment application to ensure 
that the Private Loan complies with the requirements of this part, 
including without limitation the requirements of Sec. 25.400. DSAA will 
also review each completed prepayment application to ensure that the 
provisions of subsection (d) of the Act (Purposes and Reports) are 
considered. DSAA will process each completed prepayment application 
within 16 days after receipt by DSAA of the respective completed 
application from a Borrower.
    (3) After DSAA has processed a completed prepayment application, 
DSAA will either:
    (i) Return the application to the Borrower; or
    (ii) Deliver to the State Department written evidence of the 
approval of the prepayment application by DSAA.
    (b) Review and Processing by the State Department. (1) The State 
Department will review Parts I and II of each prepayment application 
received by the State Department from DSAA to ensure that the provisions 
of subsection (d) of the Act (Purposes and Reports) are considered. The 
State Department will process Parts I and II of each prepayment 
application within 7 days after receipt by the State Department of 
written evidence of the approval of the prepayment application by DSAA.
    (2) After the State Department has processed Parts I and II of a 
prepayment application, the State Department will either:
    (i) Return the parts of the application to DSAA for return to the 
Borrower; or
    (ii) Deliver to the Treasury Department written evidence of the 
approvals of the prepayment application by DSAA and the State 
Department.
    (c) Processing by the Treasury Department--(1) FMS Loans held by 
DSAA. (i) The Treasury Department will process Parts I and II of each 
prepayment application regarding an Eligible FMS Loan made by DSAA or an 
Eligible FMS Advance on account of an FMS Loan made by DSAA, as the case 
may be, within 7 days after receipt by the Treasury Department of 
written evidence of the approvals of the prepayment application by DSAA 
and the State Department;
    (ii) After the Treasury Department has processed Parts I and II of a 
prepayment application, the Treasury Department will return the parts of 
the application to DSAA, and thereupon DSAA will commence the Closing 
Procedures described in Sec. 25.303(a) with respect to the application.
    (2) FMS Loans held by the FFB. (i) The Treasury Department will 
process Parts I and II of each prepayment application regarding an 
Eligible FMS Loan made by the FFB and guaranteed by DSAA or an Eligible 
FMS Advance on account of an FMS Loan made by the FFB and guaranteed by 
DSAA, as the case may be, within 7 days after receipt by the Treasury 
Department from the State Department of written evidence of the 
approvals of the prepayment application by DSAA and the State 
Department; and

[[Page 288]]

    (ii) After the Treasury Department has processed Parts I and II of a 
prepayment application, the Treasury Department will commence the 
Closing Procedures described in Sec. 25.303(b) with respect to the 
application.



Sec. 25.302  Application withdrawal; effect of approval.

    A Borrower that submits a prepayment application may withdraw the 
prepayment application at any time prior to its approval. Even after a 
Borrower's prepayment application has been approved, the Borrower is not 
obligated to prepay its Eligible FMS Loans or Eligible FMS Advances.



Sec. 25.303  Closing procedure.

    (a) FMS loans held by DSAA. (1) After the Treasury has processed 
Parts I and II of a prepayment application regarding an Eligible FMS 
Loan made by DSAA or an Eligible FMS Advance on account of an FMS Loan 
made by DSAA, as the case may be, DSAA will communicate with the 
Borrower's contact person identified in Part V of the prepayment 
application to establish a Closing Date mutually agreeable to the 
Borrower and DSAA. DSAA will inform the Borrower of the final amount of 
the Total Permitted Prepayment Amount, or the portion thereof which the 
Borrower has selected to prepay, as of the Closing Date established. The 
determination by DSAA of the final amount of the Total Permitted 
Prepayment Amount, or the portion thereof which the Borrower has 
selected to prepay, shall be conclusive.
    (2) On the Closing Date, the Guaranty will be attached to the 
Private Loan Note or the Private Loan Portion Notes, as the case may be, 
the Private Loan shall be funded, and the Total Permitted Prepayment 
Amount, or the portion thereof which the Borrower has selected to 
prepay, will be prepaid.
    (3) The attachment of the Guaranty to the Private Loan Note or the 
Private Loan Portion Notes, as the case may be, will take place at such 
location as may be designated by the mutual agreement of the Borrower 
and DSAA.
    (4) Prior to 1:00 p.m. prevailing local time in New York, New York, 
on the Closing Date, immediately available funds in amounts sufficient 
to prepay the Total Permitted Prepayment Amount, or the portion thereof 
which the Borrower has selected to prepay, shall be transferred by 
electronic funds transfer to DSAA at the Treasury Department account at 
the Federal Reserve Bank of New York. The funds transfer message must 
include the following credit information:

United States Treasury, New York, New York, 021030004, TREAS NYC/ 
(5037).
For credit to the Defense Security Assistance Agency, The Pentagon, 
Washington, DC 20301-2800.


This information must be exactly in this form (including spacing between 
words and numbers) to insure timely receipt by the DSAA. Checks, drafts, 
and other orders for payment will not be accepted.
    (b) FMS Loans held by the FFB. (1) After the Treasury Department has 
processed Parts I and II of a prepayment application regarding an 
Eligible FMS Loan made by the FFB and guaranteed by DSAA or an Eligible 
FMS Advance on account of an FMS Loan made by the FFB and guaranteed by 
DSAA, as the case may be, the FFB will communicate with the Borrower's 
contact person identified in Part V of the prepayment application to 
establish a Closing Date mutually agreeable to the Borrower, the FFB, 
and DSAA. The FFB will inform the Borrower of the final amount of the 
Total Permitted Prepayment Amount, or the portion thereof which the 
Borrower has selected to prepay, as of the Closing Date established. The 
determination by the FFB of the final amount of the Total Permitted 
Prepayment Amount, or the portion thereof which the Borrower has 
selected to prepay, shall be conclusive.
    (2) On the Closing Date, the Guaranty will be attached to the 
Private Loan Note or the Private Loan Portion Notes, as the case may be, 
the Private Loan will be funded, and the Total Permitted Prepayment 
Amount, or the portion thereof which the Borrower has selected to 
prepay, will be prepaid.
    (3) The attachment of the Guaranty to the Private Loan Note or the 
Private Loan Portion Notes, as the case

[[Page 289]]

may be, will take place at such location as may be designated by the 
mutual agreement of the Borrower and DSAA.
    (4) Prior to 1:00 p.m. prevailing local time in New York, New York, 
on the Closing Date, immediately available funds in amounts sufficient 
to prepay at par the Permitted Prepayment Amount, or the portion thereof 
which the Borrower has selected to prepay, shall be transferred by 
electronic funds transfer to the Treasury Department account at the 
Federal Reserve Bank of New York. The funds transfer message must 
include the following credit information:

United States Treasury, New York, New York, 021030004, TREAS NYC/ 
(20180006).
For credit to the Federal Financing Bank, Room 143, Liberty Center 
Building, 401 14th Street SW., Washington, DC 20227.


This information must be exactly in this form (including spacing between 
words and numbers) to insure timely receipt by the FFB. Checks, drafts, 
and others for payment will not be accepted.
    (c) Changes in the closing date. If a Borrower does not prepay the 
Total Permitted Prepayment Amount or the portion thereof which the 
Borrower has selected to prepay, on the mutually agreed upon Closing 
Date, the Borrower may prepay the Total Permitted Prepayment Amount, or 
the portion thereof which the Borrower has selected to prepay, on a new 
Closing Date, provided that the new Closing Date is mutually agreeable 
to all interested parties, and provided, further, that the Borrower 
prepays such amount in accordance with the approved prepayment 
application, adjusted for changes in accrued interest.



                     Subpart D--Form of Private Loan



Sec. 25.400  Loan provisions.

    (a) Subject to the provisions of paragraph (b) of this section, the 
principal and interest payment schedule and maturity of the Private Loan 
must be the same as the payment schedules and maturities of the Eligible 
FMS Loans or Eligible FMS Advances, as the case may be, which the 
Borrower has selected to prepay with the proceeds of the Private Loan.
    (b) Notwithstanding the preceding paragraph, an Eligible Private 
Lender that proposes to make a Private Loan, the proceeds of which will 
be used to prepay Eligible FMS Loans or Eligible FMS Advances, as the 
case may be, having differing payment structures and maturities, may:
    (1) Consolidate the differing payment structures of the Eligible FMS 
Loans or the Eligible FMS Advances, as the case may be, into a single 
payment structure which complies with the following criteria:
    (i) The Private Loan shall have one set of semi-annual payment 
dates;
    (ii) Interest on and principal of the Private Loan shall be payable 
semi-annually; and
    (iii) The amount of principal to be paid each year on account of the 
Private Loan shall be equal (rounded to the nearest $1,000.00 if 
desired, except for the final payment) to the aggregate amount of 
principal that is scheduled to be paid in such year on account of the 
respective Eligible FMS Loans or Eligible FMS Advances; or
    (2) Consolidate the differing payment structures and maturities of 
the Eligible FMS Loans or the Eligible FMS Advances, as the case may be, 
into a single payment structure and maturity complying with the 
following criteria:
    (i) The final maturity date of the Private Loan shall be the 
approximate weighted average of the final maturity dates of the Eligible 
FMS Loans or the Eligible FMS Advances with respect to which the 
Borrower has selected to prepay amounts thereof permitted by this part 
to be prepaid;
    (ii) The initial principal payment date of the Private Loan shall 
occur no later than the earliest scheduled principal payment date of the 
Eligible FMS Loans or the Eligible FMS Advances with respect to which 
the Borrower has selected to prepay amounts thereof permitted by this 
part to be prepaid;
    (iii) The Private Loan shall have one set of semi-annual payment 
dates;
    (iv) Interest on the Private Loan shall be payable semi-annually; 
and
    (v) The principal of the Private Loan shall be payable in equal 
installments

[[Page 290]]

(rounded to the nearest $1,000.00 if desired, except for the final 
payment) and shall be payable either semi-annually or annually.



Sec. 25.401  Fees.

    The interest rate on the Private Loan may include compensation for 
costs at prevailing market rates with the agreement of the Borrower and 
the Eligible Private Lender selected by the Borrower.



Sec. 25.402  Transferability.

    Each Private Loan Note, with the Guaranty attached, shall be fully 
and freely transferable to any Permitted Guaranty Holder.



Sec. 25.403  Registration.

    The Guaranty shall cease to be effective with respect to the Private 
Loan or any Private Loan Portion or any Derivative to the extent that 
the Private Loan or the respective Private Loan Portion or the 
respective Derivative, as the case may be, is used to provide 
significant support for a Non-Registered Obligation.



Sec. 25.404  Non-separability.

    (a) The Guaranty shall cease to be effective with respect to any 
Guaranteed Loan Amount or any Guaranteed Loan Portion Amount or any 
Guaranteed-Amount Equivalent to the extent that:
    (1) The Guaranteed Amount or the respective Guaranteed Loan Portion 
Amount or the respective Guaranteed-Amount Equivalent, as the case may 
be, is separated at any time from the Unguaranteed Loan Amount or the 
respective Unguaranteed Loan Portion Amount or the respective 
Unguaranteed-Amount Equivalent, as the case may be, in any way, directly 
or through the issuance of any Guaranteed-Amount Equity Derivative or 
any Guaranteed-Amount Debt Derivative; or
    (2) Any holder of the Private Loan Note or any Private Loan Portion 
Note or any Derivative, as the case may be, having a claim to payments 
on the Private Loan receives more than 90 percent of any payment due to 
such holder from payments made under the Guaranty at any time during the 
term of the Private Loan.
    (b) Notwithstanding the preceding paragraph, if any Guaranteed-
Amount Debt Derivative is issued, the Guaranty shall not cease to be 
effective with respect to any Guaranteed Loan Amount or any Guaranteed 
Loan Portion Amount or any Guaranteed-Amount Equivalent, as the case may 
be, if both of the circumstances described in paragraphs (b)(1) and 
(b)(2) of this section.
    (1) A Borrower shall have delivered to the Secretary of the treasury 
evidence, in form and substance satisfactory to the Secretary of the 
Treasury, that the Interest Rate Difference will be substantial.
    (i) To be considered, the evidence must meet the following 
requirements:
    (A) The Borrower must show that the Interest Rate Difference is 
directly attributable to paragraph (a) of this section being applied to 
the Private Loan, that is, that the Interest Rate Difference will exist 
even when all other financing terms of the Private Loan, including any 
collateralization of the Unguaranteed Loan Amount or the respective 
Unguaranteed Loan Portion Amount or the respective Unguaranteed-Amount 
Equivalent, as the case may be, are identical;
    (B) When calculating the Interest Rate Difference, the Borrower must 
assume that the Unguaranteed Loan Amount or the respective Unguaranteed 
Loan Portion Amount or the respective Unguaranteed-Amount Equivalent, as 
the case may be, will be collateralized by securities backed by the full 
faith and credit of the United States, unless the Borrower is legally 
prohibited from so collateralizing the Unguaranteed Loan Amount or the 
respective Unguaranteed Loan Portion Amount or the respective 
Unguaranteed-Amount Equivalent, as the case may be, or the Borrower has 
demonstrated to the satisfaction of the Secretary of the Treasury that 
the Borrower is unable to so collateralize the Unguaranteed Loan Amount 
or the respective Unguaranteed Loan Portion Amount or the respective 
Unguaranteed-Amount Equivalent;
    (C) If the Borrower is legally prohibited from collateralizing the 
Unguaranteed Loan Amount or the respective Loan Guaranteed Portion

[[Page 291]]

Amount or the respective Unguaranteed-Amount Equivalent, as the case may 
be, with securities backed by the full faith and credit of the United 
States or has demonstrated to the satisfaction of the Secretary of the 
Treasury that the Borrower is unable to so collateralize the 
Unguaranteed Loan Amount or the respective Unguaranteed Loan Portion 
Amount or the respective Unguaranteed-Amount Equivalent, as the case may 
be, then the Borrower may calculate the Interest Rate Difference using 
whatever collateralization assumptions the Borrower elects;
    (D) If the Borrower delivers evidence to the Secretary of the 
Treasury respecting the Interest Rate Difference, which evidence assumes 
either that the Unguaranteed Loan Amount or the respective Unguaranteed 
Loan Portion Amount or the respective Unguaranteed-Amount Equivalent, as 
the case may be, will not be collateralized at all or that the 
Unguaranteed Loan Amount or the respective Unguaranteed Loan Portion 
Amount or the respective Unguaranteed-Amount Equivalent, as the case may 
be, will be collateralized, but not by securities backed by the full 
faith and credit of the United States, then the Borrower must also 
deliver to the Secretary of the Treasury the written agreement of the 
Borrower, which agreement shall be in form and substance satisfactory to 
the Secretary of the Treasury, that the Borrower will not collateralize 
the Unguaranteed Loan Amount or the respective Unguaranteed Loan Portion 
Amount or the respective Unguaranteed-Amount Equivalent, as the case may 
be, at any time during the term of the Private Loan in any way different 
from the assumptions used in calculating the Interest Rate Difference; 
and
    (E) The Borrower must deliver to the Secretary of the Treasury the 
evidence pertaining to the Interest Rate Difference at the time that the 
Borrower submits to DSAA its plan for prepayment, if any, if no plan of 
prepayment is submitted, then no later than 10 days prior to the time 
that the Borrower submits to DSAA its prepayment application.
    (ii) If the Secretary of the Treasury determines that the evidence 
submitted by the Borrower pertaining to the Interest Rate Difference is 
satisfactory in form and in substance, and that the Interest Rate 
Difference is substantial, a modified version of the Guaranty (deleting 
therefrom the provision that the Guaranty shall cease to be effective if 
any Guaranteed-Amount Debt Derivative is issued) will be attached to the 
Private Loan Note or the Private Loan Portion Notes, as the case may be.
    (2) The Secretary of the Treasury shall have determined, in the sole 
discretion of the Secretary of the Treasury, that the respective 
Borrower's loan prepayment at par pursuant to subsection (a) of the Act 
through the issuance of any Guaranteed-Amount Debt Derivative is 
necessary to achieve the international economic policy interests of the 
United States.



Sec. 25.405  Form of guaranty.

    (a) The Guaranty that will be attached to the Private Loan Note on 
the Closing Date shall be in the following form (except that the 
bracketed words shall be deleted if the conditions specified in 
Sec. 25.404(b) shall have occurred):

    For Value Received, the Defense Security Assistance Agency of the 
Department of Defense (``DSAA''), hereby guarantees to (Name of Lender) 
(``Lender''), incorporated under the laws of (U.S. State or other U.S. 
jurisdiction) or if not so incorporated or organized, then the principal 
place of doing business is (U.S. location, address, and zip code), under 
the authority of Section 24 of the Arms Export Control Act, as amended 
(``Act''), the due and punctual payment of ninety percent (90%) of 
amounts due: (1) on the promissory note (``Note'') in the principal 
amount of up to $------ dated ------ issued to the Lender by the 
Government of (Name of Borrower) (``Borrower'') pursuant to the Loan 
Agreement between the Lender and the Borrower dated the ----th day of --
---- (``Agreement''); and (2) the Lender from the Borrower pursuant to 
the Agreement.
    This Guaranty is a guaranty of payment covering all political and 
credit risks of nonpayment, including any nonpayment arising out of any 
claim which the Borrower may now or hereafter have against any person, 
corporation, or other entity (including without limitation, the United 
States, the Lender, and any supplier of defense items) in connection 
with any transaction, for any reason whatsoever. This Guaranty shall 
inure to the

[[Page 292]]

benefit of and shall be enforceable by the Lender and any Permitted 
Guaranty Holder (as hereinafter defined). This Guaranty shall not be 
impaired by any law, regulation or decree of the Borrower now or 
hereafter in effect which might in any manner change any of the terms of 
the Note or Agreement. The obligation of DSAA hereunder shall be binding 
irrespective of the irregularity, invalidity or unenforceability under 
any laws, regulations or decrees of the Borrower of the Note, the 
Agreement or other instruments related thereto.
    DSAA hereby waives diligence, demand, protest, presentment and any 
requirement that the Lender exhaust any right or power to take any 
action against the Borrower and any notice of any kind whatsoever other 
than the demand for payment required to be given to DSAA hereunder in 
the event of default on a payment due under the Note.
    In the event of failure of the Borrower to make payment, when and as 
due, of any installment of principal or interest under the Note, the 
DSAA shall make payment immediately to the Lender upon demand to the 
DSAA after the Borrower's failure to pay has continued for 10 calendar 
days. The amount payable under this Guaranty shall be ninety percent 
(90%) of the amount of the overdue installment of principal and 
interest, plus ninety percent (90%) of any and all late charges and 
interest thereon as provided in the Agreement. Upon payment by DSAA to 
the Lender, the Lender will assign to DSAA, without recourse or 
warranty, ninety percent (90%) of all of its rights in the Note and the 
Agreement with respect to such payment.
    In the event of a default under the Agreement or the Note by the 
Borrower and so long as this Guaranty is in effect and the DSAA is not 
in default hereunder:
    (i) The Lender or other Permitted Guaranty Holder shall not 
accelerate or reschedule payment of the principal or interest on the 
Note or any other note of the Borrower guaranteed by DSAA except with 
the written approval of DSAA; and
    (ii) The Lender or other Permitted Guaranty Holder shall, if so 
directed by DSAA, invoke the default provisions of the Agreement.
    Subject to the limitations set forth below, the Lender's rights 
under this Guaranty may be assigned to any ``Permitted Guaranty 
Holder,'' that is: (1) An individual domiciled in the United States; (2) 
a corporation incorporated, chartered or otherwise organized in the 
United States; or (3) a partnership or other juridical entity doing 
business in the United States. In the event of such assignment DSAA 
shall be promptly notified. The Lender will not agree to any material 
amendment of the Agreement or Note or consent to any material deviation 
from the provisions thereof without the prior written consent of DSAA.
    Permitted Guaranty Holders shall be severally bound by, and shall be 
severally entitled to, the rights and obligations of the Lender under 
the Note, the Agreement, and this Guaranty. The Lender shall maintain a 
current, accurate written record of the names, addresses, amount of 
financial interest in the Note and Agreement, and date of acquisition of 
such interest of each Permitted Guaranty Holder and shall furnish DSAA a 
copy of such record on its demand without charge. No assignment by the 
Lender or by any Permitted Guaranty Holder shall be effective for 
purposes of this Guaranty unless and until so recorded by the Lender.
    The total amount of this Guaranty shall not at any time exceed 
ninety percent (90%) of the outstanding principal, unpaid accrued 
interest and arrearages, if any, under the Agreement and the Note, 
including any portion of the Note, or any derivative of the Note or any 
portion of the Note.
    This Guaranty shall cease to be effective with respect to the 
guaranteed amount of the total amount of the Note (the ``Guaranteed Loan 
Amount'') or with respect to the guaranteed amount of any portion of the 
Note (the ``Guaranteed Loan Portion Amount'') [or with respect to the 
amount of any derivative or derivatives of the Note or any portion of 
the Note equal, or in the aggregate equal, in principal amount to the 
total amount of the Note or such portion of the Note, as the case may 
be, which amount of such derivative or derivatives is equal to the 
respective Guaranteed Loan Amount or Guaranteed Loan Portion Amount, as 
the case may be (the ``Guaranteed-Amount Equivalent'')] to the extent 
that (1) the Guaranteed Loan Amount or the respective Guaranteed Loan 
Portion Amount [or the respective Guaranteed-Amount Equivalent], as the 
case may be, is at any time separated from the unguaranteed amount of 
the total amount of the Note or the unguaranteed amount of the 
respective portion of the Note [or the amount of such derivative or 
derivatives of the Note which is not the amount which is equal to the 
Guaranteed Loan Amount or Guaranteed Loan Portion Amount, as the case 
may be], in any way, (a) directly, or (b) through the issuance of 
participation shares of, or undivided ownership or other equity 
interests in, the Note, or any portion of the Note, or any derivative of 
the Note or any portion of the Note, which have an exclusive or 
preferred claim to the Guaranteed Loan Amount or the respective 
Guaranteed Loan Portion Amount [or the respective Guaranteed-Amount 
Equivalent], as the case may be [or (c) through the issuance of

[[Page 293]]

notes, bonds or other debt instruments or obligations which are 
collateralized or otherwise secured by a pledge of, or security interest 
in, the Note, or any portion of the Note or any derivative of the Note 
or any portion of the Note, which has an exclusive or preferred claim to 
the Guaranteed Loan Amount or the respective Guaranteed Loan Portion 
Amount or the respective Guaranteed-Amount Equivalent, as the case may 
be]; or (2) any holder of the Note, or any portion of the Note, or any 
derivative of the Note or any portion of the Note, as the case may be, 
having claim to payment made on the Note, receives more than ninety 
percent of any payment due to such holder from payments made under this 
Guaranty at any time during the term of the Note or the Agreement.
    This Guaranty is fully and freely transferable to any Permitted 
Guaranty Holder, except that it shall cease to be effective with respect 
to the Agreement or the Note, or any portion of the Note, or any 
derivative of the Note or any portion of the Note, to the extent that 
the Agreement or the Note, or the respective portion of the Note, or the 
respective derivative of the Note or any portion of the Note, as the 
case may be, is used to provide significant support for any non-
registered obligation.
    The full faith and credit of the United States is pledged to the 
performance of this Guaranty. No claim which the United States may now 
or hereafter have against the Lender or any Permitted Guaranty Holder 
for any reason whatsoever shall affect in any way the right of the 
Lender or any Permitted Guaranty Holder to receive full and prompt 
payment of any amount otherwise due under this Guaranty. The United 
States represents and warrants that (a) it has full power, authority and 
legal right to execute, deliver and perform this Guaranty, (b) this 
Guaranty has been executed in accordance with and pursuant to the terms 
and provisions of section 24 of the Act, the provisions of the Foreign 
Operations, Export Financing, and Related Programs Appropriations Act, 
1988, under the hearing ``Foreign Military Sales Debt Reform,'' and 
title 31, part 25, of the Code of Federal Regulations, (c) this Guaranty 
has been duly executed and delivered by a duly authorized representative 
of DSAA, and (d) this Guaranty constitutes the valid and legally binding 
obligations of the United States, enforceable in accordance with the 
terms hereof.
    Any notice, demand, or other communication hereunder shall be deemed 
to have been given if in writing and actually delivered to the 
Comptroller, DSAA, the Pentagon, Washington, DC 20301-2800, or the 
successor, or such other place as may be designated in writing by the 
Comptroller, DSAA or the successor thereof.
    By acceptance of the Note, the Lender agrees to the terms and 
conditions of this Guaranty.

Dated:__________________________________________________________________

By:_____________________________________________________________________
    Director, DSAA.

    (b) The obligations of DSAA under the Guaranty are expressly limited 
to those obligations contained in the form of Guaranty set forth in 
paragraph (a) of this section. Any provisions of any agreement relating 
to the Private Loan purporting to create obligations on the part of DSAA 
which are inconsistent with the terms of the Guaranty or any other 
provision of this part be unenforceable against DSAA.



Sec. 25.406  Savings clause.

    Nothing in this rule is intended to authorize any person or entity 
to engage in any activity not otherwise authorized or permitted for such 
person or entity under any applicable laws of the United States, any 
territory or possession of the United States, any State, or the District 
of Columbia.



PART 26--ENVIRONMENTAL REVIEW OF ACTIONS BY MULTILATERAL DEVELOPMENT BANDS (MDBs)--Table of Contents




Sec.
26.1  Purpose.
26.2  Availability of project listings.
26.3  Availability of Environmental Impact Assessment Summaries (EIA 
          Summaries) and Environmental Impact Assessments (EIAs).
26.4  Comments on MDB projects.
26.5  Upgrades and additional environmental information.

    Authority: 22 U.S.C. 262m-7, 31 U.S.C. 321.

    Source: 57 FR 24545, June 10, 1992.



Sec. 26.1  Purpose.

    This part prescribes procedures for the environmental review of, and 
comment by Federal agencies and the public on, proposed projects of 
multilateral development banks (MDBs).



Sec. 26.2  Availability of project listings.

    (a) The Office of Multilateral Development Banks of the Department 
of the Treasury (hereinafter ``MDB Office'') will ensure that the 
Environmental Protection Agency (EPA), the Council on Environmental 
Quality

[[Page 294]]

(CEQ), the Department of State, the Agency for International Development 
(AID), the National Oceanic and Atmospheric Administration (NOAA), and 
the Bank Information Center (BIC) (which is a private, nongovernmental 
organization located in Washington, DC), receive copies from each 
multilateral development bank (MDB) of project listings describing 
future MDB projects and assigning environmental categories based on the 
environmental impact of each project. If an MDB has not provided a 
project listing to one of these entities, these entities may obtain the 
project listing by contacting the MDB Office, 1500 Pennsylvania Avenue 
NW., Washington, DC 20220, (202) 622-0765.
    (b)(1) Members of the public may obtain copies of project listings 
from the BIC, 2025 Eye Street NW., suite 522, Washington, DC 20006 
((202) 466-8191, not a toll-free call).
    (2) If a copy is not available from the BIC, members of the public 
may arrange to review and/or copy a project listing by contacting the 
MDB Office which will make a copy available at the Department of the 
Treasury Library, 1500 Pennsylvania Avenue NW., Washington, DC ((202) 
622-0990, not a toll-free call). Members of the public are advised that 
they must make an appointment with the Treasury Library before they 
visit and that a charge (currently 15 cents per page) is imposed for the 
use of the library photocopier.



Sec. 26.3  Availability of Environmental Impact Assessment Summaries (EIA Summaries) and Environmental Impact Assessments (EIAs).

    (a) EIA summaries. (1) The MDB Office will provide for the 
distribution of EIA Summaries to the entities identified in section 
26.2(a).
    (2) (i) Members of the public may obtain copies of EIA Summaries 
from the BIC, 2025 Eye Street, NW., suite 522, Washington, DC 20006 
((202) 466-8191, not a toll-free call).
    (ii) If a copy of an EIA Summary is not available from the BIC, 
members of the public may arrange to review and/or copy an EIA Summary 
by contacting the MDB Office at (202) 622-0765 (not a toll-free call), 
which will make a copy available at the Department of the Treasury 
Library, 1500 Pennsylvania Avenue NW., Washingon, DC. Members of the 
public are advised that they must make an appointment with the Treasury 
Library (202) 622-0990) before they visit, and that a charge (currently 
15 cents per page) is imposed for the use of the library photocopier. To 
the extent possible, EIA Summaries will be available for review and 
copying at least 120 days before scheduled consideration of a project by 
the MDB Executive Directors.
    (b) EIAs--(1) The African Development Bank, the European Bank for 
Reconstruction and Development, and the Asian Development Bank. 
Arrangements to review an EIA may be made by contacting the MDB Office 
((202) 622-0765 (not a toll-free call)), which will obtain a copy of the 
EIA through the Office of the United States Executive Director of the 
appropriate MDB and make it available for review and copying in the 
Department of the Treasury Library. Members of the public are advised 
that they must make an appointment with the Treasury Library, ((202) 
622-0900 (not a toll-free call), before they visit, and that a charge 
(currently 15 cents per page) is imposed for the use of the library 
photocopier.
    (2) The International Bank for Reconstruction and Development, the 
International Development Association, and the Inter-American 
Development Bank. (i) Members of the public may review EIAs at the 
public reading room of the concerned MDB.
    (ii) If a particular MDB does not have a public reading room, 
members of the public may arrange to review and/or copy an EIA by 
contacting the MDB Office ((202) 622-0765 (not a toll-free call)), which 
will obtain a copy through the Office of the United States Executive 
Director of the concerned MDB and make it available in the Department of 
the Treasury Library, 1500 Pennsylvania Avenue NW., Washington, DC. 
Members of the public are advised that they must make an appointment 
with the Treasury Library ((202) 622-0990 not a toll-free call) before 
they visit, and that a charge (currently 15 cents per page) is imposed 
for the use of the library photocopier.

[[Page 295]]



Sec. 26.4  Comments on MDB projects.

    (a) Public comments--(1) Written comments (i) A member of the public 
wishing to provide written comments on a MDB project must provide 2 
copies of the comments to the Office of Multilateral Development Banks, 
U.S. Department of the Treasury, 1500 Pennsylvania Avenue NW., room 
5400, Washington, DC 20220. Written comments should be submitted not 
later than two weeks after the member of the public has access to the 
particular document on which it wishes to offer comments--either the 
project listing, the EIA Summary, or the EIA for a particular project. 
Written public comments will be provided by the MDB Office to the U.S. 
Government agencies participating in meetings of the Working Group for 
Multilateral Assistance (WGMA), which meetings are described in 
Sec. 26.4(c). The WGMA is an intergovernmental subcommittee of the 
Development Coordination Committee whose functions are set forth in the 
Presidential announcement of May 19, 1978, Vol. 14, No. 20, p. 932 of 
the Weekly Compilation of Presidential Documents. The WGMA meets to 
discuss the U.S. position on upcoming MDB projects.
    (ii) All written comments will be available for inspection and 
copying in their entirety in the Department of the Treasury Library, 
1500 Pennsylvania Avenue NW., Washington, DC ((202) 622-0990). Members 
of the public are advised that they must make an appointment with the 
Treasury Library before they visit, and that a charge (currently 15 
cents per page) is imposed for the use of the library photocopier.
    (2) Oral comments. Oral comments from a member of the public may be 
made in periodic meetings convened by the BIC. Information concerning 
these meetings may be obtained by contacting the BIC or the MDB Office. 
The MDB Office will summarize and present such comments in the WGMA 
meetings described in Sec. 26.4(c).
    (b) U.S. agency comments. Comments from U.S. agencies shall be 
provided through the WGMA.
    (c) Consideration of comments. The WGMA will consider all comments 
made by the public and U.S. agencies. The WGMA may review a project up 
to three times. The first review will consider whether the project has 
been assigned the appropriate environmental category by the MDB. This 
review will take place as far in advance as possible of Board 
consideration of the project. The second review will consider the EIA 
Summary or the EIA (or information discussed in Sec. 26.5(b)(1)), and 
comments received from the public on such documentation. The third WGMA 
review, which will take place shortly before Board consideration of the 
project, will consider the position of the U.S. Government on the 
project.



Sec. 26.5  Upgrades and additional environmental information.

    (a) Environmental category upgrades. If the WGMA and the Department 
of the Treasury determine that a project would have a significant impact 
on the human environment, but that the level of environmental analysis 
planned by the MDB is insufficient, the Department of the Treasury will 
instruct the United States Executive Director of the concerned MDB to 
request that the MDB upgrade the project to an environmental category 
requiring additional environmental analysis. Members of the public may 
call the MDB Office to inquire about upgrade requests for specific 
projects.
    (b) Additional environmental information. (1) If the WGMA and the 
Department of the Treasury determine on the basis of the first WGMA 
review that:
    (i) A MDB project would have a significant impact on the human 
environment, and
    (ii) The MDB appears to have made an appropriate decision that such 
project merits environmental analysis, but less than a full-fledged 
environmental impact assessment as defined by that MDB's own procedures, 
the Department of the Treasury will obtain, through the United States 
Executive Director of the concerned MDB, such environmental information 
from the MDB (e.g., environmental chapters from project feasibility 
studies or environmental data sheets) which contains this environmental 
analysis. The MDB Office will provide this environmental information to 
the entities described in Sec. 26.2(a).

[[Page 296]]

    (2) If such environmental information is insufficient to provide an 
adequate basis for analyzing the environmental impact of the proposed 
project and alternatives to the proposed project, the Department of the 
Treasury will instruct the United States Executive Director of the 
concerned MDB not to vote in favor of the project.



PART 27--CIVIL PENALTY ASSESSMENT FOR MISUSE OF DEPARTMENT OF THE TREASURY NAMES, SYMBOLS, ETC.--Table of Contents




Sec.
27.1  Purpose.
27.2  Definitions.
27.3  Assessment of civil penalties.
27.4  Factors to be considered.
27.5  Initial Notice of Assessment.
27.6  Written response.
27.7  Final Notice of Assessment.
27.8  Judicial review.

    Authority: 31 U.S.C. 321, 333.

    Source: 62 FR 42213, Aug. 6, 1997, unless otherwise noted.



Sec. 27.1  Purpose.

    (a) The regulations in this part implement the provisions of 31 
U.S.C. 333(c), which authorizes the Secretary of the Treasury to assess 
a civil penalty against any person who has misused the words, titles, 
abbreviations, initials, symbols, emblems, seals, or badges of the 
Department of the Treasury or any subdivision thereof in violation of 31 
U.S.C. 333(a), in accordance with that section and this part.
    (b) The regulations in this part do not apply to the extent that the 
Secretary or his/her designee has specifically authorized the person to 
manufacture, produce, sell, possess, or use the words, titles, 
abbreviations, initials, symbols, emblems, seals, or badges by written 
contract, agreement, or letter.



Sec. 27.2  Definitions.

    (a) The term ``assessing official'' means:
    (1) The head of a bureau or other subdivision of the Department of 
the Treasury who has been delegated the authority to assess civil 
penalties under 31 U.S.C. 333(c); or
    (2) An officer or employee of a bureau or subdivision at the grade 
of GS-15 or above to whom such authority has been redelegated by the 
head of such bureau or subdivision.
    (b) The term ``broadcast'' or ``telecast'' mean widespread 
dissemination by electronic transmission or method, whether audio and/or 
visual.
    (c) The term ``civil penalty'' means:
    (1) A civil monetary penalty; and
    (2) Any other civil or equitable remedy deemed necessary to rectify 
the potential for a continued misuse or harm from an activity found to 
have been in violation of 31 U.S.C. 333 or this part.
    (d) The term ``date of offense'' means the later of--
    (1) The date that the misuse occurred;
    (2) The date that the misuse had the effect of conveying the false 
impression that the activity was associated with or approved, endorsed, 
sponsored or authorized by the Department or any of its subdivisions or 
officers or employees; or
    (3) If the violation is a continuing one, the date on which the 
misuse of the words, titles, abbreviations, initials, symbols, emblems, 
seals, or badges protected by this part last occurred.
    (e) The term ``days'' means calendar days, unless otherwise stated.
    (f) The term ``person'' means an individual, partnership, 
association, corporation, company, business, firm, manufacturer, or any 
other organization or institution.



Sec. 27.3  Assessment of civil penalties.

    (a) General Rule. An assessing official may impose a civil penalty 
on any person--
    (1) Who uses in connection with, or as a part of, any advertisement, 
solicitation, business activity, or product, whether alone or with other 
words, letters, symbols, or emblems;
    (i) The words ``Department of the Treasury,'' ``United States Secret 
Service,'' ``United States Customs Service,'' ``Internal Revenue 
Service,'' ``Bureau of Alcohol, Tobacco and Firearms,'' ``Bureau of the 
Public Debt,'' ``Bureau of Engraving and Printing,'' ``Comptroller of 
the Currency,'' ``Federal Law

[[Page 297]]

Enforcement Training Center,'' ``Financial Crimes Enforcement Network,'' 
``United States Mint,'' or the name of any service, bureau, office, or 
other subdivision of the Department of the Treasury;
    (ii) The titles ``Secretary of the Treasury,'' ``Treasurer of the 
United States,'' ``Director of the Secret Service,'' ``Commissioner of 
Customs,'' ``Commissioner of Internal Revenue,'' ``Director, Bureau of 
Alcohol, Tobacco and Firearms,'' ``Commissioner of the Public Debt,'' 
``Director of the Bureau of Engraving and Printing,'' ``Comptroller of 
the Currency,'' ``Director of the Federal Law Enforcement Training 
Center,'' ``Director of the Financial Crimes Enforcement Network,'' 
``Director of the United States Mint,'' or the title of any other 
officer or employee of the Department of the Treasury or subdivision 
thereof;
    (iii) The abbreviations or initials of any entity or title referred 
to in paragraph (a)(1)(i) or (a)(1)(ii) of this section, including but 
not limited to ``USSS,'' ``USCS,'' ``IRS,'' ``ATF,'' or ``BATF,'' 
``BPD,'' ``FLETC,'' ``FINCEN'' or ``FinCEN,''and ``SBMO'';
    (iv) The words ``United States Savings Bond,'' including any 
variation thereof, or the name of any other security, obligation, or 
financial instrument issued by the Department of the Treasury or any 
subdivision thereof;
    (v) Any symbol, emblem, seal, or badge of an entity referred to in 
paragraph (a)(1)(i) of this section (including the design of any 
envelope, stationery, or identification card used by such an entity); or
    (vi) Any colorable imitation of any such words, titles, 
abbreviations, initials, symbol, emblem, seal, or badge; and
    (2) Where such use is in a manner that could reasonably be 
interpreted or construed as conveying the false impression that such 
advertisement, solicitation, business activity, or product is in any 
manner approved, endorsed, sponsored, or authorized by, or associated 
with the Department of the Treasury or any entity referred to in 
paragraph (a)(1)(i) of this section, or any officer, or employee 
thereof.
    (b) Disclaimers. Any determination of whether a person has violated 
the provisions of paragraph (a) of this section shall be made without 
regard to any use of a disclaimer of affiliation with the United States 
Government or any particular agency or instrumentality thereof.
    (c) Civil Penalty. An assessing official may impose a civil penalty 
on any person who violates the provisions of paragraph (a) of this 
section. The amount of a civil monetary penalty shall not exceed $5,000 
for each and every use of any material in violation of paragraph (a), 
except that such penalty shall not exceed $25,000 for each and every use 
if such use is in a broadcast or telecast.
    (d) Time Limitations. (1) Civil penalties imposed under this part 
must be assessed before the end of the three year period beginning on 
the date of offense charged.
    (2) An assessing official may commence a civil action to recover or 
enforce any civil penalty imposed in a Final Notice of Assessment issued 
pursuant to Sec. 27.7 at any time before the end of the two year period 
beginning on the date of the Final Notice of Assessment. If judicial 
review of the Final Notice of Assessment is sought, the two year period 
begins to run from the date that a final and unappealable court order is 
issued.
    (e) Criminal Proceeding. No civil penalty may be imposed under this 
part with respect to any violation of paragraph (a) of this section 
after a criminal proceeding on the same violation has been commenced by 
indictment or information under 31 U.S.C. 333(d).



Sec. 27.4  Factors to be considered.

    The assessing official will consider relevant factors when 
determining whether to assess or impose a civil penalty under this part, 
and the amount of a civil monetary penalty. Those factors may include, 
but are not limited to, the following:
    (a) The scope of the misuse;
    (b) The purpose and/or nature of the misuse;
    (c) The extent of the harm caused by the misuse;
    (d) The circumstances of the misuse; and
    (e) The benefit intended to be derived from the misuse.

[[Page 298]]



Sec. 27.5  Initial Notice of Assessment.

    The assessing official shall serve an Initial Notice of Assessment 
by United States mail or other means upon any person believed to be in 
violation of Sec. 27.3 and otherwise subject to a civil penalty. The 
notice shall provide the name and telephone number of an agency officer 
or employee who can provide information concerning the notice and the 
provisions of this part, and shall include the following:
    (a) A specific reference to the provisions of Sec. 27.3 violated;
    (b) A concise statement of the facts that support the conclusion 
that such a violation occurred;
    (c) The amount of the penalty proposed, and/or any other proposed 
civil or equitable remedy;
    (d) A notice informing the person alleged to be in violation of 
Sec. 27.3 that he/she:
    (1) May, within 30 days of the date of the notice, pay the proposed 
civil monetary penalty and consent to each proposed civil or equitable 
remedy, thereby waiving the right to make a written response under 
Sec. 27.6 and to seek judicial review under Sec. 27.8:
    (i) By electronic funds transfer (EFT) in accordance with 
instructions provided in the notice, or
    (ii) By means other than EFT only with the written approval of the 
assessing official;
    (2) May make a written response within 30 days of the date of the 
notice asserting, as appropriate:
    (i) Why a civil monetary penalty and/or other civil or equitable 
remedy should not be imposed;
    (ii) Why a civil monetary penalty should be in a lesser amount than 
proposed; and
    (iii) Why the terms of a proposed civil or equitable remedy should 
be modified;
    (3) May be represented by an attorney or other representative, 
provided that a designation of representative signed by the person 
alleged to be in violation is received by the assessing official; and
    (4) May request, within 20 days of the date of the notice, a copy of 
or opportunity to review any documents and/or other evidence compiled 
and relied on by the agency in determining to issue the notice (the 
assessing official reserves the right to assert privileges available 
under law and may decline to disclose certain documents and/or other 
evidence); and
    (e) The Initial Notice of Assessment shall also inform the person 
that:
    (1) If no written response is received within the time allowed in 
Sec. 27.6(b), a Final Notice of Assessment may be issued without a 
presentation by the person;
    (2) If a written response has been made and it is deemed necessary, 
the assessing official may request, orally or in writing, additional 
information from the respondent;
    (3) A Final Notice of Assessment may be issued in accordance with 
Sec. 27.7 requiring that the civil monetary penalty be paid and 
compliance with the terms of any other civil or equitable remedy;
    (4) A Final Notice of Assessment is subject to judicial review in 
accordance with 5 U.S.C. 701 et seq.; and
    (5) All submissions sent in response to the Initial
    Notice of Assessment must be transmitted to the address specified in 
the notice and include the name, address, and telephone number of the 
respondent.



Sec. 27.6  Written response.

    (a)(1) A person served with an Initial Notice of Assessment may make 
a written response explaining why the civil penalty should not be 
imposed, explaining why a civil monetary penalty should be in a lesser 
amount than proposed and/or explaining why the terms of a proposed civil 
or equitable remedy should be modified. The written response must 
provide:
    (i) A reference to and specifically identify the Initial Notice of 
Assessment involved;
    (ii) The full name of the person charged;
    (iii) If not a natural person, the name and title of the head of the 
organization charged; and
    (iv) If a representative of the person charged is filing the written 
response, a copy of the duly executed designation as representative.
    (2) The written response must admit or deny each violation of 
Sec. 27.3 charged

[[Page 299]]

in the Initial Notice of Assessment. Any charge not specifically denied 
will be presumed to be admitted. Where a charge is denied, the 
respondent shall specifically set forth the legal or factual basis upon 
which the charge is denied. If the basis of the written response is that 
the person charged is not the person responsible for the misuse(s) 
charged, the written response must set forth sufficient information to 
allow the agency to determine the truth of such an assertion. The 
written response should include any and all documents and/or other 
information that the respondent believes should be a part of the 
administrative record on the matter.
    (b) Time. (1) Except as provided in paragraph (b)(2) of this 
section, any written response made under this paragraph must be received 
not later than 30 days after the date of the Initial Notice of 
Assessment.
    (2) If a request for documents or other evidence is made pursuant to 
Sec. 27.5(d)(4), the written response must be received not later than 20 
days after the date of the Department's response to the request.
    (3)(i) In computing the number of days allowed for filing a written 
response under this paragraph, the first day counted is the day after 
the date of the Initial Notice of Assessment. If the last date on which 
the response is required to be filed by this paragraph is a Saturday, 
Sunday or Federal holiday, the response will be due on the next weekday 
after that date.
    (ii) If a response is transmitted by United States mail, it will be 
deemed timely filed if postmarked on or before the due date.
    (4) The assessing official may extend the period for making a 
written response under paragraphs (b)(1) and (b)(2) for good cause 
shown. Generally, failure to obtain representation in a timely manner 
will not be considered good cause.
    (c) Filing. A written response will be considered filed on the date 
received at the address specified in the Initial Notice of Assessment. 
The response may be sent by personal delivery, United States mail or 
commercial delivery. At the discretion of the assessing official, filing 
may be accomplished by facsimile or any other method deemed appropriate.
    (d) The assessing official will fully consider the facts and 
arguments submitted by the respondent in the written response and any 
other documents filed pursuant to this paragraph in determining whether 
to issue a Final Notice of Assessment under Sec. 27.7, the appropriate 
amount of the civil monetary penalty imposed and the terms of any other 
appropriate civil or equitable remedy.



Sec. 27.7  Final Notice of Assessment.

    (a) In making a final determination whether to impose a penalty, the 
assessing official shall take into consideration all available 
information in the administrative record on the matter, including all 
information provided in or with a written response timely filed by the 
respondent and any additional information provided pursuant to 
Sec. 27.5(e)(2). The assessing official will determine whether:
    (1) The facts warrant a conclusion that no violation has occurred; 
or
    (2) The facts warrant a conclusion that one or more violations have 
occurred; and
    (3) The facts and violations found justify the conclusion that a 
civil penalty should be imposed.
    (b) If the assessing official determines that no violation has 
occurred, the official shall promptly send a letter indicating that 
determination to the person served with an Initial Notice of Assessment 
and to any designated representative of such person.
    (c)(1) If it has been determined that a violation has occurred, the 
assessing official shall issue a Final Notice of Assessment to the 
person served with an Initial Notice of Assessment and to any designated 
representative of such person.
    (2) The assessing official may, in his/her discretion:
    (i) Impose a civil monetary penalty and/or any civil or equitable 
remedy deemed necessary to rectify the potential for a continued misuse 
or harm from the violation(s);
    (ii) Not impose a civil monetary penalty and/or civil or equitable 
remedy; or

[[Page 300]]

    (iii) Impose a civil monetary penalty and/or civil or equitable 
remedy and condition payment of the civil monetary penalty on the 
violator's future compliance with 31 U.S.C. 333, this part and any civil 
or equitable remedy contained in the Final Notice of Assessment. If a 
civil monetary penalty is imposed, the assessing official shall 
determine the appropriate amount of the penalty in accordance with 31 
U.S.C. 333(c)(2).
    (3) The Final Notice of Assessment shall:
    (i) Include:
    (A) A specific reference to the provisions of Sec. 27.3 found to 
have been violated;
    (B) A concise statement of the facts warranting a conclusion that a 
violations has occurred;
    (C) An analysis of how the facts and violation(s) justify the 
conclusion that a civil monetary penalty and/or civil or equitable 
remedy should be imposed; and
    (D) The amount of each civil monetary penalty imposed, a statement 
as to how the amount of each penalty was determined, and the terms of 
any civil or equitable remedy deemed necessary to rectify the potential 
for a continued misuse or harm from the violation(s); and
    (ii) Inform the person that:
    (A) Payment of a civil monetary penalty imposed by the Final Notice 
of Assessment must be made within 30 days of the date of the notice, and 
that any civil or equitable remedy imposed must be complied with as 
provided in the Final Notice of Assessment;
    (B) Payment of a civil monetary penalty imposed by the Final Notice 
of Assessment shall be by EFT in accordance with instructions provided 
in the notice, unless the assessing official has given written approval 
to have payment made by other means;
    (C) payment of a civil monetary penalty imposed by the Final Notice 
of Assessment constitutes consent by the person to comply with the terms 
of any civil or equitable remedy contained in the notice;
    (D) If payment of a civil monetary penalty imposed by the Final 
Notice of Assessment has been waived on the condition that the person 
comply with the terms of any civil or equitable remedy contained in the 
notice or comply in the future with 31 U.S.C. 333 and this part, failure 
by the person to so comply will make the civil monetary penalty payable 
on demand;
    (E) If a civil monetary penalty is not paid within 30 days of the 
date of the Final Notice of Assessment (or on demand under paragraph 
(C)(3)(ii)(D) of this sectiion), or if a civil or equitable remedy is 
not complied with in accordance with the terms of the notice, a civil 
action to collect the penalty or enforce compliance may be commenced at 
any time within two years of the date of the Final Notice of Assessment; 
and
    (F) Any civil monetary penalty and civil or equitable remedy imposed 
by the Final Notice of Assessment may be subject to judicial review in 
accordance with 5 U.S.C. 701 et seq.

[62 FR 42213, Aug. 6, 1997; 62 FR 44036, Aug. 18, 1997]



Sec. 27.8  Judicial review.

    A final Notice of Assessment issued under this party may be subject 
to judicial review pursuant to 5 U.S.C. 701 et seq.

[[Page 301]]

          Subtitle B--Regulations Relating to Money and Finance

[[Page 303]]



                      CHAPTER I--MONETARY OFFICES,






                       DEPARTMENT OF THE TREASURY




  --------------------------------------------------------------------
Part                                                                Page
56              Domestic gold and silver operations sale of 
                    silver..................................         305
91              Regulations governing conduct in or on the 
                    Bureau of the Mint buildings and grounds         305
92              Bureau of the Mint operations and procedures         307
100             Exchange of paper currency and coin.........         308
101             Mitigation of forfeiture of counterfeit gold 
                    coins...................................         312
103             Financial recordkeeping and reporting of 
                    currency and foreign transactions.......         314
123

[Reserved]

128             Reporting of international capital and 
                    foreign-currency transactions and 
                    positions...............................         373
129             Portfolio investment survey reporting.......         377
130-199

[Reserved]


Abbreviation:
    The following abbreviation is used in this chapter:
        C. P. D.=Commissioner of the Public Debt.

[[Page 305]]



PART 56--DOMESTIC GOLD AND SILVER OPERATIONS SALE OF SILVER--Table of Contents




Sec.
56.1  Conditions upon which silver will be sold.
56.2  Sales price.

    Authority: Sec. 209, 79 Stat. 257; 31 U.S.C. 405a-1.



Sec. 56.1  Conditions upon which silver will be sold.

    The General Services Administration, as agent for the Treasury 
Department, will conduct periodic sales of silver as agreed upon between 
GSA and the Treasury Department. Sales will be under competitive bidding 
procedures established by agreement between GSA and the Treasury 
Department. Details of the bidding and selling procedures are obtainable 
by telephone or by writing to General Services Administration, Property 
Management and Disposal Service, Industry Materials Division, Metals 
Project, Washington, DC 20405.

[32 FR 13380, Sept. 22, 1967]



Sec. 56.2  Sales price.

    Sales of silver will be at prices offered through the competitive 
bidding procedures referred to in Sec. 56.1, and accepted by the GSA.

[32 FR 13380, Sept. 22, 1967]



PART 91--REGULATIONS GOVERNING CONDUCT IN OR ON THE BUREAU OF THE MINT BUILDINGS AND GROUNDS--Table of Contents




Sec.
91.1  Authority.
91.2  Applicability.
91.3  Recording presence.
91.4  Preservation of property.
91.5  Compliance with signs and directions.
91.6  Nuisances.
91.7  Gambling.
91.8  Alcoholic beverages, narcotics, hallucinogenic and dangerous 
          drugs.
91.9  Soliciting, vending, debt collection, and distribution of 
          handbills.
91.10  Photographs.
91.11  Dogs and other animals.
91.12  Vehicular and pedestrian traffic.
91.13  Weapons and explosives.
91.14  Penalties and other law.

    Authority: 5 U.S.C. 301, by delegation from the Administrator of 
General Services, 35 FR 14426, and Treasury Department Order 177-25 
(Revision 2), 38 FR 21947.

    Source: 34 FR 503, Jan. 14, 1969, unless otherwise noted.



Sec. 91.1  Authority.

    The regulations in this part governing conduct in and on the Bureau 
of the Mint buildings and grounds located as follows: U.S. Mint, Colfax, 
and Delaware Streets, Denver, Colorado; U.S. Bullion Depository, Fort 
Knox, Kentucky; U.S. Assay Office, 32 Old Slip New York, New York; U.S. 
Mint, 5th and Arch Streets, Philadelphia, Pennsylvania; U.S. Assay 
Office, 155 Hermann Street, and the Old U.S. Mint Building, 88 Fifth 
Street, San Francisco, California; and U.S. Bullion Depository, West 
Point, New York; are promulgated pursuant to the authority vested in the 
Secretary of the Treasury, including 5 U.S.C. 301, and that vested in 
him by delegation from the Administrator of General Services, 38 FR 
20650 (1973), and in accordance with the authority vested in the 
Director of the Mint by Treasury Department Order No. 177-25 Revision 
2), dated August 8, 1973, 38 FR 21947 (1973).

[38 FR 24897, Sept. 11, 1973]



Sec. 91.2  Applicability.

    The regulations in this part apply to the buildings and grounds of 
the Bureau of the Mint located as follows: U.S. Mint, Colfax and 
Delaware Streets, Denver, Colorado; U.S. Bullion Depository, Fort Knox, 
Kentucky; U.S. Assay Office, 32 Old Slip, New York, New York; U.S. Mint, 
Fifth and Arch Streets, Philadelphia, Pennsylvania; U.S. Assay Office, 
155 Hermann Street, and the Old U.S. Mint Building, 88 Fifth Street, San 
Francisco, California; and U.S. Bullion Depository, West Point, New 
York; and to all persons entering in or on such property. Unless 
otherwise stated herein, the Bureau of the Mint buildings and grounds 
shall be referred to in these regulations as the ``property''.

[38 FR 24897, Sept. 11, 1973]

[[Page 306]]



Sec. 91.3  Recording presence.

    Except as otherwise ordered, the property shall be closed to the 
public during other than normal working hours. The property shall also 
be closed to the public when, in the opinion of the senior supervising 
official of any Bureau of the Mint establishment covered by these 
regulations, or his delegate, an emergency situation exists, and at such 
other times as may be necessary for the orderly conduct of the 
Government's business. Admission to the property during periods when 
such property is closed to the public will be limited to authorized 
individuals who will be required to sign the register and/or display 
identification documents when requested by the guard.



Sec. 91.4  Preservation of property.

    It shall be unlawful for any person without proper authority to 
wilfully destroy, damage, deface, or remove property or any part thereof 
or any furnishings therein.



Sec. 91.5  Compliance with signs and directions.

    Persons in and on the property shall comply with the instructions of 
uniformed Bureau of the Mint guards (U.S. Special Policemen), other 
authorized officials, and official signs of a prohibitory or directory 
nature.



Sec. 91.6  Nuisances.

    The use of loud, abusive, or profane language, unwarranted 
loitering, unauthorized assembly, the creation of any hazard to persons 
or things, improper disposal of rubbish, spitting, prurient prying, the 
commission of any obscene or indecent act, or any other disorderly 
conduct on the property is prohibited. The throwing of any articles of 
any kind in, upon, or from the property and climbing upon any part 
thereof, is prohibited. The entry, without specific permission, upon any 
part of the property to which the public does not customarily have 
access, is prohibited.



Sec. 91.7  Gambling.

    (a) Participating in games for money or other property, the 
operation of gambling devices, the conduct of a lottery or pool, the 
selling or purchasing of numbers tickets, or any other gambling in or on 
the property, is prohibited.
    (b) Possession in or on the property of any numbers slip or ticket, 
record, notation, receipt, or other writing of a type ordinarily used in 
any illegal form of gambling such as a tip sheet or dream book, unless 
explained to the satisfaction of the head of the bureau or his delegate, 
shall be prima facie evidence that there is participation in an illegal 
form of gambling in or on such property.

[34 FR 503, Jan. 14, 1969, as amended at 36 FR 3523, Feb. 26, 1971]



Sec. 91.8  Alcoholic beverages, narcotics, hallucinogenic and dangerous drugs.

    Entering or being on the property, or operating a motor vehicle 
thereon by a person under the influence of alcoholic beverages, 
narcotics, hallucinogenic or dangerous drugs is prohibited. The use of 
any narcotic, hallucinogenic or dangerous drug in or on the property is 
prohibited. The use of alcoholic beverages in or on the property is 
prohibited except on occasions and on property upon which the Director 
of the Mint has for appropriate official uses granted and exemption 
permit in writing.

[38 FR 24898, Sept. 11, 1973]



Sec. 91.9  Soliciting, vending, debt collection, and distribution of handbills.

    The unauthorized soliciting of alms and contributions, the 
commercial soliciting and vending of all kinds, the display or 
distribution of commercial advertising, or the collecting of private 
debts, in or on the property, is prohibited. This rule does not apply to 
Bureau of the Mint concessions or notices posted by authorized employees 
on the bulletin boards. Distribution of material such as pamphlets, 
handbills, and flyers is prohibited without prior approval from the 
Director of the Mint, or the delegate of the Director.



Sec. 91.10  Photographs.

    The taking of photographs on the property is prohibited, without the 
written permission of the Director of the Mint.

[[Page 307]]



Sec. 91.11  Dogs and other animals.

    Dogs and other animals, except seeing-eye dogs, shall not be brought 
upon the property for other than official purposes.



Sec. 91.12  Vehicular and pedestrian traffic.

    (a) Drivers of all vehicles in or on the property shall drive in a 
careful and safe manner at all times and shall comply with the signals 
and directions of guards and all posted traffic signs.
    (b) The blocking of entrances, driveways, walks, loading platforms, 
or fire hydrants in or on the property is prohibited.
    (c) Parking in or on the property is not allowed without a permit or 
specific authority. Parking without authority, parking in unauthorized 
locations or in locations reserved for other persons or continuously in 
excess of 8 hours without permission, or contrary to the direction of a 
uniformed Bureau of the Mint guard, or of posted signs, is prohibited.
    (d) This paragraph may be supplemented from time to time with the 
approval of the Director of the Mint, or the delegate of the Director, 
by the issuance and posting of such specific traffic directives as may 
be required and when so issued and posted such directives shall have the 
same force and effect as if made a part hereof.



Sec. 91.13  Weapons and explosives.

    No person while on the property shall carry firearms, other 
dangerous or deadly weapons, or explosives, either openly or concealed, 
except for official purposes.



Sec. 91.14  Penalties and other law.

    Whoever shall be found guilty of violating any of the regulations in 
this part while on the property is subject to a fine of not more than 
$50, or imprisonment of not more than 30 days, or both (40 U.S.C. 318c). 
Nothing contained in the regulations in this part shall be construed to 
abrogate any other Federal laws or regulations or those of any State or 
municipality applicable to the property referred to in Sec. 91.2 and 
governed by the regulations in this part.



PART 92--BUREAU OF THE MINT OPERATIONS AND PROCEDURES--Table of Contents




Sec.
92.1  Manufacture of medals.
92.2  Sale of ``list'' medals.
92.3  Manufacture and sale of ``proof'' coins.
92.4  Uncirculated Mint Sets.
92.5  Procedure governing availability of Bureau of the Mint records.
92.6  Appeal.

    Authority: 5 U.S.C. 301.

    Source: 47 FR 56353, Dec. 16, 1982, unless otherwise noted.



Sec. 92.1  Manufacture of medals.

    With the approval of the Director of the Mint, dies for medals of a 
national character designated by Congress may be executed at the 
Philadelphia Mint, and struck in such field office of the Mints and 
Assay Offices as the Director shall designate.



Sec. 92.2  Sale of ``list'' medals.

    Medals on the regular Mint list, when available, are sold to the 
public at a charge sufficient to cover their cost, and to include 
mailing cost when mailed. Copies of the list of medals available for 
sale and their selling prices may be obtained from the Director of the 
Mint, Washington, DC.



Sec. 92.3  Manufacture and sale of ``proof'' coins.

    ``Proof'' coins, i.e., coins prepared from blanks specially polished 
and struck, are made as authorized by the Director of the Mint and are 
sold at a price sufficient to cover their face value plus the additional 
expense of their manufacture and sale. Their manufacture and issuance 
are contingent upon the demands of regular operations. Information 
concerning availability and price may be obtained from the Director of 
the Mint, Treasury Department, Washington, DC 20220.



Sec. 92.4  Uncirculated Mint Sets.

    Uncirculated Mint Sets, i.e., specially packaged coin sets 
containing one coin of each denomination struck at the Mints at 
Philadelphia and Denver, and the Assay Office at San Francisco, will be 
made as authorized by the Director of the Mint and will be sold at a 
price sufficient to cover their

[[Page 308]]

face value plus the additional expense of their processing and sale. 
Their manufacture and issuance are contingent upon demands of regular 
operations. Information concerning availability and price may be 
obtained from the Director of the Mint, Treasury Department, Washington, 
DC 20220.



Sec. 92.5  Procedure governing availability of Bureau of the Mint records.

    (a) Regulations of the Office of the Secretary adopted. The 
regulations on the Disclosure of Records of the Office of the Secretary 
and other bureaus and offices of the Department issued under 5 U.S.C. 
301 and 552 and published as part 1 of this title, 32 FR No. 127, July 
1, 1967, except for Sec. 1.7 of this title entitled ``Appeal,'' shall 
govern the availability of Bureau of the Mint records.
    (b) Determination of availability. The Director of the Mint 
delegates authority to the following Mint officials to determine, in 
accordance with part 1 of this title, which of the records or 
information requested is available, subject to the appeal provided in 
Sec. 92.6: The Deputy Director of the Mint, Division Heads in the Office 
of the Director, and the Superintendent or Officer in Charge of the 
field office where the record is located.
    (c) Requests for identifiable records. A written request for an 
identifiable record shall be addressed to the Director of the Mint, 
Washington, DC 20220. A request presented in person shall be made in the 
public reading room of the Treasury Department, 15th Street and 
Pennsylvania Avenue, NW, Washington, DC, or in such other office 
designated by the Director of the Mint.



Sec. 92.6  Appeal.

    Any person denied access to records requested under Sec. 92.5 may 
file an appeal to the Director of the Mint within 30 days after 
notification of such denial. The appeal shall provide the name and 
address of the appellant, the identification of the record denied, and 
the date of the original request and its denial.



PART 100--EXCHANGE OF PAPER CURRENCY AND COIN--Table of Contents




Sec.
100.2  Scope of regulations; transactions ef-fected through Federal 
          Reserve banks and branches; distribution of coin and 
          currencies.

                          Subpart A--In General

100.3  Lawfully held coins and currencies in general.
100.4  Gold coin and gold certificates in general.

             Subpart B--Exchange of Mutilated Paper Currency

100.5  Mutilated paper currency.
100.6  Destroyed paper currency.
100.7  Treasury's liability.
100.8  Packaging of mutilated currency.
100.9  Where mutilated currency should be transmitted.

                       Subpart C--Exchange of Coin

100.10  Exchange of uncurrent coins.
100.11  Exchange of bent and partial coins.
100.12  Exchange of fused and mixed coins.
100.13  Criminal penalties.

                      Subpart D--Other Information

100.16  Exchange of paper and coin to be handled through Federal Reserve 
          banks and branches.
100.17  Location of Federal Reserve banks and branches.
100.18  Counterfeit notes to be marked; ``redemption'' of notes 
          wrongfully so marked.
100.19  Disposition of counterfeit notes and coins.

    Authority: 31 U.S.C. 321.

    Source: 47 FR 32044, July 23, 1982, unless otherwise noted.



Sec. 100.2  Scope of regulations; transactions effected through Federal Reserve banks and branches; distribution of coin and currencies.

    The regulations in this part govern the exchange of the coin and 
paper currency of the United States (including national bank notes and 
Federal Reserve bank notes in process of retirement and Federal Reserve 
notes). Under authorization in the Act approved May 29, 1920, 41 Stat. 
655 (31 U.S.C. 476), the Secretary of the Treasury transferred to the 
Federal Reserve

[[Page 309]]

banks and branches the duties and functions performed by the former 
Assistant Treasurers of the United States in connection with the 
exchange of paper currency and coin of the United States. Except for the 
duties in this respect to be performed by the Treasurer of the United 
States and the Director of the Mint, as may be indicated from time to 
time by the Secretary of the Treasury, exchanges of the paper currency 
and coin of the United States and the distribution and replacement 
thereof will, so far as practicable, be effected through the Federal 
Reserve banks and branches. The Federal Reserve banks and branches are 
authorized to distribute available supplies of coin and currency to 
depository institutions, as that term is defined in section 103 of the 
Monetary Control Act of 1980 (Pub. L. 96-221). As authorized by section 
107 of the Act, transportation of coin and currency and coin wrapping 
services will be provided according to a schedule of fees established by 
the Board of Governors of the Federal Reserve System. Inquiries by 
depository institutions regarding distribution and related services 
should be addressed to the Federal Reserve bank of the district where 
the institution is located.



                          Subpart A--In General



Sec. 100.3  Lawfully held coin and currencies in general.

    The official agencies of the Department of the Treasury will 
continue to exchange lawfully held coins and currencies of the United 
States, dollar for dollar, for other coins and currencies which may be 
lawfully acquired and are legal tender for public and private debts. 
Paper currency of the United States which has been falsely altered and 
coins altered to render them for use as other denominations will not be 
redeemed since such currency and coins are subject to forfeiture under 
Title 18, United States Code, section 492. Persons receiving such 
currency and coins should notify immediately the nearest local office of 
the U.S. Secret Service of the Department of the Treasury, and hold the 
same pending advice from the Service.



Sec. 100.4  Gold coin and gold certificates in general.

    Gold coins, and gold certificates of the type issued before January 
30, 1934, are exchangeable, as provided in this part, into other 
currency or coin which may be lawfully issued.



             Subpart B--Exchange of Mutilated Paper Currency



Sec. 100.5  Mutilated paper currency.

    (a) Lawfully held paper currency of the United States which has been 
mutilated will be exchanged at face amount if clearly more than one-half 
of the original whole note remains. Fragments of such mutilated currency 
which are not clearly more than one-half of the original whole note will 
be exchanged at face value only if the Director, Bureau of Engraving and 
Printing, Department of the Treasury, is satisfied that the missing 
portions have been totally destroyed. The Director's judgment shall be 
based on such evidence of total destruction as is necessary and shall be 
final.

                               Definitions

    (1) Mutilated currency is currency which has been damaged to the 
extent that (i) one-half or less of the original note remains or (ii) 
its condition is such that its value is questionable and the currency 
must be forwarded to the Treasury Department for examination by trained 
experts before any exchange is made.
    (2) Unfit currency is currency which is unfit for further 
circulation because of its physical condition such as torn, dirty, limp, 
worn or defaced. Unfit currency should not be forwarded to the Treasury, 
but may be exchanged at commercial banks.

[47 FR 32044, July 23, 1982, as amended at 56 FR 10170, Mar. 11, 1991]



Sec. 100.6  Destroyed paper currency.

    No relief will be granted on account of lawfully held paper currency 
of the United States which has been totally destroyed.

[[Page 310]]



Sec. 100.7  Treasury's liability.

    (a) Payment will be made to lawful holders of mutilated currency at 
full value when:
    (1) Clearly more than 50% of a note identifiable as United States 
currency is present; or
    (2) Fifty percent or less of a note identifiable as United States 
currency is present and the method of mutilation and supporting evidence 
demonstrate to the satisfaction of the Treasury that the missing 
portions have been totally destroyed.
    (b) No payments will be made when:
    (1) Fragments and remnants presented are not identifiable as United 
States currency; or
    (2) Fragments and remnants presented which represent 50% or less of 
a note are identifiable as United States currency but the method of 
destruction and supporting evidence do not satisfy the Treasury that the 
missing portion has been totally destroyed.
    (c) All cases will be handled under proper procedures to safeguard 
the funds and interests of the claimant. In some cases, the amount 
repaid will be less than the amount claimed. In other cases, the amount 
repaid may be greater. The amount paid will be determined by an 
examination made by trained mutilated currency examiners and governed by 
the above criteria.
    (d) The Director of the Bureau of Engraving and Printing shall have 
final authority with respect to settlements for mutilated currency 
claims.

[47 FR 32044, July 23, 1982, as amended at 56 FR 10170, Mar. 11, 1991]



Sec. 100.8  Packaging of mutilated currency.

    Mutilated currency examiners are normally able to determine the 
value of mutilated currency when it has been carefully packed and boxed 
as described below:
    (a) Regardless of the condition of the currency, do not disturb the 
fragments more than is absolutely necessary.
    (b) If the currency is brittle or inclined to fall apart, pack it 
carefully in cotton and box it as found, without disturbing the 
fragments, if possible.
    (c) If the money was in a purse, box, or other container when 
mutilated, it should be left therein, if possible, in order to prevent 
further deterioration of the fragments or from their being lost.
    (d) If it is absolutely necessary to remove the fragments from the 
container, send the container with the currency and any other contents 
found, except as noted in paragraph (h) of this section.
    (e) If the money was flat when mutilated, do not roll or fold.
    (f) If the money was in a roll when mutilated, do not attempt to 
unroll or straighten.
    (g) If coin or any other metal is mixed with the currency, remove 
carefully. Do not send coin or other metal in the same package with 
mutilated paper currency, as the metal will break up the currency. Coin 
should be forwarded as provided in Sec. 100.12 (c) and (d).
    (h) Any fused or melted coin should be sent to: Superintendent, 
United States Mint, P.O. Box 400, Philadelphia, PA 19105.



Sec. 100.9  Where mutilated currency should be transmitted.

    Mutilated currency shipments must be addressed as follows: 
Department of the Treasury, Bureau of Engraving and Printing, OCS, Room 
344A, Post Office Box 37048, Washington, DC 20013.

[47 FR 32044, July 23, 1982, as amended at 56 FR 10170, Mar. 11, 1991]



                       Subpart C--Exchange of Coin



Sec. 100.10  Exchange of uncurrent coins.

    (a) Definition. Uncurrent coins are whole U.S. coins which are 
merely worn or reduced in weight by natural abrasion yet are readily and 
clearly recognizable as to genuineness and denomination and which are 
machine countable.
    (b) Redemption basis. Uncurrent coins will be redeemed at face 
value.
    (c) Criteria for acceptance. Uncurrent coins, forwarded for 
redemption at face value, must be shipped at the expense and risk of the 
owner. Shipments of subsidiary or minor coins for redemption at face 
value should be sorted by denomination into packages in sums of 
multiples of $20. Not more than $1,000 in any silver or clad coin, $200 
in 5-cent

[[Page 311]]

pieces, or $50 in 1-cent pieces should be shipped in one bag or package.
    (d) Redemption sites. Uncurrent coins will be redeemed only at the 
Federal Reserve banks and branches listed in Sec. 100.17.



Sec. 100.11  Exchange of bent and partial coins.

    (a) Definitions. (1) Bent coins are U.S. coins which are bent or 
deformed so as to preclude normal machine counting but which are readily 
and clearly identifiable as to genuineness and denomination.
    (2) Partial coins are U.S. coins which are not whole; partial coins 
must be readily and clearly identifiable as to genuineness and 
denomination.
    (b) Redemption basis. Bent and partial coins shall be presented 
separately by denomination category in lots of at least one pound for 
each category. Bent and partial coins shall be redeemed on the basis of 
their weight and denomination category rates (which is the weight 
equivalent of face value). If not presented separately by denomination 
category, bent and partial coins will not be accepted for redemption. 
Denomination categories and rates are Cents, @ $1.4585 per pound; 
Nickels, 
@ $4.5359 per pound; Dimes, Quarters, Halves, and Eisenhower Dollars @ 
$20.00 per pound; and Anthony Dollars @ $56.00 per pound. Copper plated 
zinc cents shall be redeemed at the face value equivalent of copper one 
cent coins.
    (c) Redemption site. Bent and partial coins will be redeemed only at 
the United States Mint, P.O. Box 400, Philadelphia, PA 19105. Coins are 
shipped at sender's risk and expense.

[47 FR 32044, July 23, 1982, as amended at 64 FR 39920, July 23, 1999]



Sec. 100.12  Exchange of fused and mixed coins.

    (a) Definitions. (1) Fused coins are U.S. coins which are melted to 
the extent that they are bonded together and the majority of which are 
readily and clearly identifiable as U.S. coins.
    (2) Mixed coins are U.S. coins of several alloy categories which are 
presented together, but are readily and clearly identifiable as U.S. 
coins.
    (b) The United States Mint will not accept fused or mixed coins for 
redemption.
    (c) Criteria for acceptance. (1) A minimum of two pounds of fused 
and mixed coins is required for redemption.
    (2) Fused and mixed coins containing lead, solder, or other 
substance which will render them unsuitable for coinage metal will not 
be accepted.
    (d) Redemption site. Fused and mixed coins will be redeemed only at 
the United States Mint, P.O. Box 400, Philadelphia, PA 19105. Coins are 
shipped at sender's risk and expense.

[47 FR 32044, July 23, 1982, as amended at 64 FR 39920, July 23, 1999]



Sec. 100.13  Criminal penalties.

    Criminal penalties connected with the defacement or mutilation of 
U.S. coins are provided in the United States Code, Title 18, section 
331.



                      Subpart D--Other Information



Sec. 100.16  Exchange of paper and coin to be handled through Federal Reserve banks and branches.

    Other than as provided in this document all transactions including 
the exchange of paper currency and coin shall be handled through the 
Federal Reserve banks and branches.



Sec. 100.17  Location of Federal Reserve banks and branches.

                    Federal Reserve Bank and Address

Boston--600 Atlantic Avenue, Boston, MA 02106
New York--33 Liberty Street (Federal Reserve P.O. Station), New York, NY 
10045
Buffalo Branch--160 Delaware Avenue (P.O. Box 961), Buffalo, NY 14240
Philadelphia--Ten Independence Mall (P.O. Box 66), Philadelphia, PA 
19105
Cleveland--1455 East Sixth Street (P.O. Box 6387), Cleveland, OH 44101
Cincinnati Branch--150 East Fourth Street (P.O. Box 999), Cincinnati, OH 
45201
Pittsburgh Branch--717 Grant Street (P.O. Box 867), Pittsburgh, PA 15230
Richmond--701 East Byrd Avenue (P.O. Box 27622), Richmond, VA 23261
Baltimore Branch--114-120 East Lexington Street (P.O. Box 1378), 
Baltimore, MD 21203
Charlotte Branch--530 East Trade Street (P.O. Box 30248), Charlotte, NC 
28230
Atlanta--104 Marietta Street, NW., Atlanta, GA 30303

[[Page 312]]

Birmingham Branch--1801 Fifth Avenue, North (P.O. Box 830447), 
Birmingham, AL 35283-0447
Jacksonville Branch--800 Water Street (P.O. Box 929) Jacksonville, FL 
32231-0044
Miami Branch--9100 NW., 36th Street (P.O. Box 520847), Miami, FL 33152
Nashville Branch--301 Eighth Avenue, North, Nashville, TN 37203
New Orleans Branch--525 St. Charles Avenue (P.O. Box 61630), New 
Orleans, LA 70161
Chicago--230 South LaSalle Street (P.O. Box 834), Chicago, IL 60690
Detroit Branch--160 Fort Street, West (P.O. Box 1059), Detroit, MI 48231
St. Louis--411 Locust Street (P.O. Box 442), St. Louis, MO 63166
Little Rock Branch--325 West Capitol Avenue (P.O. Box 1261), Little 
Rock, AR 72203
Louisville Branch--410 South Fifth Street (P.O. Box 32710), Louisville, 
KY 40232
Memphis Branch--200 North Main Street (P.O. Box 407), Memphis, TN 38101
Minneapolis--250 Marquette Avenue, Minneapolis, MN 55480
Helena Branch--400 North Park Avenue, Helena, MT 59601
Kansas City--925 Grand Avenue (Federal Reserve Station), Kansas City, MO 
64198
Denver Branch--1020 16th Street (P.O. Box 5228, Terminal Annex), Denver, 
CO 80217
Oklahoma City Branch--226 Dean A. McGee Street (P.O. Box 25129), 
Oklahoma City, OK 73125
Omaha Branch--2201 Farnam Street (P.O. Box 3958), Omaha, NB 68103
Dallas--400 South Akard Street (Station K), Dallas, TX 75222
El Paso Branch--301 East Main Street (P.O. Box 100), El Paso, TX 79999
Houston Branch--1701 San Jacinto Street (P.O. Box 2578), Houston, TX 
77001
San Antonio Branch--126 East Nueva Street (P.O. Box 1471), San Antonio, 
TX 78295
San Francisco--400 Sansome Street (P.O. Box 7702), San Francisco, CA 
94120
Los Angeles Branch--950 South Grand Avenue (Terminal Annex, P.O. Box 
2077), Los Angeles CA 90051
Portland Branch--915 SW Stark Street (P.O. Box 3436), Portland, OR 97208
Salt Lake City Branch--120 South State Street (P.O. Box 30780), Salt 
Lake City, UT 84125
Seattle Branch--1015 Second Avenue (P.O. Box 3567), Seattle, WA 98124

[47 FR 32044, July 23, 1982, as amended at 56 FR 10170, Mar. 11, 1991]



Sec. 100.18  Counterfeit notes to be marked; ``redemption'' of notes wrongfully so marked.

    The Act of June 30, 1876 (19 Stat. 4; 31 U.S.C. 424), provides that 
all U.S. Officers charged with the receipt or disbursement of public 
moneys, and all officers of national banks, shall stamp or write in 
plain letters the word ``counterfeit,'' ``altered,'' or ``worthless'' 
upon all fraudulent notes issued in the form of, and intended to 
circulate as money, which shall be presented at their places of 
business; and if such officers shall wrongfully stamp any genuine note 
of the United States, or of the national bank, they shall, upon 
presentation, ``redeem'' such notes at the face amount thereof.



Sec. 100.19  Disposition of counterfeit notes and coins.

    All counterfeit notes and coin found in remittances are cancelled 
and delivered to the U.S. Secret Service of the Department of the 
Treasury or to the nearest local office of that Service, a receipt for 
the same being forwarded to the sender. Communications with respect 
thereto should be addressed to the Director, U.S. Secret Service, 
Department of the Treasury, Washington, DC 20223.



PART 101--MITIGATION OF FORFEITURE OF COUNTERFEIT GOLD COINS--Table of Contents




Sec.
101.1  Purpose and scope.
101.2  Petitions for mitigation.
101.3  Petitions reviewed by Assistant Secretary, Enforcement, 
          Operations, Tariff Affairs.
101.4  Extraction of gold bullion from the counterfeit coins.
101.5  Payment of smelting costs.
101.6  Return of the bullion.
101.7  Exceptions.
101.8  Discretion of the Secretary.

    Authority: 18 U.S.C. 492.

    Source: 42 FR 1472, Jan. 7, 1977, unless otherwise noted.



Sec. 101.1  Purpose and scope.

    The purpose of this part is to establish a policy whereby certain 
purchasers or holders of gold coins who have forfeited them to the 
United States because they were counterfeit may, in the discretion of 
the Secretary of the Treasury, recover the gold bullion from the coins. 
This part sets forth the procedures to be followed in implementing this 
policy.

[[Page 313]]



Sec. 101.2  Petitions for mitigation.

    (a) Who may file. Any person may petition the Secretary of the 
Treasury for return of the gold bullion of counterfeit gold coins 
forfeited to the United States, if:
    (1) The petitioner innocently purchased or received the coins and 
held them without the knowledge that they were counterfeit; and,
    (2) The petitioner voluntarily submitted the coins to the Treasury 
Department for a determination of whether they were legitimate or 
counterfeit; and,
    (3) The coins were determined to be counterfeit and were seized by 
the Treasury Department and forfeited to the United States.
    (b) To whom addressed. Petitions for mitigation of the forfeiture of 
counterfeit gold coins should be addressed to the Assistant Secretary, 
Enforcement, Operations, Tariff Affairs, Department of Treasury, 15th 
and Pennsylvania Avenue, NW., Washington, DC 20220.
    (c) Form. The petition need not be in any particular form, but must 
be under oath, and set forth at least the following:
    (1) The full name and address of the petitioner;
    (2) A description of the coin or coins involved;
    (3) The name and address of the person from whom the coins were 
received or purchased by the petitioner;
    (4) The date and place where they were voluntarily submitted for 
examination;
    (5) Any other circumstances relied upon by the petitioner to justify 
the mitigation;
    (6) A statement that the petitioner purchased or received and held 
the coins without the knowledge that they were counterfeit.



Sec. 101.3  Petitions reviewed by Assistant Secretary, Enforcement, Operations, Tariff Affairs.

    (a) The Assistant Secretary will receive and review all petitions 
for mitigation of the forfeiture of counterfeit gold coins. He shall 
conduct such further investigation, and may request such further 
information from the petitioner as he deems necessary. Petitions will be 
approved if the Assistant Secretary determines that:
    (1) The gold coins have not been previously disposed of by normal 
procedures;
    (2) The petitioner was an innocent purchaser or holder of the gold 
coins and is not under investigation in connection with the coins at the 
time of submission or thereafter;
    (3) The coins are not needed and will not be needed in the future in 
any investigation or as evidence in legal proceedings; and
    (4) Mitigation of the forfeiture is in the best interest of the 
Government.



Sec. 101.4  Extraction of gold bullion from the counterfeit coins.

    If the petition is approved, the Assistant Secretary shall then 
forward the gold coins to the Bureau of the Mint where, if economically 
feasible, the gold bullion will be extracted from the counterfeit coins. 
The Bureau of the Mint will then return the bullion to the Assistant 
Secretary.



Sec. 101.5  Payment of smelting costs.

    The petitioner shall be required to pay all reasonable costs 
incurred in extracting the bullion from the counterfeit coins, as shall 
be determined by the Assistant Secretary. Payment must be made prior to 
the return of the gold bullion to the petitioner.



Sec. 101.6  Return of the bullion.

    After receiving the gold bullion from the Bureau of the Mint, the 
Assistant Secretary shall notify the petitioner that his petition has 
been approved and that payment of the smelting costs in an amount set 
forth in such notice must be made prior to the return of the bullion.



Sec. 101.7  Exceptions.

    The provisions of this part shall not apply where the cost of 
smelting the gold coins exceeds the value of the gold bullion to be 
returned.



Sec. 101.8  Discretion of the Secretary.

    The Secretary of the Treasury retains complete discretion to deny 
any claim of any petitioner when the Secretary believes it is not in the 
best interest of the Government to return the

[[Page 314]]

bullion to the petitioner or when the Secretary is not convinced that 
the petitoner was an innocent purchaser or holder without knowledge that 
the gold coins were counterfeit.



PART 103--FINANCIAL RECORDKEEPING AND REPORTING OF CURRENCY AND FOREIGN TRANSACTIONS--Table of Contents




                         Subpart A--Definitions

Sec.
103.11  Meaning of terms.

                 Subpart B--Reports Required To Be Made

103.15  Determination by the Secretary.
103.18  Reports by banks of suspicious transactions.
103.20  Reports by money services businesses of suspicious transactions.
103.22  Reports of transactions in currency.
103.23  Reports of transportation of currency or monetary instruments.
103.24  Reports of foreign financial accounts.
103.25  Reports of transactions with foreign financial agencies.
103.26  Reports of certain domestic coin and currency transactions.
103.27  Filing of reports.
103.28  Identification required.
103.29  Purchases of bank checks and drafts, cashier's checks, money 
          orders and traveler's checks.

              Subpart C--Records Required To Be Maintained

103.31  Determination by the Secretary.
103.32  Records to be made and retained by persons having financial 
          interests in foreign financial accounts.
103.33  Records to be made and retained by financial institutions.
103.34  Additional records to be made and retained by banks.
103.35  Additional records to be made and retained by brokers or dealers 
          in securities.
103.36  Additional records to be made and retained by casinos.
103.37  Additional records to be made and retained by currency dealers 
          or exchangers.
103.38  Nature of records and retention period.
103.39  Person outside the United States.

         Subpart D--Special Rules for Money Services Businesses

103.41  Registration of money services businesses.

                      Subpart E--General Provisions

103.51  Dollars as including foreign currency.
103.52  Photographic or other reproductions of Government obligations.
103.53  Availability of information.
103.54  Disclosure.
103.55  Exceptions, exemptions, and reports.
103.56  Enforcement.
103.57  Civil penalty.
103.58  Forfeiture of currency or monetary instruments.
103.59  Criminal penalty.
103.60  Enforcement authority with respect to transportation of currency 
          or monetary instruments.
103.61  Access to records.
103.62  Rewards for informants.
103.63  Structured transactions.
103.64  Special rules for casinos.

                           Subpart F--Summons

103.71  General.
103.72  Persons who may issue summons.
103.73  Contents of summons.
103.74  Service of summons.
103.75  Examination of witnesses and records.
103.76  Enforcement of summons.
103.77  Payment of expenses.

                    Subpart G--Administrative Rulings

103.80  Scope.
103.81  Submitting requests.
103.82  Nonconforming requests.
103.83  Oral communications.
103.84  Withdrawing requests.
103.85  Issuing rulings.
103.86  Modifying or rescinding rulings.
103.87  Disclosing information.

Appendix to Part 103--Administrative Rulings

    Authority: 12 U.S.C. 1829b and 1951-1959; 31 U.S.C. 5311-5330.

    Source: 37 FR 6912, Apr. 5, 1972, unless otherwise noted.



                         Subpart A--Definitions



Sec. 103.11  Meaning of terms.

    When used in this part and in forms prescribed under this part, 
where not otherwise distinctly expressed or manifestly incompatible with 
the intent thereof, terms shall have the meanings ascribed in this 
section.
    (a) Accept. A receiving financial institution, other than the 
recipient's financial institution, accepts a transmittal order by 
executing the transmittal order. A recipient's financial institution 
accepts a transmittal order

[[Page 315]]

by paying the recipient, by notifying the recipient of the receipt of 
the order or by otherwise becoming obligated to carry out the order.
    (b) At one time. For purposes of Sec. 103.23 of this part, a person 
who transports, mails, ships or receives; is about to or attempts to 
transport, mail or ship; or causes the transportation, mailing, shipment 
or receipt of monetary instruments, is deemed to do so ``at one time'' 
if:
    (1) That person either alone, in conjunction with or on behalf of 
others;
    (2) Transports, mails, ships or receives in any manner; is about to 
transport, mail or ship in any manner; or causes the transportation, 
mailing, shipment or receipt in any manner of;
    (3) Monetary instruments;
    (4) Into the United States or out of the United States;
    (5) Totaling more than $10,000;
    (6)(i) On one calendar day or (ii) if for the purpose of evading the 
reporting requirements of Sec. 103.23, on one or more days.
    (c) Bank. Each agent, agency, branch or office within the United 
States of any person doing business in one or more of the capacities 
listed below:
    (1) A commercial bank or trust company organized under the laws of 
any State or of the United States;
    (2) A private bank;
    (3) A savings and loan association or a building and loan 
association organized under the laws of any State or of the United 
States;
    (4) An insured institution as defined in section 401 of the National 
Housing Act;
    (5) A savings bank, industrial bank or other thrift institution;
    (6) A credit union organized under the law of any State or of the 
United States;
    (7) Any other organization (except a money services business) 
chartered under the banking laws of any state and subject to the 
supervision of the bank supervisory authorities of a State;
    (8) A bank organized under foreign law;
    (9) Any national banking association or corporation acting under the 
provisions of section 25(a) of the Act of Dec. 23, 1913, as added by the 
Act of Dec. 24, 1919, ch. 18, 41 Stat. 378, as amended (12 U.S.C. 611-
32).
    (d) Beneficiary. The person to be paid by the beneficiary's bank.
    (e) Beneficiary's bank. The bank or foreign bank identified in a 
payment order in which an account of the beneficiary is to be credited 
pursuant to the order or which otherwise is to make payment to the 
beneficiary if the order does not provide for payment to an account.
    (f) Broker or dealer in securities. A broker or dealer in 
securities, registered or required to be registered with the Securities 
and Exchange Commission under the Securities Exchange Act of 1934.
    (g) Common carrier. Any person engaged in the business of 
transporting individuals or goods for a fee who holds himself out as 
ready to engage in such transportation for hire and who undertakes to do 
so indiscriminately for all persons who are prepared to pay the fee for 
the particular service offered.
    (h) Currency. The coin and paper money of the United States or of 
any other country that is designated as legal tender and that circulates 
and is customarily used and accepted as a medium of exchange in the 
country of issuance. Currency includes U.S. silver certificates, U.S. 
notes and Federal Reserve notes. Currency also includes official foreign 
bank notes that are customarily used and accepted as a medium of 
exchange in a foreign country.
    (i) [Reserved]
    (j) Deposit account. Deposit accounts include transaction accounts 
described in paragraph (q) of this section, savings accounts, and other 
time deposits.
    (k) Domestic. When used herein, refers to the doing of business 
within the United States, and limits the applicability of the provision 
where it appears to the performance by such institutions or agencies of 
functions within the United States.
    (l) Established customer. A person with an account with the 
financial institution, including a loan account or deposit or other 
asset account, or a person with respect to which the financial 
institution has obtained and maintains on file the person's name and 
address, as well as taxpayer identification number (e.g., social 
security or employer

[[Page 316]]

identification number) or, if none, alien identification number or 
passport number and country of issuance, and to which the financial 
institution provides financial services relying on that information.
    (m) Execution date. The day on which the receiving financial 
institution may properly issue a transmittal order in execution of the 
sender's order. The execution date may be determined by instruction of 
the sender but cannot be earlier than the day the order is received, 
and, unless otherwise determined, is the day the order is received. If 
the sender's instruction states a payment date, the execution date is 
the payment date or an earlier date on which execution is reasonably 
necessary to allow payment to the recipient on the payment date.
    (n) Financial institution. Each agent, agency, branch, or office 
within the United States of any person doing business, whether or not on 
a regular basis or as an organized business concern, in one or more of 
the capacities listed below:
    (1) A bank (except bank credit card systems);
    (2) A broker or dealer in securities;
    (3) A money services business as defined in paragraph (uu) of this 
section;
    (4) A telegraph company;
    (5)(i) Casino. A casino or gambling casino that: Is duly licensed or 
authorized to do business as such in the United States, whether under 
the laws of a State or of a Territory or Insular Possession of the 
United States, or under the Indian Gaming Regulatory Act or other 
federal, state, or tribal law or arrangement affecting Indian lands 
(including, without limitation, a casino operating on the assumption or 
under the view that no such authorization is required for casino 
operation on Indian lands); and has gross annual gaming revenue in 
excess of $1 million. The term includes the principal headquarters and 
every domestic branch or place of business of the casino.
    (ii) For purposes of this paragraph (i)(7), ``gross annual gaming 
revenue'' means the gross gaming revenue received by a casino, during 
either the previous business year or the current business year of the 
casino. A casino or gambling casino which is a casino for purposes of 
this part solely because its gross annual gaming revenue exceeds 
$1,000,000 during its current business year, shall not be considered a 
casino for purposes of this part prior to the time in its current 
business year that its gross annual gaming revenue exceeds $1,000,000.
    (iii) Any reference in this part, other than in this paragraph 
(n)(7) and in paragraph (n)(8) of this section, to a casino shall also 
include a reference to a card club, unless the provision in question 
contains specific language varying its application to card clubs or 
excluding card clubs from its application;
    (6)(i) Card club. A card club, gaming club, card room, gaming room, 
or similar gaming establishment that is duly licensed or authorized to 
do business as such in the United States, whether under the laws of a 
State, of a Territory or Insular Possession of the United States, or of 
a political subdivision of any of the foregoing, or under the Indian 
Gaming Regulatory Act or other federal, state, or tribal law or 
arrangement affecting Indian lands (including, without limitation, an 
establishment operating on the assumption or under the view that no such 
authorization is required for operation on Indian lands for an 
establishment of such type), and that has gross annual gaming revenue in 
excess of $1,000,000. The term includes the principal headquarters and 
every domestic branch or place of business of the establishment. The 
term ``casino,'' as used in this Part shall include a reference to 
``card club'' to the extent provided in paragraph (n)(7)(iii) of this 
section.
    (ii) For purposes of this paragraph (n)(8), gross annual gaming 
revenue means the gross revenue derived from or generated by customer 
gaming activity (whether in the form of per-game or per-table fees, 
however computed, rentals, or otherwise) and received by an 
establishment, during either the establishment's previous business year 
or its current business year. A card club that is a financial 
institution for purposes of this Part solely because its gross annual 
revenue exceeds $1,000,000 during its current business year, shall not 
be considered a financial institution for purposes of this Part prior to 
the time in its current business year

[[Page 317]]

when its gross annual revenue exceeds $1,000,000;
    (7) A person subject to supervision by any state or federal bank 
supervisory authority.
    (o) Foreign bank. A bank organized under foreign law, or an agency, 
branch or office located outside the United States of a bank. The term 
does not include an agent, agency, branch or office within the United 
States of a bank organized under foreign law.
    (p) Foreign financial agency. A person acting outside the United 
States for a person (except for a country, a monetary or financial 
authority acting as a monetary or financial authority, or an 
international financial institution of which the United States 
Government is a member) as a financial institution, bailee, depository 
trustee, or agent, or acting in a similar way related to money, credit, 
securities, gold, or a transaction in money, credit, securities, or 
gold.
    (q) Funds transfer. The series of transactions, beginning with the 
originator's payment order, made for the purpose of making payment to 
the beneficiary of the order. The term includes any payment order issued 
by the originator's bank or an intermediary bank intended to carry out 
the originator's payment order. A funds transfer is completed by 
acceptance by the beneficiary's bank of a payment order for the benefit 
of the beneficiary of the originator's payment order. Funds transfers 
governed by the Electronic Fund Transfer Act of 1978 (Title XX, Pub. L. 
95-630, 92 Stat. 3728, 15 U.S.C. 1693, et seq.), as well as any other 
funds transfers that are made through an automated clearinghouse, an 
automated teller machine, or a point-of-sale system, are excluded from 
this definition.
    (r) Intermediary bank. A receiving bank other than the originator's 
bank or the beneficiary's bank.
    (s) Intermediary financial institution. A receiving financial 
institution, other than the transmittor's financial institution or the 
recipient's financial institution. The term intermediary financial 
institution includes an intermediary bank.
    (t) Investment security. An instrument which:
    (1) Is issued in bearer or registered form;
    (2) Is of a type commonly dealt in upon securities exchanges or 
markets or commonly recognized in any area in which it is issued or 
dealt in as a medium for investment;
    (3) Is either one of a class or series or by its terms is divisible 
into a class or series of instruments; and
    (4) Evidences a share, participation or other interest in property 
or in an enterprise or evidences an obligation of the issuer.
    (u) Monetary instruments. (1) Monetary instruments include:
    (i) Currency;
    (ii) Traveler's checks in any form;
    (iii) All negotiable instruments (including personal checks, 
business checks, official bank checks, cashier's checks, third-party 
checks, promissory notes (as that term is defined in the Uniform 
Commercial Code), and money orders) that are either in bearer form, 
endorsed without restriction, made out to a fictitious payee (for the 
purposes of Sec. 103.23), or otherwise in such form that title thereto 
passes upon delivery;
    (iv) Incomplete instruments (including personal checks, business 
checks, official bank checks, cashier's checks, third-party checks, 
promissory notes (as that term is defined in the Uniform Commercial 
Code), and money orders) signed but with the payee's name omitted; and
    (v) Securities or stock in bearer form or otherwise in such form 
that title thereto passes upon delivery.
    (2) Monetary instruments do not include warehouse receipts or bills 
of lading.
    (v) Originator. The sender of the first payment order in a funds 
transfer.
    (w) Originator's bank. The receiving bank to which the payment order 
of the originator is issued if the originator is not a bank or foreign 
bank, or the originator if the originator is a bank or foreign bank.
    (x) Payment date. The day on which the amount of the transmittal 
order is payable to the recipient by the recipient's financial 
institution. The payment date may be determined by instruction of the 
sender, but cannot be

[[Page 318]]

earlier than the day the order is received by the recipient's financial 
institution and, unless otherwise prescribed by instruction, is the date 
the order is received by the recipient's financial institution.
    (y) Payment order. An instruction of a sender to a receiving bank, 
transmitted orally, electronically, or in writing, to pay, or to cause 
another bank or foreign bank to pay, a fixed or determinable amount of 
money to a beneficiary if:
    (1) The instruction does not state a condition to payment to the 
beneficiary other than time of payment;
    (2) The receiving bank is to be reimbursed by debiting an account 
of, or otherwise receiving payment from, the sender; and
    (3) The instruction is transmitted by the sender directly to the 
receiving bank or to an agent, funds transfer system, or communication 
system for transmittal to the receiving bank.
    (z) Person. An individual, a corporation, a partnership, a trust or 
estate, a joint stock company, an association, a syndicate, joint 
venture, or other unincorporated organization or group, an Indian Tribe 
(as that term is defined in the Indian Gaming Regulatory Act), and all 
entities cognizable as legal personalities.
    (aa) Receiving bank. The bank or foreign bank to which the sender's 
instruction is addressed.
    (bb) Receiving financial institution. The financial institution or 
foreign financial agency to which the sender's instruction is addressed. 
The term receiving financial institution includes a receiving bank.
    (cc) Recipient. The person to be paid by the recipient's financial 
institution. The term recipient includes a beneficiary, except where the 
recipient's financial institution is a financial institution other than 
a bank.
    (dd) Recipient's financial institution. The financial institution or 
foreign financial agency identified in a transmittal order in which an 
account of the recipient is to be credited pursuant to the transmittal 
order or which otherwise is to make payment to the recipient if the 
order does not provide for payment to an account. The term recipient's 
financial institution includes a beneficiary's bank, except where the 
beneficiary is a recipient's financial institution.
    (ee) Secretary. The Secretary of the Treasury or any person duly 
authorized by the Secretary to perform the function mentioned.
    (ff) Sender. The person giving the instruction to the receiving 
financial institution.
    (gg) Structure (structuring). For purposes of section 103.53, a 
person structures a transaction if that person, acting alone, or in 
conjunction with, or on behalf of, other persons, conducts or attempts 
to conduct one or more transactions in currency, in any amount, at one 
or more financial institutions, on one or more days, in any manner, for 
the purpose of evading the reporting requirements under section 103.22 
of this part. ``In any manner'' includes, but is not limited to, the 
breaking down of a single sum of currency exceeding $10,000 into smaller 
sums, including sums at or below $10,000, or the conduct of a 
transaction, or series of currency transactions, including transactions 
at or below $10,000. The transaction or transactions need not exceed the 
$10,000 reporting threshold at any single financial institution on any 
single day in order to constitute structuring within the meaning of this 
definition.
    (hh) Transaction account. Transaction accounts include those 
accounts described in 12 U.S.C. 461(b)(1)(C), money market accounts and 
similar accounts that take deposits and are subject to withdrawal by 
check or other negotiable order.
    (ii) Transaction. (1) Except as provided in paragraph (ii)(2) of 
this section, transaction means a purchase, sale, loan, pledge, gift, 
transfer, delivery, or other disposition, and with respect to a 
financial institution includes a deposit, withdrawal, transfer between 
accounts, exchange of currency, loan, extension of credit, purchase or 
sale of any stock, bond, certificate of deposit, or other monetary 
instrument or investment security, purchase or redemption of any money 
order, payment or order for any money remittance or

[[Page 319]]

transfer, or any other payment, transfer, or delivery by, through, or to 
a financial institution, by whatever means effected.
    (2) For purposes of Sec. 103.22, and other provisions of this part 
relating solely to the report required by that section, the term 
``transaction in currency'' shall mean a transaction involving the 
physical transfer of currency from one person to another. A transaction 
which is a transfer of funds by means of bank check, bank draft, wire 
transfer, or other written order, and which does not include the 
physical transfer of currency, is not a transaction in currency for this 
purpose.
    (jj) Transmittal of funds. A series of transactions beginning with 
the transmittor's transmittal order, made for the purpose of making 
payment to the recipient of the order. The term includes any transmittal 
order issued by the transmittor's financial institution or an 
intermediary financial institution intended to carry out the 
transmittor's transmittal order. The term transmittal of funds includes 
a funds transfer. A transmittal of funds is completed by acceptance by 
the recipient's financial institution of a transmittal order for the 
benefit of the recipient of the transmittor's transmittal order. Funds 
transfers governed by the Electronic Fund Transfer Act of 1978 (Title 
XX, Pub. L. 95-630, 92 Stat. 3728, 15 U.S.C. 1693, et seq.), as well as 
any other funds transfers that are made through an automated 
clearinghouse, an automated teller machine, or a point-of-sale system, 
are excluded from this definition.
    (kk) Transmittal order. The term transmittal order includes a 
payment order and is an instruction of a sender to a receiving financial 
institution, transmitted orally, electronically, or in writing, to pay, 
or cause another financial institution or foreign financial agency to 
pay, a fixed or determinable amount of money to a recipient if:
    (1) The instruction does not state a condition to payment to the 
recipient other than time of payment;
    (2) The receiving financial institution is to be reimbursed by 
debiting an account of, or otherwise receiving payment from, the sender; 
and
    (3) The instruction is transmitted by the sender directly to the 
receiving financial institution or to an agent or communication system 
for transmittal to the receiving financial institution.
    (ll) Transmittor. The sender of the first transmittal order in a 
transmittal of funds. The term transmittor includes an originator, 
except where the transmittor's financial institution is a financial 
institution or foreign financial agency other than a bank or foreign 
bank.
    (mm) Transmittor's financial institution. The receiving financial 
institution to which the transmittal order of the transmittor is issued 
if the transmittor is not a financial institution or foreign financial 
agency, or the transmittor if the transmittor is a financial institution 
or foreign financial agency. The term transmittor's financial 
institution includes an originator's bank, except where the originator 
is a transmittor's financial institution other than a bank or foreign 
bank.
    (nn) United States. The States of the United States, the District of 
Columbia, the Indian lands (as that term is defined in the Indian Gaming 
Regulatory Act), and the Territories and Insular Possessions of the 
United States.
    (oo) Business day. Business day, as used in this part with respect 
to banks, means that day, as normally communicated to its depository 
customers, on which a bank routinely posts a particular transaction to 
its customer's account.
    (pp) Postal Service. The United States Postal Service.
    (qq) FinCEN. FinCEN means the Financial Crimes Enforcement Network, 
an office within the Office of the Under Secretary (Enforcement) of the 
Department of the Treasury.
    (rr) Indian Gaming Regulatory Act. The Indian Gaming Regulatory Act 
of 1988, codified at 25 U.S.C. 2701-2721 and 18 U.S.C. 1166-68.
    (ss) State. The States of the United States and, wherever necessary 
to carry out the provisions of this part, the District of Columbia.
    (tt) Territories and Insular Possessions. The Commonwealth of Puerto 
Rico, the United States Virgin Islands, Guam, the Commonwealth of the 
Northern

[[Page 320]]

Mariana Islands, and all other territories and possessions of the United 
States other than the Indian lands and the District of Columbia.
    (uu) Money services business. Each agent, agency, branch, or office 
within the United States of any person doing business, whether or not on 
a regular basis or as an organized business concern, in one or more of 
the capacities listed in paragraphs (uu)(1) through (uu)(6) of this 
section. Notwithstanding the preceding sentence, the term ``money 
services business'' shall not include a bank, nor shall it include a 
person registered with, and regulated or examined by, the Securities and 
Exchange Commission or the Commodity Futures Trading Commission.
    (1) Currency dealer or exchanger. A currency dealer or exchanger 
(other than a person who does not exchange currency in an amount greater 
than $1,000 in currency or monetary or other instruments for any person 
on any day in one or more transactions).
    (2) Check casher. A person engaged in the business of a check casher 
(other than a person who does not cash checks in an amount greater than 
$1,000 in currency or monetary or other instruments for any person on 
any day in one or more transactions).
    (3) Issuer of traveler's checks, money orders, or stored value. An 
issuer of traveler's checks, money orders, or, stored value (other than 
a person who does not issue such checks or money orders or stored value 
in an amount greater than $1,000 in currency or monetary or other 
instruments to any person on any day in one or more transactions).
    (4) Seller or redeemer of traveler's checks, money orders, or stored 
value. A seller or redeemer of traveler's checks, money orders, or 
stored value (other than a person who does not sell such checks or money 
orders or stored value in an amount greater than $1,000 in currency or 
monetary or other instruments to or redeem such instruments for an 
amount greater than $1,000 in currency or monetary or other instruments 
from, any person on any day in one or more transactions).
    (5) Money transmitter--(i) In general. Money transmitter:
    (A) Any person, whether or not licensed or required to be licensed, 
who engages as a business in accepting currency, or funds denominated in 
currency, and transmits the currency or funds, or the value of the 
currency or funds, by any means through a financial agency or 
institution, a Federal Reserve Bank or other facility of one or more 
Federal Reserve Banks, the Board of Governors of the Federal Reserve 
System, or both, or an electronic funds transfer network; or
    (B) Any other person engaged as a business in the transfer of funds.
    (ii) Facts and circumstances; Limitation. Whether a person ``engages 
as a business'' in the activities described in paragraph (uu)(5)(i) of 
this section is a matter of facts and circumstances. Generally, the 
acceptance and transmission of funds as an integral part of the 
execution and settlement of a transaction other than the funds 
transmission itself (for example, in connection with a bona fide sale of 
securities or other property), will not cause a person to be a money 
transmitter within the meaning of paragraph (uu)(5)(i) of this section.
    (6) United States Postal Service. The United States Postal Service, 
except with respect to the sale of postage or philatelic products.
    (vv) Stored value. Funds or monetary value represented in digital 
electronics format (whether or not specially encrypted) and stored or 
capable of storage on electronic media in such a way as to be 
retrievable and transferable electronically.

[52 FR 11441, Apr. 8, 1987; 52 FR 12641, Apr. 17, 1987, as amended at 53 
FR 777, Jan. 13, 1988; 53 FR 4138, Feb. 12, l988; 54 FR 3027, Jan. 23, 
1989; 54 FR 28418, July 6, 1989; 55 FR 20143, May 15, 1990; 58 FR 13546, 
Mar. 12, 1993; 60 FR 228, Jan. 3, 1995; 61 FR 4331, Feb. 5, 1996; 61 FR 
7055, Feb. 23, 1996; 61 FR 14249, 14385, Apr. 1, 1996; 63 FR 1923, Jan. 
13, 1998; 64 FR 45450, Aug. 20, 1999; 65 FR 13692, Mar. 14, 2000]



                 Subpart B--Reports Required To Be Made



Sec. 103.15  Determination by the Secretary.

    The Secretary hereby determines that the reports required by this 
subpart have a high degree of usefulness in

[[Page 321]]

criminal, tax, or regulatory investigations or proceedings.

[37 FR 6912, Apr. 5, 1972. Redesignated at 61 FR 4331, Feb. 5, 1996 and 
further redesignated at 65 FR 13692, Mar. 14, 2000]



Sec. 103.18  Reports by banks of suspicious transactions.

    (a) General. (1) Every bank shall file with the Treasury Department, 
to the extent and in the manner required by this section, a report of 
any suspicious transaction relevant to a possible violation of law or 
regulation. A bank may also file with the Treasury Department by using 
the Suspicious Activity Report specified in paragraph (b)(1) of this 
section or otherwise, a report of any suspicious transaction that it 
believes is relevant to the possible violation of any law or regulation 
but whose reporting is not required by this section.
    (2) A transaction requires reporting under the terms of this section 
if it is conducted or attempted by, at, or through the bank, it involves 
or aggregates at least $5,000 in funds or other assets, and the bank 
knows, suspects, or has reason to suspect that:
    (i) The transaction involves funds derived from illegal activities 
or is intended or conducted in order to hide or disguise funds or assets 
derived from illegal activities (including, without limitation, the 
ownership, nature, source, location, or control of such funds or assets) 
as part of a plan to violate or evade any federal law or regulation or 
to avoid any transaction reporting requirement under federal law or 
regulation;
    (ii) The transaction is designed to evade any requirements of this 
part or of any other regulations promulgated under the Bank Secrecy Act, 
Pub. L. 91-508, as amended, codified at 12 U.S.C. 1829b, 12 U.S.C. 1951-
1959, and 31 U.S.C. 5311-5330; or
    (iii) The transaction has no business or apparent lawful purpose or 
is not the sort in which the particular customer would normally be 
expected to engage, and the bank knows of no reasonable explanation for 
the transaction after examining the available facts, including the 
background and possible purpose of the transaction.
    (b) Filing procedures--(1) What to file. A suspicious transaction 
shall be reported by completing a Suspicious Activity Report (``SAR''), 
and collecting and maintaining supporting documentation as required by 
paragraph (d) of this section.
    (2) Where to file. The SAR shall be filed with FinCEN in a central 
location, to be determined by FinCEN, as indicated in the instructions 
to the SAR.
    (3) When to file. A bank is required to file a SAR no later than 30 
calendar days after the date of initial detection by the bank of facts 
that may constitute a basis for filing a SAR. If no suspect was 
identified on the date of the detection of the incident requiring the 
filing, a bank may delay filing a SAR for an additional 30 calendar days 
to identify a suspect. In no case shall reporting be delayed more than 
60 calendar days after the date of initial detection of a reportable 
transaction. In situations involving violations that require immediate 
attention, such as, for example, ongoing money laundering schemes, the 
bank shall immediately notify, by telephone, an appropriate law 
enforcement authority in addition to filing timely a SAR.
    (c) Exceptions. A bank is not required to file a SAR for a robbery 
or burglary committed or attempted that is reported to appropriate law 
enforcement authorities, or for lost, missing, counterfeit, or stolen 
securities with respect to which the bank files a report pursuant to the 
reporting requirements of 17 CFR 240.17f-1.
    (d) Retention of records. A bank shall maintain a copy of any SAR 
filed and the original or business record equivalent of any supporting 
documentation for a period of five years from the date of filing the 
SAR. Supporting documentation shall be identified, and maintained by the 
bank as such, and shall be deemed to have been filed with the SAR. A 
bank shall make all supporting documentation available to FinCEN and any 
appropriate law enforcement agencies or bank supervisory agencies upon 
request.
    (e) Confidentiality of reports; limitation of liability. No bank or 
other financial institution, and no director, officer, employee, or 
agent of any bank or

[[Page 322]]

other financial institution, who reports a suspicious transaction under 
this part, may notify any person involved in the transaction that the 
transaction has been reported. Thus, any person subpoenaed or otherwise 
requested to disclose a SAR or the information contained in a SAR, 
except where such disclosure is requested by FinCEN or an appropriate 
law enforcement or bank supervisory agency, shall decline to produce the 
SAR or to provide any information that would disclose that a SAR has 
been prepared or filed, citing this paragraph (e) and 31 U.S.C. 
5318(g)(2), and shall notify FinCEN of any such request and its response 
thereto. A bank, and any director, officer, employee, or agent of such 
bank, that makes a report pursuant to this section (whether such report 
is required by this section or is made voluntarily) shall be protected 
from liability for any disclosure contained in, or for failure to 
disclose the fact of such report, or both, to the full extent provided 
by 31 U.S.C. 5318(g)(3).
    (f) Compliance. Compliance with this section shall be audited by the 
Department of the Treasury, through FinCEN or its delegees under the 
terms of the Bank Secrecy Act. Failure to satisfy the requirements of 
this section may be a violation of the reporting rules of the Bank 
Secrecy Act and of this part. Such failure may also violate provisions 
of Title 12 of the Code of Federal Regulations.

[61 FR 4331, Feb. 5, 1996, as amended at 61 FR 14249, Apr. 1, 1996; 61 
FR 18250, Apr. 25, 1996. Redesignated at 65 FR 13692, Mar. 14, 2000]



Sec. 103.20  Reports by money services businesses of suspicious transactions.

    (a) General. (1) Every money services business, described in 
Sec. 103.11(uu) (3), (4), (5), or (6), shall file with the Treasury 
Department, to the extent and in the manner required by this section, a 
report of any suspicious transaction relevant to a possible violation of 
law or regulation. Any money services business may also file with the 
Treasury Department, by using the form specified in paragraph (b)(1) of 
this section, or otherwise, a report of any suspicious transaction that 
it believes is relevant to the possible violation of any law or 
regulation but whose reporting is not required by this section.
    (2) A transaction requires reporting under the terms of this section 
if it is conducted or attempted by, at, or through a money services 
business, involves or aggregates funds or other assets of at least 
$2,000 (except as provided in paragraph (a)(3) of this section), and the 
money services business knows, suspects, or has reason to suspect that 
the transaction (or a pattern of transactions of which the transaction 
is a part):
    (i) Involves funds derived from illegal activity or is intended or 
conducted in order to hide or disguise funds or assets derived from 
illegal activity (including, without limitation, the ownership, nature, 
source, location, or control of such funds or assets) as part of a plan 
to violate or evade any federal law or regulation or to avoid any 
transaction reporting requirement under federal law or regulation;
    (ii) Is designed, whether through structuring or other means, to 
evade any requirements of this part or of any other regulations 
promulgated under the Bank Secrecy Act, Public Law 91-508, as amended, 
codified at 12 U.S.C. 1829b, 12 U.S.C. 1951-1959, and 31 U.S.C. 5311-
5330; or
    (iii) Serves no business or apparent lawful purpose, and the 
reporting money services business knows of no reasonable explanation for 
the transaction after examining the available facts, including the 
background and possible purpose of the transaction.
    (3) To the extent that the identification of transactions required 
to be reported is derived from a review of clearance records or other 
similar records of money orders or traveler's checks that have been sold 
or processed, an issuer of money orders or traveler's checks shall only 
be required to report a transaction or pattern of transactions that 
involves or aggregates funds or other assets of at least $5,000.
    (4) The obligation to identify and properly and timely to report a 
suspicious transaction rests with each money services business involved 
in the transaction, provided that no more than one report is required to 
be filed

[[Page 323]]

by the money services businesses involved in a particular transaction 
(so long as the report filed contains all relevant facts). Whether, in 
addition to any liability on its own for failure to report, a money 
services business that issues the instrument or provides the funds 
transfer service involved in the transaction may be liable for the 
failure of another money services business involved in the transaction 
to report that transaction depends upon the nature of the contractual or 
other relationship between the businesses, and the legal effect of the 
facts and circumstances of the relationship and transaction involved, 
under general principles of the law of agency.
    (5) Notwithstanding the provisions of this section, a transaction 
that involves solely the issuance, or facilitation of the transfer of 
stored value, or the issuance, sale, or redemption of stored value, 
shall not be subject to reporting under this paragraph (a), until the 
promulgation of rules specifically relating to such reporting.
    (b) Filing procedures--(1) What to file. A suspicious transaction 
shall be reported by completing a Suspicious Activity Report-MSB (``SAR-
MSB''), and collecting and maintaining supporting documentation as 
required by paragraph (c) of this section.
    (2) Where to file. The SAR-MSB shall be filed in a central location 
to be determined by FinCEN, as indicated in the instructions to the SAR-
MSB.
    (3) When to file. A money services business subject to this section 
is required to file each SAR-MSB no later than 30 calendar days after 
the date of the initial detection by the money services business of 
facts that may constitute a basis for filing a SAR-MSB under this 
section. In situations involving violations that require immediate 
attention, such as ongoing money laundering schemes, the money services 
business shall immediately notify by telephone an appropriate law 
enforcement authority in addition to filing a SAR-MSB.
    (c) Retention of records. A money services business shall maintain a 
copy of any SAR-MSB filed and the original or business record equivalent 
of any supporting documentation for a period of five years from the date 
of filing the SAR-MSB. Supporting documentation shall be identified as 
such and maintained by the money services business, and shall be deemed 
to have been filed with the SAR-MSB. A money services business shall 
make all supporting documentation available to FinCEN and any other 
appropriate law enforcement agencies or supervisory agencies upon 
request.
    (d) Confidentiality of reports; limitation of liability. No 
financial institution, and no director, officer, employee, or agent of 
any financial institution, who reports a suspicious transaction under 
this part, may notify any person involved in the transaction that the 
transaction has been reported. Thus, any person subpoenaed or otherwise 
requested to disclose a SAR-MSB or the information contained in a SAR-
MSB, except where such disclosure is requested by FinCEN or an 
appropriate law enforcement or supervisory agency, shall decline to 
produce the SAR-MSB or to provide any information that would disclose 
that a SAR-MSB has been prepared or filed, citing this paragraph (d) and 
31 U.S.C. 5318(g)(2), and shall notify FinCEN of any such request and 
its response thereto. A reporting money services business, and any 
director, officer, employee, or agent of such reporting money services 
business, that makes a report pursuant to this section (whether such 
report is required by this section or made voluntarily) shall be 
protected from liability for any disclosure contained in, or for failure 
to disclose the fact of, such report, or both, to the extent provided by 
31 U.S.C. 5318(g)(3).
    (e) Compliance. Compliance with this section shall be audited by the 
Department of the Treasury, through FinCEN or its delegees under the 
terms of the Bank Secrecy Act. Failure to satisfy the requirements of 
this section may constitute a violation of the reporting rules of the 
Bank Secrecy Act and of this part.
    (f) Effective date. This section applies to transactions occurring 
after December 31, 2001.

[65 FR 13692, Mar. 14, 2000]

[[Page 324]]



Sec. 103.22  Reports of transactions in currency.

    (a) General. This section sets forth the rules for the reporting by 
financial institutions of transactions in currency. The reporting 
obligations themselves are stated in paragraph (b) of this section. The 
reporting rules relating to aggregation are stated in paragraph (c) of 
this section. Rules permitting banks to exempt certain transactions from 
the reporting obligations appear in paragraph (d) of this section.
    (b) Filing obligations--(1) Financial institutions other than 
casinos. Each financial institution other than a casino shall file a 
report of each deposit, withdrawal, exchange of currency or other 
payment or transfer, by, through, or to such financial institution which 
involves a transaction in currency of more than $10,000, except as 
otherwise provided in this section. In the case of the Postal Service, 
the obligation contained in the preceding sentence shall not apply to 
payments or transfers made solely in connection with the purchase of 
postage or philatelic products.
    (2) Casinos. Each casino shall file a report of each transaction in 
currency, involving either cash in or cash out, of more than $10,000.
    (i) Transactions in currency involving cash in include, but are not 
limited to:
    (A) Purchases of chips, tokens, and plaques;
    (B) Front money deposits;
    (C) Safekeeping deposits;
    (D) Payments on any form of credit, including markers and counter 
checks;
    (E) Bets of currency;
    (F) Currency received by a casino for transmittal of funds through 
wire transfer for a customer;
    (G) Purchases of a casino's check; and
    (H) Exchanges of currency for currency, including foreign currency.
    (ii) Transactions in currency involving cash out include, but are 
not limited to:
    (A) Redemptions of chips, tokens, and plaques;
    (B) Front money withdrawals;
    (C) Safekeeping withdrawals;
    (D) Advances on any form of credit, including markers and counter 
checks;
    (E) Payments on bets, including slot jackpots;
    (F) Payments by a casino to a customer based on receipt of funds 
through wire transfer for credit to a customer;
    (G) Cashing of checks or other negotiable instruments;
    (H) Exchanges of currency for currency, including foreign currency; 
and
    (I) Reimbursements for customers' travel and entertainment expenses 
by the casino.
    (c) Aggregation--(1) Multiple branches. A financial institution 
includes all of its domestic branch offices, and any recordkeeping 
facility, wherever located, that contains records relating to the 
transactions of the institution's domestic offices, for purposes of this 
section's reporting requirements.
    (2) Multiple transactions--general. In the case of financial 
institutions other than casinos, for purposes of this section, multiple 
currency transactions shall be treated as a single transaction if the 
financial institution has knowledge that they are by or on behalf of any 
person and result in either cash in or cash out totaling more than 
$10,000 during any one business day (or in the case of the Postal 
Service, any one day). Deposits made at night or over a weekend or 
holiday shall be treated as if received on the next business day 
following the deposit.
    (3) Multiple transactions--casinos. In the case of a casino, 
multiple currency transactions shall be treated as a single transaction 
if the casino has knowledge that they are by or on behalf of any person 
and result in either cash in or cash out totaling more than $10,000 
during any gaming day. For purposes of this paragraph (c)(3), a casino 
shall be deemed to have the knowledge described in the preceding 
sentence, if: any sole proprietor, partner, officer, director, or 
employee of the casino, acting within the scope of his or her 
employment, has knowledge that such multiple currency transactions have 
occurred, including knowledge from examining the books, records, logs, 
information retained on magnetic disk, tape or other machine-readable 
media, or in any manual system, and similar documents and information, 
which the casino maintains pursuant to any law or

[[Page 325]]

regulation or within the ordinary course of its business, and which 
contain information that such multiple currency transactions have 
occurred.
    (d) Transactions of exempt persons--(1) General. No bank is required 
to file a report otherwise required by paragraph (b) of this section 
with respect to any transaction in currency between an exempt person and 
such bank, or, to the extent provided in paragraph (d)(6)(vi) of this 
section, between such exempt person and other banks affiliated with such 
bank. In addition, a non-bank financial institution is not required to 
file a report otherwise required by paragraph (b) of this section with 
respect to a transaction in currency between the institution and a 
commercial bank. (A limitation on the exemption described in this 
paragraph (d)(1) is set forth in paragraph (d)(7) of this section.)
    (2) Exempt person. For purposes of this section, an exempt person 
is:
    (i) A bank, to the extent of such bank's domestic operations;
    (ii) A department or agency of the United States, of any State, or 
of any political subdivision of any State;
    (iii) Any entity established under the laws of the United States, of 
any State, or of any political subdivision of any State, or under an 
interstate compact between two or more States, that exercises 
governmental authority on behalf of the United States or any such State 
or political subdivision;
    (iv) Any entity, other than a bank, whose common stock or analogous 
equity interests are listed on the New York Stock Exchange or the 
American Stock Exchange or whose common stock or analogous equity 
interests have been designated as a Nasdaq National Market Security 
listed on the Nasdaq Stock Market (except stock or interests listed 
under the separate ``Nasdaq Small-Cap Issues'' heading), provided that, 
for purposes of this paragraph (d)(2)(iv), a person that is a financial 
institution, other than a bank, is an exempt person only to the extent 
of its domestic operations;
    (v) Any subsidiary, other than a bank, of any entity described in 
paragraph (d)(2)(iv) of this section (a ``listed entity'') that is 
organized under the laws of the United States or of any State and at 
least 51 percent of whose common stock or analogous equity interest is 
owned by the listed entity, provided that, for purposes of this 
paragraph (d)(2)(v), a person that is a financial institution, other 
than a bank, is an exempt person only to the extent of its domestic 
operations;
    (vi) To the extent of its domestic operations, any other commercial 
enterprise (for purposes of this paragraph (d), a ``non-listed 
business''), other than an enterprise specified in paragraph 
(d)(6)(viii) of this section, that:
    (A) Has maintained a transaction account at the bank for at least 12 
months;
    (B) Frequently engages in transactions in currency with the bank in 
excess of $10,000; and
    (C) Is incorporated or organized under the laws of the United States 
or a State, or is registered as and eligible to do business within the 
United States or a State; or
    (vii) With respect solely to withdrawals for payroll purposes from 
existing transaction accounts, any other person (for purposes of this 
paragraph (d), a ``payroll customer'') that:
    (A) Has maintained a transaction account at the bank for at least 12 
months;
    (B) Operates a firm that regularly withdraws more than $10,000 in 
order to pay its United States employees in currency; and
    (C) Is incorporated or organized under the laws of the United States 
or a State, or is registered as and eligible to do business within the 
United States or a State.
    (3) Initial designation of exempt persons--(i) General. A bank must 
designate each exempt person with which it engages in transactions in 
currency by the close of the 30-day period beginning after the day of 
the first reportable transaction in currency with that person sought to 
be exempted from reporting under the terms of this paragraph (d). Except 
where the person sought to be exempted is another bank as described in 
paragraph (d)(2)(i) of this section, designation by a bank of an exempt 
person shall be made by a single filing of Internal Revenue Service Form 
4789, in which line 36 is

[[Page 326]]

marked ``Designation of Exempt Person'' and items 2-14 (Part I, Section 
A) and items 37-49 (Part III) are completed, or by filing any form 
specifically designated by FinCEN for this purpose. The designation must 
be made separately by each bank that treats the person in question as an 
exempt person, except as provided in paragraph (d)(6)(vi) of this 
section. The designation requirements of this paragraph (d)(3) apply 
whether or not the particular exempt person to be designated has 
previously been treated as exempt from the reporting requirements of 
prior Sec. 103.22(a) under the rules contained in 31 CFR 103.22(a) 
through (g), as in effect on October 20, 1998 (see 31 CFR Parts 0 to 199 
revised as of July 1, 1998). A special transitional rule, which extends 
the time for initial designation for customers that have been previously 
treated as exempt under such prior rules, is contained in paragraph 
(d)(11) of this section.
    (ii) Special rules for banks. When designating another bank as an 
exempt person, a bank must either make the filing required by paragraph 
(d)(3)(i) of this section or file, in such a format and manner as FinCEN 
may specify, a current list of its domestic bank customers. In the event 
that a bank files its current list of domestic bank customers, the bank 
must make the filing as described in paragraph (d)(3)(i) of this section 
for each bank that is a new customer and for which an exemption is 
sought under this paragraph (d).
    (4) Annual review. The information supporting each designation of an 
exempt person, and the application to each account of an exempt person 
described in paragraphs (d)(2)(vi) or (d)(2)(vii) of this section of the 
monitoring system required to be maintained by paragraph (d)(9)(ii) of 
this section, must be reviewed and verified at least once each year.
    (5) Biennial filing with respect to certain exempt persons--(i) 
General. A biennial filing, as described in paragraph (d)(5)(ii) of this 
section, is required for continuation of the treatment as an exempt 
person of a customer described in paragraph (d)(2)(vi) or (vii) of this 
section. No biennial filing is required for continuation of the 
treatment as an exempt person of a customer described in paragraphs 
(d)(2)(i) through (v) of this section.
    (ii) Non-listed businesses and payroll customers. The designation of 
a non-listed business or a payroll customer as an exempt person must be 
renewed biennially, beginning on March 15 of the second calendar year 
following the year in which the first designation of such customer as an 
exempt person is made, and every other March 15 thereafter, on such form 
as FinCEN shall specify. Biennial renewals must include a statement 
certifying that the bank's system of monitoring the transactions in 
currency of an exempt person for suspicious activity, required to be 
maintained by paragraph (d)(9)(ii) of this section, has been applied as 
necessary, but at least annually, to the account of the exempt person to 
whom the biennial renewal applies. Biennial renewals also must include 
information about any change in control of the exempt person involved of 
which the bank knows (or should know on the basis of its records).
    (6) Operating rules--(i) General rule. Subject to the specific rules 
of this paragraph (d), a bank must take such steps to assure itself that 
a person is an exempt person (within the meaning of the applicable 
provision of paragraph (d)(2) of this section), to document the basis 
for its conclusions, and document its compliance, with the terms of this 
paragraph (d), that a reasonable and prudent bank would take and 
document to protect itself from loan or other fraud or loss based on 
misidentification of a person's status, and in the case of the 
monitoring system requirement set forth in paragraph (d)(9)(ii) of this 
section, such steps that a reasonable and prudent bank would take and 
document to identify suspicious transactions as required by paragraph 
(d)(9)(ii) of this section.
    (ii) Governmental departments and agencies. A bank may treat a 
person as a governmental department, agency, or entity if the name of 
such person reasonably indicates that it is described in paragraph 
(d)(2)(ii) or (d)(2)(iii) of this section, or if such person is known 
generally in the community to be a State, the District of Columbia, a 
tribal government, a Territory or Insular Possession of the United 
States, or a political

[[Page 327]]

subdivision or a wholly-owned agency or instrumentality of any of the 
foregoing. An entity generally exercises governmental authority on 
behalf of the United States, a State, or a political subdivision, for 
purposes of paragraph (d)(2)(iii) of this section, only if its 
authorities include one or more of the powers to tax, to exercise the 
authority of eminent domain, or to exercise police powers with respect 
to matters within its jurisdiction. Examples of entities that exercise 
governmental authority include, but are not limited to, the New Jersey 
Turnpike Authority and the Port Authority of New York and New Jersey.
    (iii) Stock exchange listings. In determining whether a person is 
described in paragraph (d)(2)(iv) of this section, a bank may rely on 
any New York, American or Nasdaq Stock Market listing published in a 
newspaper of general circulation, on any commonly accepted or published 
stock symbol guide, on any information contained in the Securities and 
Exchange Commission ``Edgar'' System, or on any information contained on 
an Internet World-Wide Web site or sites maintained by the New York 
Stock Exchange, the American Stock Exchange, or the National Association 
of Securities Dealers.
    (iv) Listed company subsidiaries. In determining whether a person is 
described in paragraph (d)(2)(v) of this section, a bank may rely upon:
    (A) Any reasonably authenticated corporate officer's certificate;
    (B) Any reasonably authenticated photocopy of Internal Revenue 
Service Form 851 (Affiliation Schedule) or the equivalent thereof for 
the appropriate tax year; or
    (C) A person's Annual Report or Form 10-K, as filed in each case 
with the Securities and Exchange Commission.
    (v) Aggregated accounts. In determining the qualification of a 
customer as an exempt person, a bank may treat all transaction accounts 
of the customer as a single account. If a bank elects to treat all 
transaction accounts of a customer as a single account, the bank must 
continue to treat such accounts consistently as a single account for 
purposes of determining the qualification of the customer as an exempt 
person.
    (vi) Affiliated banks. The designation required by paragraph (d)(3) 
of this section may be made by a parent bank holding company or one of 
its bank subsidiaries on behalf of all bank subsidiaries of the holding 
company, so long as the designation lists each bank subsidiary to which 
the designation shall apply.
    (vii) Sole proprietorships. A sole proprietorship may be treated as 
a non-listed business if it otherwise meets the requirements of 
paragraph (d)(2)(vi) of this section, as applicable. In addition, a sole 
proprietorship may be treated as a payroll customer if it otherwise 
meets the requirements of paragraph (d)(2)(vii) of this section, as 
applicable.
    (viii) Ineligible businesses. A business engaged primarily in one or 
more of the following activities may not be treated as a non-listed 
business for purposes of this paragraph (d): serving as financial 
institutions or agents of financial institutions of any type; purchase 
or sale to customers of motor vehicles of any kind, vessels, aircraft, 
farm equipment or mobile homes; the practice of law, accountancy, or 
medicine; auctioning of goods; chartering or operation of ships, buses, 
or aircraft; gaming of any kind (other than licensed parimutuel betting 
at race tracks); investment advisory services or investment banking 
services; real estate brokerage; pawn brokerage; title insurance and 
real estate closing; trade union activities; and any other activities 
that may be specified by FinCEN. A business that engages in multiple 
business activities may be treated as a non-listed business so long as 
no more than 50% of its gross revenues is derived from one or more of 
the ineligible business activities listed in this paragraph 
(d)(6)(viii).
    (ix) Transaction account. A transaction account, for purposes of 
paragraph (d) of this section, is any account described in section 
19(b)(1)(C) of the Federal Reserve Act, 12 U.S.C. 461(b)(1)(C). For 
purposes of paragraphs (d)(2)(vi) and (d)(2)(vii) of this section, a 
person is an exempt person only to the extent of such person's eligible 
transaction accounts.

[[Page 328]]

    (x) Documentation. The records maintained by a bank to document its 
compliance with and administration of the rules of this paragraph (d) 
shall be maintained in accordance with the provisions of Sec. 103.38.
    (7) Limitation on exemption. A transaction carried out by an exempt 
person as an agent for another person who is the beneficial owner of the 
funds that are the subject of a transaction in currency is not subject 
to the exemption from reporting contained in paragraph (d)(1) of this 
section.
    (8) Limitation on liability. (i) No bank shall be subject to penalty 
under this part for failure to file a report required by paragraph (b) 
of this section with respect to a transaction in currency by an exempt 
person with respect to which the requirements of this paragraph (d) have 
been satisfied, unless the bank:
    (A) Knowingly files false or incomplete information with respect to 
the transaction or the customer engaging in the transaction; or
    (B) Has reason to believe that the customer does not meet the 
criteria established by this paragraph (d) for treatment of the 
transactor as an exempt person or that the transaction is not a 
transaction of the exempt person.
    (ii) Subject to the specific terms of this paragraph (d), and absent 
any specific knowledge of information indicating that a customer no 
longer meets the requirements of an exempt person, a bank satisfies the 
requirements of this paragraph (d) to the extent it continues to treat 
that customer as an exempt person until the date of that customer's next 
periodic review, which, as required by paragraph (d)(4) of this section, 
shall occur no less than once each year.
    (iii) A bank that files a report with respect to a currency 
transaction by an exempt person rather than treating such person as 
exempt shall remain subject, with respect to each such report, to the 
rules for filing reports, and the penalties for filing false or 
incomplete reports that are applicable to reporting of transactions in 
currency by persons other than exempt persons.
    (9) Obligations to file suspicious activity reports and maintain 
system for monitoring transactions in currency. (i) Nothing in this 
paragraph (d) relieves a bank of the obligation, or reduces in any way 
such bank's obligation, to file a report required by Sec. 103.21 with 
respect to any transaction, including any transaction in currency that a 
bank knows, suspects, or has reason to suspect is a transaction or 
attempted transaction that is described in Sec. 103.21(a)(2)(i), (ii), 
or (iii), or relieves a bank of any reporting or recordkeeping 
obligation imposed by this part (except the obligation to report 
transactions in currency pursuant to this section to the extent provided 
in this paragraph (d)). Thus, for example, a sharp increase from one 
year to the next in the gross total of currency transactions made by an 
exempt customer, or similarly anomalous transaction trends or patterns, 
may trigger the obligations of a bank under Sec. 103.21.
    (ii) Consistent with its annual review obligations under paragraph 
(d)(4)of this section, a bank shall establish and maintain a monitoring 
system that is reasonably designed to detect, for each account of a non-
listed business or payroll customer, those transactions in currency 
involving such account that would require a bank to file a suspicious 
transaction report. The statement in the preceding sentence with respect 
to accounts of non-listed and payroll customers does not limit the 
obligation of banks generally to take the steps necessary to satisfy the 
terms of paragraph (d)(9)(i) of this section and Sec. 103.21 with 
respect to all exempt persons.
    (10) Revocation. The status of any person as an exempt person under 
this paragraph (d) may be revoked by FinCEN by written notice, which may 
be provided by publication in the Federal Register in appropriate 
situations, on such terms as are specified in such notice. Without any 
action on the part of the Treasury Department and subject to the 
limitation on liability contained in paragraph (d)(8)(ii) of this 
section:
    (i) The status of an entity as an exempt person under paragraph 
(d)(2)(iv) of this section ceases once such entity ceases to be listed 
on the applicable stock exchange; and
    (ii) The status of a subsidiary as an exempt person under paragraph

[[Page 329]]

(d)(2)(v) of this section ceases once such subsidiary ceases to have at 
least 51 per cent of its common stock or analogous equity interest owned 
by a listed entity.
    (11) Transitional rule. (i) No accounts may be newly granted an 
exemption or placed on an exempt list on or after October 21, 1998, 
under the rules contained in 31 CFR 103.22(b) through (g), as in effect 
on October 20, 1998 (see 31 CFR Parts 0 to 199 revised as of July 1, 
1998).
    (ii) If a bank properly treated an account (a ``previously exempted 
account'') as exempt on October 20, 1998 under the rules contained in 31 
CFR 103.22(b) through (g), as in effect on October 20, 1998 (see 31 CFR 
Parts 0 to 199 revised as of July 1, 1998), it may continue to treat 
such account as exempt under such prior rules with respect to 
transactions in currency occurring on or before June 30, 2000, provided 
that it does so consistently until the earlier of June 30, 2000, and the 
date on which the bank makes the designation or the determination 
described in paragraph (d)(11)(iii) of this section. A bank that 
continues to treat a previously exempted account as exempt under the 
prior rules, and for the period, specified in the preceding sentence, 
shall remain subject to such prior rules, and to the penalties for 
failing to comply therewith, with respect to transactions in currency 
occurring during such period.
    (iii) A bank must, on or before July 1, 2000, either designate the 
holder of a previously exempted account as an exempt person under 
paragraph (d)(2) of this section or determine that it may not or will 
not treat such holder as an exempt person under paragraph (d)(2) of this 
section (so that it will be required to make reports under paragraph (a) 
of this section with respect to transactions in currency by such person 
occurring on or after the date of determination, but no later than July 
1, 2000). A bank that initially does not designate the holder of a 
previously exempted account as an exempt person for periods beginning 
after June 30, 2000, may later make such a designation, to the extent 
otherwise permitted to do so by this paragraph (d), for periods after 
the effective date of such designation.

(Approved by the Office of Management and Budget under control number 
1506-0009)

[63 FR 50156, Sept. 21, 1998]



Sec. 103.23  Reports of transportation of currency or monetary instruments.

    (a) Each person who physically transports, mails, or ships, or 
causes to be physically transported, mailed, or shipped, or attempts to 
physically transport, mail or ship, or attempts to cause to be 
physically transported, mailed or shipped, currency or other monetary 
instruments in an aggregate amount exceeding $10,000 at one time from 
the United States to any place outside the United States, or into the 
United States from any place outside the United States, shall make a 
report thereof. A person is deemed to have caused such transportation, 
mailing or shipping when he aids, abets, counsels, commands, procures, 
or requests it to be done by a financial institution or any other 
person.
    (b) Each person who receives in the U.S. currency or other monetary 
instruments in an aggregate amount exceeding $10,000 at one time which 
have been transported, mailed, or shipped to such person from any place 
outside the United States with respect to which a report has not been 
filed under paragraph (a) of this section, whether or not required to be 
filed thereunder, shall make a report thereof, stating the amount, the 
date of receipt, the form of monetary instruments, and the person from 
whom received.
    (c) This section shall not require reports by:
    (1) A Federal Reserve;
    (2) A bank, a foreign bank, or a broker or dealer in securities, in 
respect to currency or other monetary instruments mailed or shipped 
through the postal service or by common carrier;
    (3) A commercial bank or trust company organized under the laws of 
any State or of the United States with respect to overland shipments of 
currency or monetary instruments shipped to or received from an 
established customer maintaining a deposit relationship with the bank, 
in amounts which the bank may reasonably conclude do

[[Page 330]]

not exceed amounts commensurate with the customary conduct of the 
business, industry or profession of the customer concerned;
    (4) A person who is not a citizen or resident of the United States 
in respect to currency or other monetary instruments mailed or shipped 
from abroad to a bank or broker or dealer in securities through the 
postal service or by common carrier;
    (5) A common carrier of passengers in respect to currency or other 
monetary instruments in the possession of its passengers;
    (6) A common carrier of goods in respect to shipments of currency or 
monetary instruments not declared to be such by the shipper;
    (7) A travelers' check issuer or its agent in respect to the 
transportation of travelers' checks prior to their delivery to selling 
agents for eventual sale to the public;
    (8) By a person with respect to a restrictively endorsed traveler's 
check that is in the collection and reconciliation process after the 
traveler's check has been negotiated,
    (9) Nor by a person engaged as a business in the transportation of 
currency, monetary instruments and other commercial papers with respect 
to the transportation of currency or other monetary instruments overland 
between established offices of banks or brokers or dealers in securities 
and foreign persons.
    (d) A transfer of funds through normal banking procedures which does 
not involve the physical transportation of currency or monetary 
instruments is not required to be reported by this section. This section 
does not require that more than one report be filed covering a 
particular transportation, mailing or shipping of currency or other 
monetary instruments with respect to which a complete and truthful 
report has been filed by a person. However, no person required by 
paragraph (a) or (b) of this section to file a report shall be excused 
from liability for failure to do so if, in fact, a complete and truthful 
report has not been filed.

(Approved by the Office of Management and Budget under control number 
1505-0063)

[37 FR 26517, Dec. 13, 1972, as amended at 50 FR 18479, May 1, 1985; 50 
FR 42693, Oct. 22, 1985; 53 FR 4138, Feb. 12, 1988; 54 FR 28418, July 6, 
1989]



Sec. 103.24  Reports of foreign financial accounts.

    (a) Each person subject to the jurisdiction of the United States 
(except a foreign subsidiary of a U.S. person) having a financial 
interest in, or signature or other authority over, a bank, securities or 
other financial account in a foreign country shall report such 
relationship to the Commissioner of the Internal Revenue for each year 
in which such relationship exists, and shall provide such information as 
shall be specified in a reporting form prescribed by the Secretary to be 
filed by such persons. Persons having a financial interest in 25 or more 
foreign financial accounts need only note that fact on the form. Such 
persons will be required to provide detailed information concerning each 
account when so requested by the Secretary or his delegate.

[42 FR 63774, Dec. 20, 1977, as amended at 52 FR 11443, Apr. 8, 1987; 52 
FR 12641, Apr. 17, 1987]



Sec. 103.25  Reports of transactions with foreign financial agencies.

    (a) Promulgation of reporting requirements. The Secretary, when he 
deems appropriate, may promulgate regulations requiring specified 
financial institutions to file reports of certain transactions with 
designated foreign financial agencies. If any such regulation is issued 
as a final rule without notice and opportunity for public comment, then 
a finding of good cause for dispensing with notice and comment in 
accordance with 5 U.S.C. 553(b) will be included in the regulation. If 
any such regulation is not published in the Federal Register, then any 
financial institution subject to the regulation will

[[Page 331]]

be named and personally served or otherwise given actual notice in 
accordance with 5 U.S.C. 553(b). If a financial institution is given 
notice of a reporting requirement under this section by means other than 
publication in the Federal Register, the Secretary may prohibit 
disclosure of the existence or provisions of that reporting requirement 
to the designated foreign financial agency or agencies and to any other 
party.
    (b) Information subject to reporting requirements. A regulation 
promulgated pursuant to paragraph (a) of this section shall designate 
one or more of the following categories of information to be reported:
    (1) Checks or drafts, including traveler's checks, received by 
respondent financial institution for collection or credit to the account 
of a foreign financial agency, sent by respondent financial institution 
to a foreign country for collection or payment, drawn by respondent 
financial institution on a foreign financial agency, drawn by a foreign 
financial agency on respondent financial institution--including the 
following information.
    (i) Name of maker or drawer;
    (ii) Name of drawee or drawee financial institution;
    (iii) Name of payee;
    (iv) Date and amount of instrument;
    (v) Names of all endorsers.
    (2) Transmittal orders received by a respondent financial 
institution from a foreign financial agency or sent by respondent 
financial institution to a foreign financial agency, including all 
information maintained by that institution pursuant to Sec. 103.33.
    (3) Loans made by respondent financial institution to or through a 
foreign financial agency--including the following information:
    (i) Name of borrower;
    (ii) Name of person acting for borrower;
    (iii) Date and amount of loan;
    (iv) Terms of repayment;
    (v) Name of guarantor;
    (vi) Rate of interest;
    (vii) Method of disbursing proceeds;
    (viii) Collateral for loan.
    (4) Commercial paper received or shipped by the respondent financial 
institution--including the following information:
    (i) Name of maker;
    (ii) Date and amount of paper;
    (iii) Due date;
    (iv) Certificate number;
    (v) Amount of transaction.
    (5) Stocks received or shipped by respondent financial institution--
including the following information:
    (i) Name of corporation;
    (ii) Type of stock;
    (iii) Certificate number;
    (iv) Number of shares;
    (v) Date of certificate;
    (vi) Name of registered holder;
    (vii) Amount of transaction.
    (6) Bonds received or shipped by respondent financial institution--
including the following information:
    (i) Name of issuer;
    (ii) Bond number;
    (iii) Type of bond series;
    (iv) Date issued;
    (v) Due date;
    (vi) Rate of interest;
    (vii) Amount of transaction;
    (viii) Name of registered holder.
    (7) Certificates of deposit received or shipped by respondent 
financial institution--including the following information:
    (i) Name and address of issuer;
    (ii) Date issued;
    (iii) Dollar amount;
    (iv) Name of registered holder;
    (v) Due date;
    (vi) Rate of interest;
    (vii) Certificate number;
    (viii) Name and address of issuing agent.
    (c) Scope of reports. In issuing regulations as provided in 
paragraph (a) of this section, the Secretary will prescribe:
    (1) A reasonable classification of financial institutions subject to 
or exempt from a reporting requirement;
    (2) A foreign country to which a reporting requirement applies if 
the Secretary decides that applying the requirement to all foreign 
countries is unnecessary or undesirable;
    (3) The magnitude of transactions subject to a reporting 
requirement; and
    (4) The kind of transaction subject to or exempt from a reporting 
requirement.

[[Page 332]]

    (d) Form of reports. Regulations issued pursuant to paragraph (a) of 
this section may prescribe the manner in which the information is to be 
reported. However, the Secretary may authorize a designated financial 
institution to report in a different manner if the institution 
demonstrates to the Secretary that the form of the required report is 
unnecessarily burdensome on the institution as prescribed; that a report 
in a different form will provide all the information the Secretary deems 
necessary; and that submission of the information in a different manner 
will not unduly hinder the effective administration of this part.
    (e) Limitations. (1) In issuing regulations under paragraph (a) of 
this section, the Secretary shall consider the need to avoid impeding or 
controlling the export or import of monetary instruments and the need to 
avoid burdening unreasonably a person making a transaction with a 
foreign financial agency.
    (2) The Secretary shall not issue a regulation under paragraph (a) 
of this section for the purpose of obtaining individually identifiable 
account information concerning a customer, as defined by the Right to 
Financial Privacy Act (12 U.S.C. 3401 et seq.), where that customer is 
already the subject of an ongoing investigation for possible violation 
of the Currency and Foreign Transactions Reporting Act, or is known by 
the Secretary to be the subject of an investigation for possible 
violation of any other Federal law.
    (3) The Secretary may issue a regulation pursuant to paragraph (a) 
of this section requiring a financial institution to report transactions 
completed prior to the date it received notice of the reporting 
requirement. However, with respect to completed transactions, a 
financial institution may be required to provide information only from 
records required to be maintained pursuant to Subpart C of this part, or 
any other provision of state or Federal law, or otherwise maintained in 
the regular course of business.

(Approved by the Office of Management and Budget under control number 
1505-0063)

[50 FR 27824, July 8, 1985, as amended at 53 FR 10073, Mar. 29, 1988; 60 
FR 229, Jan. 3, 1995]



Sec. 103.26  Reports of certain domestic coin and currency transactions.

    (a) If the Secretary of the Treasury finds, upon the Secretary's own 
initiative or at the request of an appropriate Federal or State law 
enforcement official, that reasonable grounds exist for concluding that 
additional recordkeeping and/or reporting requirements are necessary to 
carry out the purposes of this part and to prevent persons from evading 
the reporting/recordkeeping requirements of this part, the Secretary may 
issue an order requiring any domestic financial institution or group of 
domestic financial institutions in a geographic area and any other 
person participating in the type of transaction to file a report in the 
manner and to the extent specified in such order. The order shall 
contain such information as the Secretary may describe concerning any 
transaction in which such financial institution is involved for the 
payment, receipt, or transfer of United States coins or currency (or 
such other monetary instruments as the Secretary may describe in such 
order) the total amounts or denominations of which are equal to or 
greater than an amount which the Secretary may prescribe.
    (b) An order issued under paragraph (a) of this section shall be 
directed to the Chief Executive Officer of the financial institution and 
shall designate one or more of the following categories of information 
to be reported: Each deposit, withdrawal, exchange of currency or other 
payment or transfer, by, through or to such financial institution 
specified in the order, which involves all or any class of transactions 
in currency and/or monetary instruments equal to or exceeding an amount 
to be specified in the order.
    (c) In issuing an order under paragraph (a) of this section, the 
Secretary will prescribe:
    (1) The dollar amount of transactions subject to the reporting 
requirement in the order;
    (2) The type of transaction or transactions subject to or exempt 
from a reporting requirement in the order;
    (3) The appropriate form for reporting the transactions required in 
the order;

[[Page 333]]

    (4) The address to which reports required in the order are to be 
sent or from which they will be picked up;
    (5) The starting and ending dates by which such transactions 
specified in the order are to be reported;
    (6) The name of a Treasury official to be contacted for any 
additional information or questions;
    (7) The amount of time the reports and records of reports generated 
in response to the order will have to be retained by the financial 
institution; and
    (8) Any other information deemed necessary to carry out the purposes 
of the order.
    (d)(1) No order issued pursuant to paragraph (a) of this section 
shall prescribe a reporting period of more than 60 days unless renewed 
pursuant to the requirements of paragraph (a).
    (2) Any revisions to an order issued under this section will not be 
effective until made in writing by the Secretary.
    (3) Unless otherwise specified in the order, a bank receiving an 
order under this section may continue to use the exemptions granted 
under Sec. 103.22 of this part prior to the receipt of the order, but 
may not grant additional exemptions.
    (4) For purposes of this section, the term geographic area means any 
area in one or more States of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, the United States Virgin 
Islands, Guam, the Commonwealth of the Northern Mariana Islands, 
American Samoa, the Trust Territory of the Pacific Islands, the 
territories and possessions of the United States, and/or political 
subdivision or subdivisions thereof, as specified in an order issued 
pursuant to paragraph (a) of this section.

(Approved by the Office of Management and Budget under control number 
1505-0063)

[54 FR 33679, Aug. 16, 1989]



Sec. 103.27  Filing of reports.

    (a)(1) A report required by Sec. 103.22(a) shall be filed by the 
financial institution within 15 days following the day on which the 
reportable transaction occurred.
    (2) A report required by Sec. 103.22(g) shall be filed by the bank 
within 15 days after receiving a request for the report.
    (3) A copy of each report filed pursuant to Sec. 103.22 shall be 
retained by the financial institution for a period of five years from 
the date of the report.
    (4) All reports required to be filed by Sec. 103.22 shall be filed 
with the Commissioner of Internal Revenue, unless otherwise specified.
    (b)(1) A report required by Sec. 103.23(a) shall be filed at the 
time of entry into the United States or at the time of departure, 
mailing or shipping from the United States, unless otherwise specified 
by the Commissioner of Customs.
    (2) A report required by Sec. 103.23(b) shall be filed within 15 
days after receipt of the currency or other monetary instruments.
    (3) All reports required by Sec. 103.23 shall be filed with the 
Customs officer in charge at any port of entry or departure, or as 
otherwise specified by the Commissioner of Customs. Reports required by 
Sec. 103.23(a) for currency or other monetary instruments not physically 
accompanying a person entering or departing from the United States, may 
be filed by mail on or before the date of entry, departure, mailing or 
shipping. All reports required by Sec. 103.23(b) may also be filed by 
mail. Reports filed by mail shall be addressed to the Commissioner of 
Customs, Attention: Currency Transportation Reports, Washington, DC 
20229.
    (c) Reports required to be filed by Sec. 103.24 shall be filed with 
the Commissioner of Internal Revenue on or before June 30 of each 
calendar year with respect to foreign financial accounts exceeding 
$10,000 maintained during the previous calendar year.
    (d) Reports required by Sec. 103.22, Sec. 103.23 or Sec. 103.24 
shall be filed on forms prescribed by the Secretary. All information 
called for in such forms shall be furnished.
    (e) Forms to be used in making the reports required by Secs. 103.22 
and 103.24 may be obtained from the Internal Revenue Service. Forms to 
be used in making the reports required by Sec. 103.23 may be obtained 
from the U.S. Customs Service.

(Approved by the Office of Management and Budget under control number 
1505-0063)

[52 FR 11443, Apr. 8, 1987; 52 FR 12641, Apr. 17, 1987, as amended at 53 
FR 4138, Feb. 12, 1988. Redesignated at 54 FR 33678, Aug. 16, 1989]

[[Page 334]]



Sec. 103.28  Identification required.

    Before concluding any transaction with respect to which a report is 
required under Sec. 103.22, a financial institution shall verify and 
record the name and address of the individual presenting a transaction, 
as well as record the identity, account number, and the social security 
or taxpayer identification number, if any, of any person or entity on 
whose behalf such transaction is to be effected. Verification of the 
identity of an individual who indicates that he or she is an alien or is 
not a resident of the United States must be made by passport, alien 
identification card, or other official document evidencing nationality 
or residence (e.g., a Provincial driver's license with indication of 
home address). Verification of identity in any other case shall be made 
by examination of a document, other than a bank signature card, that is 
normally acceptable within the banking community as a means of 
identification when cashing checks for nondepositors (e.g., a drivers 
license or credit card). A bank signature card may be relied upon only 
if it was issued after documents establishing the identity of the 
individual were examined and notation of the specific information was 
made on the signature card. In each instance, the specific identifying 
information (i.e., the account number of the credit card, the driver's 
license number, etc.) used in verifying the identity of the customer 
shall be recorded on the report, and the mere notation of ``known 
customer'' or ``bank signature card on file'' on the report is 
prohibited.

(Approved by the Office of Management and Budget under control number 
1505-0063)

[52 FR 11443, Apr. 8, 1987; 52 FR 12641, Apr. 17, 1987, as amended at 54 
FR 3027, Jan. 23, 1989. Redesignated at 54 FR 33678, Aug. 16, 1989; 59 
FR 61662, Dec. 1, 1994]



Sec. 103.29  Purchases of bank checks and drafts, cashier's checks, money orders and traveler's checks.

    (a) No financial institution may issue or sell a bank check or 
draft, cashier's check, money order or traveler's check for $3,000 or 
more in currency unless it maintains records of the following 
information, which must be obtained for each issuance or sale of one or 
more of these instruments to any individual purchaser which involves 
currency in amounts of $3,000-$10,000 inclusive:
    (1) If the purchaser has a deposit account with the financial 
institution:
    (i)(A) The name of the purchaser;
    (B) The date of purchase;
    (C) The type(s) of instrument(s) purchased;
    (D) The serial number(s) of each of the instrument(s) purchased; and
    (E) The amount in dollars of each of the instrument(s) purchased.
    (ii) In addition, the financial institution must verify that the 
individual is a deposit accountholder or must verify the individual's 
identity. Verification may be either through a signature card or other 
file or record at the financial institution provided the deposit 
accountholder's name and address were verified previously and that 
information was recorded on the signature card or other file or record; 
or by examination of a document which is normally acceptable within the 
banking community as a means of identification when cashing checks for 
nondepositors and which contains the name and address of the purchaser. 
If the deposit accountholder's identity has not been verified 
previously, the financial institution shall verify the deposit 
accountholder's identity by examination of a document which is normally 
acceptable within the banking community as a means of identification 
when cashing checks for nondepositors and which contains the name and 
address of the purchaser, and shall record the specific identifying 
information (e.g., State of issuance and number of driver's license).
    (2) If the purchaser does not have a deposit account with the 
financial institution:
    (i)(A) The name and address of the purchaser;
    (B) The social security number of the purchaser, or if the purchaser 
is an alien and does not have a social security number, the alien 
identification number;
    (C) The date of birth of the purchaser;
    (D) The date of purchase;
    (E) The type(s) of instrument(s) purchased;

[[Page 335]]

    (F) The serial number(s) of the instrument(s) purchased; and
    (G) The amount in dollars of each of the instrument(s) purchased.
    (ii) In addition, the financial institution shall verify the 
purchaser's name and address by examination of a document which is 
normally acceptable within the banking community as a means of 
identification when cashing checks for nondepositors and which contains 
the name and address of the purchaser, and shall record the specific 
identifying information (e.g., State of issuance and number of driver's 
license).
    (b) Contemporaneous purchases of the same or different types of 
instruments totaling $3,000 or more shall be treated as one purchase. 
Multiple purchases during one business day totaling $3,000 or more shall 
be treated as one purchase if an individual employee, director, officer, 
or partner of the financial institution has knowledge that these 
purchases have occurred.
    (c) Records required to be kept shall be retained by the financial 
institution for a period of five years and shall be made available to 
the Secretary upon request at any time.

[59 FR 52252, Oct. 17, 1994]



              Subpart C--Records Required To Be Maintained



Sec. 103.31  Determination by the Secretary.

    The Secretary hereby determines that the records required to be kept 
by this subpart have a high degree of usefulness in criminal, tax, or 
regulatory investigations or proceedings.



Sec. 103.32  Records to be made and retained by persons having financial interests in foreign financial accounts.

    Records of accounts required by Sec. 103.24 to be reported to the 
Commissioner of Internal Revenue shall be retained by each person having 
a financial interest in or signature or other authority over any such 
account. Such records shall contain the name in which each such account 
is maintained, the number or other designation of such account, the name 
and address of the foreign bank or other person with whom such account 
is maintained, the type of such account, and the maximum value of each 
such account during the reporting period. Such records shall be retained 
for a period of 5 years and shall be kept at all times available for 
inspection as authorized by law. In the computation of the period of 5 
years, there shall be disregarded any period beginning with a date on 
which the taxpayer is indicted or information instituted on account of 
the filing of a false or fraudulent Federal income tax return or failing 
to file a Federal income tax return, and ending with the date on which 
final disposition is made of the criminal proceeding.

[37 FR 6912, Apr. 5, 1972, as amended at 52 FR 11444, Apr. 8, 1987]



Sec. 103.33  Records to be made and retained by financial institutions.

    Each financial institution shall retain either the original or a 
microfilm or other copy or reproduction of each of the following:
    (a) A record of each extension of credit in an amount in excess of 
$10,000, except an extension of credit secured by an interest in real 
property, which record shall contain the name and address of the person 
to whom the extension of credit is made, the amount thereof, the nature 
or purpose thereof, and the date thereof;
    (b) A record of each advice, request, or instruction received or 
given regarding any transaction resulting (or intended to result and 
later canceled if such a record is normally made) in the transfer of 
currency or other monetary instruments, funds, checks, investment 
securities, or credit, of more than $10,000 to or from any person, 
account, or place outside the United States.
    (c) A record of each advice, request, or instruction given to 
another financial institution or other person located within or without 
the United States, regarding a transaction intended to result in the 
transfer of funds, or of currency, other monetary instruments, checks, 
investment securities, or credit, of more than $10,000 to a person, 
account or place outside the United States.
    (d) A record of such information for such period of time as the 
Secretary

[[Page 336]]

may require in an order issued under Sec. 103.26(a), not to exceed five 
years.
    (e) Banks. Each agent, agency, branch, or office located within the 
United States of a bank is subject to the requirements of this paragraph 
(e) with respect to a funds transfer in the amount of $3,000 or more:
    (1) Recordkeeping requirements. (i) For each payment order that it 
accepts as an originator's bank, a bank shall obtain and retain either 
the original or a microfilm, other copy, or electronic record of the 
following information relating to the payment order:
    (A) The name and address of the originator;
    (B) The amount of the payment order;
    (C) The execution date of the payment order;
    (D) Any payment instructions received from the originator with the 
payment order;
    (E) The identity of the beneficiary's bank; and
    (F) As many of the following items as are received with the payment 
order: 1
---------------------------------------------------------------------------

    \1\ For funds transfers effected through the Federal Reserve's 
Fedwire funds transfer system, only one of the items is required to be 
retained, if received with the payment order, until such time as the 
bank that sends the order to the Federal Reserve Bank completes its 
conversion to the expanded Fedwire message format.
---------------------------------------------------------------------------

    (1) The name and address of the beneficiary;
    (2) The account number of the beneficiary; and
    (3) Any other specific identifier of the beneficiary.
    (ii) For each payment order that it accepts as an intermediary bank, 
a bank shall retain either the original or a microfilm, other copy, or 
electronic record of the payment order.
    (iii) For each payment order that it accepts as a beneficiary's 
bank, a bank shall retain either the original or a microfilm, other 
copy, or electronic record of the payment order.
    (2) Originators other than established customers. In the case of a 
payment order from an originator that is not an established customer, in 
addition to obtaining and retaining the information required in 
paragraph (e)(1)(i) of this section:
    (i) If the payment order is made in person, prior to acceptance the 
originator's bank shall verify the identity of the person placing the 
payment order. If it accepts the payment order, the originator's bank 
shall obtain and retain a record of the name and address, the type of 
identification reviewed, the number of the identification document 
(e.g., driver's license), as well as a record of the person's taxpayer 
identification number (e.g., social security or employer identification 
number) or, if none, alien identification number or passport number and 
country of issuance, or a notation in the record of the lack thereof. If 
the originator's bank has knowledge that the person placing the payment 
order is not the originator, the originator's bank shall obtain and 
retain a record of the originator's taxpayer identification number 
(e.g., social security or employer identification number) or, if none, 
alien identification number or passport number and country of issuance, 
if known by the person placing the order, or a notation in the record of 
the lack thereof.
    (ii) If the payment order accepted by the originator's bank is not 
made in person, the originator's bank shall obtain and retain a record 
of name and address of the person placing the payment order, as well as 
the person's taxpayer identification number (e.g., social security or 
employer identification number) or, if none, alien identification number 
or passport number and country of issuance, or a notation in the record 
of the lack thereof, and a copy or record of the method of payment 
(e.g., check or credit card transaction) for the funds transfer. If the 
originator's bank has knowledge that the person placing the payment 
order is not the originator, the originator's bank shall obtain and 
retain a record of the originator's taxpayer identification number 
(e.g., social security or employer identification number) or, if none, 
alien identification number or passport number and country of issuance, 
if known by the person placing the order, or a notation in the record of 
the lack thereof.
    (3) Beneficiaries other than established customers. For each payment 
order that it accepts as a beneficiary's bank for a

[[Page 337]]

beneficiary that is not an established customer, in addition to 
obtaining and retaining the information required in paragraph 
(e)(1)(iii) of this section:
    (i) if the proceeds are delivered in person to the beneficiary or 
its representative or agent, the beneficiary's bank shall verify the 
identity of the person receiving the proceeds and shall obtain and 
retain a record of the name and address, the type of identification 
reviewed, and the number of the identification document (e.g., driver's 
license), as well as a record of the person's taxpayer identification 
number (e.g., social security or employer identification number) or, if 
none, alien identification number or passport number and country of 
issuance, or a notation in the record of the lack thereof. If the 
beneficiary's bank has knowledge that the person receiving the proceeds 
is not the beneficiary, the beneficiary's bank shall obtain and retain a 
record of the beneficiary's name and address, as well as the 
beneficiary's taxpayer identification number (e.g., social security or 
employer identification number) or, if none, alien identification number 
or passport number and country of issuance, if known by the person 
receiving the proceeds, or a notation in the record of the lack thereof.
    (ii) if the proceeds are delivered other than in person, the 
beneficiary's bank shall retain a copy of the check or other instrument 
used to effect payment, or the information contained thereon, as well as 
the name and address of the person to which it was sent.
    (4) Retrievability. The information that an originator's bank must 
retain under paragraphs (e)(1)(i) and (e)(2) of this section shall be 
retrievable by the originator's bank by reference to the name of the 
originator. If the originator is an established customer of the 
originator's bank and has an account used for funds transfers, then the 
information also shall be retrievable by account number. The information 
that a beneficiary's bank must retain under paragraphs (e)(1)(iii) and 
(e)(3) of this section shall be retrievable by the beneficiary's bank by 
reference to the name of the beneficiary. If the beneficiary is an 
established customer of the beneficiary's bank and has an account used 
for funds transfers, then the information also shall be retrievable by 
account number. This information need not be retained in any particular 
manner, so long as the bank is able to retrieve the information required 
by this paragraph, either by accessing funds transfer records directly 
or through reference to some other record maintained by the bank.
    (5) Verification. Where verification is required under paragraphs 
(e)(2) and (e)(3) of this section, a bank shall verify a person's 
identity by examination of a document (other than a bank signature 
card), preferably one that contains the person's name, address, and 
photograph, that is normally acceptable by financial institutions as a 
means of identification when cashing checks for persons other than 
established customers. Verification of the identity of an individual who 
indicates that he or she is an alien or is not a resident of the United 
States may be made by passport, alien identification card, or other 
official document evidencing nationality or residence (e.g., a foreign 
driver's license with indication of home address).
    (6) Exceptions. The following funds transfers are not subject to the 
requirements of this section:
    (i) Funds transfers where the originator and beneficiary are any of 
the following:
    (A) A bank;
    (B) A wholly-owned domestic subsidiary of a bank chartered in the 
United States;
    (C) A broker or dealer in securities;
    (D) A wholly-owned domestic subsidiary of a broker or dealer in 
securities;
    (E) The United States;
    (F) A state or local government; or
    (G) A federal, state or local government agency or instrumentality; 
and
    (ii) Funds transfers where both the originator and the beneficiary 
are the same person and the originator's bank and the beneficiary's bank 
are the same bank.
    (f) Nonbank financial institutions. Each agent, agency, branch, or 
office located within the United States of a financial institution other 
than a bank is subject to the requirements of this

[[Page 338]]

paragraph (f) with respect to a transmittal of funds in the amount of 
$3,000 or more:
    (1) Recordkeeping requirements. (i) For each transmittal order that 
it accepts as a transmittor's financial institution, a financial 
institution shall obtain and retain either the original or a microfilm, 
other copy, or electronic record of the following information relating 
to the transmittal order:
    (A) The name and address of the transmittor;
    (B) The amount of the transmittal order;
    (C) The execution date of the transmittal order;
    (D) Any payment instructions received from the transmittor with the 
transmittal order;
    (E) The identity of the recipient's financial institution;
    (F) As many of the following items as are received with the 
transmittal order: 2
---------------------------------------------------------------------------

    \2\ For transmittals of funds effected through the Federal Reserve's 
Fedwire funds transfer system by a domestic broker or dealers in 
securities, only one of the items is required to be retained, if 
received with the transmittal order, until such time as the bank that 
sends the order to the Federal Reserve Bank completes its conversion to 
the expanded Fedwire message format.
---------------------------------------------------------------------------

    (1) The name and address of the recipient;
    (2) The account number of the recipient; and
    (3) Any other specific identifier of the recipient; and
    (G) Any form relating to the transmittal of funds that is completed 
or signed by the person placing the transmittal order.
    (ii) For each transmittal order that it accepts as an intermediary 
financial institution, a financial institution shall retain either the 
original or a microfilm, other copy, or electronic record of the 
transmittal order.
    (iii) for each transmittal order that it accepts as a recipient's 
financial institution, a financial institution shall retain either the 
original or a microfilm, other copy, or electronic record of the 
transmittal order.
    (2) Transmittors other than established customers. In the case of a 
transmittal order from a transmittor that is not an established 
customer, in addition to obtaining and retaining the information 
required in paragraph (f)(1)(i) of this section:
    (i) If the transmittal order is made in person, prior to acceptance 
the transmittor's financial institution shall verify the identity of the 
person placing the transmittal order. If it accepts the transmittal 
order, the transmittor's financial institution shall obtain and retain a 
record of the name and address, the type of identification reviewed, and 
the number of the identification document (e.g., driver's license), as 
well as a record of the person's taxpayer identification number (e.g., 
social security or employer identification number) or, if none, alien 
identification number or passport number and country of issuance, or a 
notation in the record the lack thereof. If the transmittor's financial 
institution has knowledge that the person placing the transmittal order 
is not the transmittor, the transmittor's financial institution shall 
obtain and retain a record of the transmittor's taxpayer identification 
number (e.g., social security or employer identification number) or, if 
none, alien identification number or passport number and country of 
issuance, if known by the person placing the order, or a notation in the 
record the lack thereof.
    (ii) If the transmittal order accepted by the transmittor's 
financial institution is not made in person, the transmittor's financial 
institution shall obtain and retain a record of the name and address of 
the person placing the transmittal order, as well as the person's 
taxpayer identification number (e.g., social security or employer 
identification number) or, if none, alien identification number or 
passport number and country of issuance, or a notation in the record of 
the lack thereof, and a copy or record of the method of payment (e.g., 
check or credit card transaction) for the transmittal of funds. If the 
transmittor's financial institution has knowledge that the person 
placing the transmittal order is not the transmittor, the transmittor's 
financial institution shall obtain and retain a record of the 
transmittor's taxpayer identification number (e.g.,

[[Page 339]]

social security or employer identification number) or, if none, alien 
identification number or passport number and country of issuance, if 
known by the person placing the order, or a notation in the record the 
lack thereof.
    (3) Recipients other than established customers. For each 
transmittal order that it accepts as a recipient's financial institution 
for a recipient that is not an established customer, in addition to 
obtaining and retaining the information required in paragraph 
(f)(1)(iii) of this section:
    (i) If the proceeds are delivered in person to the recipient or its 
representative or agent, the recipient's financial institution shall 
verify the identity of the person receiving the proceeds and shall 
obtain and retain a record of the name and address, the type of 
identification reviewed, and the number of the identification document 
(e.g., driver's license), as well as a record of the person's taxpayer 
identification number (e.g., social security or employer identification 
number) or, if none, alien identification number or passport number and 
country of issuance, or a notation in the record of the lack thereof. If 
the recipient's financial institution has knowledge that the person 
receiving the proceeds is not the recipient, the recipient's financial 
institution shall obtain and retain a record of the recipient's name and 
address, as well as the recipient's taxpayer identification number 
(e.g., social security or employer identification number) or, if none, 
alien identification number or passport number and country of issuance, 
if known by the person receiving the proceeds, or a notation in the 
record of the lack thereof.
    (ii) If the proceeds are delivered other than in person, the 
recipient's financial institution shall retain a copy of the check or 
other instrument used to effect payment, or the information contained 
thereon, as well as the name and address of the person to which it was 
sent.
    (4) Retrievability. The information that a transmittor's financial 
institution must retain under paragraphs (f)(1)(i) and (f)(2) of this 
section shall be retrievable by the transmittor's financial institution 
by reference to the name of the transmittor. If the transmittor is an 
established customer of the transmittor's financial institution and has 
an account used for transmittals of funds, then the information also 
shall be retrievable by account number. The information that a 
recipient's financial institution must retain under paragraphs 
(f)(1)(iii) and (f)(3) of this section shall be retrievable by the 
recipient's financial institution by reference to the name of the 
recipient. If the recipient is an established customer of the 
recipient's financial institution and has an account used for 
transmittals of funds, then the information also shall be retrievable by 
account number. This information need not be retained in any particular 
manner, so long as the financial institution is able to retrieve the 
information required by this paragraph, either by accessing transmittal 
of funds records directly or through reference to some other record 
maintained by the financial institution.
    (5) Verification. Where verification is required under paragraphs 
(f)(2) and (f)(3) of this section, a financial institution shall verify 
a person's identity by examination of a document (other than a customer 
signature card), preferably one that contains the person's name, 
address, and photograph, that is normally acceptable by financial 
institutions as a means of identification when cashing checks for 
persons other than established customers. Verification of the identity 
of an individual who indicates that he or she is an alien or is not a 
resident of the United States may be made by passport, alien 
identification card, or other official document evidencing nationality 
or residence (e.g., a foreign driver's license with indication of home 
address).
    (6) Exceptions. The following transmittals of funds are not subject 
to the requirements of this section:
    (i) Transmittals of funds where the transmittor and the recipient 
are any of the following:
    (A) A bank;
    (B) A wholly-owned domestic subsidiary of a bank chartered in the 
United States;
    (C) A broker or dealer in securities;

[[Page 340]]

    (D) A wholly-owned domestic subsidiary of a broker or dealer in 
securities;
    (E) The United States;
    (F) A state or local government; or
    (G) A federal, state or local government agency or instrumentality; 
and
    (ii) Transmittals of funds where both the transmittor and the 
recipient are the same person and the transmittor's financial 
institution and the recipient's financial institution are the same 
broker or dealer in securities.
    (g) Any transmittor's financial institution or intermediary 
financial institution located within the United States shall include in 
any transmittal order for a transmittal of funds in the amount of $3,000 
or more, information as required in this paragraph (g):
    (1) A transmittor's financial institution shall include in a 
transmittal order, at the time it is sent to a receiving financial 
institution, the following information:
    (i) The name and, if the payment is ordered from an account, the 
account number of the transmittor;
    (ii) The address of the transmittor, except for a transmittal order 
through Fedwire until such time as the bank that sends the order to the 
Federal Reserve Bank completes its conversion to the expanded Fedwire 
format;
    (iii) The amount of the transmittal order;
    (iv) The execution date of the transmittal order;
    (v) The identity of the recipient's financial institution;
    (vi) As many of the following items as are received with the 
transmittal order: 3
---------------------------------------------------------------------------

    \3\ For transmittals of funds effected through the Federal Reserve's 
Fedwire funds transfer system by a financial institution, only one of 
the items is required to be included in the transmittal order, if 
received with the sender's transmittal order, until such time as the 
bank that sends the order to the Federal Reserve Bank completes its 
conversion to the expanded Fedwire message format.
---------------------------------------------------------------------------

    (A) The name and address of the recipient;
    (B) The account number of the recipient;
    (C) Any other specific identifier of the recipient; and
    (vii) Either the name and address or numerical identifier of the 
transmittor's financial institution.
    (2) A receiving financial institution that acts as an intermediary 
financial institution, if it accepts a transmittal order, shall include 
in a corresponding transmittal order at the time it is sent to the next 
receiving financial institution, the following information, if received 
from the sender:
    (i) The name and the account number of the transmittor;
    (ii) The address of the transmittor, except for a transmittal order 
through Fedwire until such time as the bank that sends the order to the 
Federal Reserve Bank completes its conversion to the expanded Fedwire 
format;
    (iii) The amount of the transmittal order;
    (iv) The execution date of the transmittal order;
    (v) The identity of the recipient's financial institution;
    (vi) As many of the following items as are received with the 
transmittal order: 4
---------------------------------------------------------------------------

    \4\ For transmittals of funds effected through the Federal Reserve's 
Fedwire funds transfer system by a financial institution, only one of 
the items is required to be included in the transmittal order, if 
received with the sender's transmittal order, until such time as the 
bank that sends the order to the Federal Reserve Bank completes its 
conversion to the expanded Fedwire message format.
---------------------------------------------------------------------------

    (A) The name and address of the recipient;
    (B) The account number of the recipient;
    (C) Any other specific identifier of the recipient; and
    (vii) Either the name and address or numerical identifier of the 
transmittor's financial institution.
    (3) Safe harbor for transmittals of funds prior to conversion to the 
expanded Fedwire message format. The following provisions apply to 
transmittals of funds effected through the Federal Reserve's Fedwire 
funds transfer system or otherwise by a financial institution before the 
bank that sends the order to the Federal Reserve Bank or otherwise 
completes its conversion to the expanded Fedwire message format.

[[Page 341]]

    (i) Transmittor's financial institution. A transmittor's financial 
institution will be deemed to be in compliance with the provisions of 
paragraph (g)(1) of this section if it:
    (A) Includes in the transmittal order, at the time it is sent to the 
receiving financial institution, the information specified in paragraphs 
(g)(1)(iii) through (v), and the information specified in paragraph 
(g)(1)(vi) of this section to the extent that such information has been 
received by the financial institution, and
    (B) Provides the information specified in paragraphs (g)(1)(i), (ii) 
and (vii) of this section to a financial institution that acted as an 
intermediary financial institution or recipient's financial institution 
in connection with the transmittal order, within a reasonable time after 
any such financial institution makes a request therefor in connection 
with the requesting financial institution's receipt of a lawful request 
for such information from a federal, state, or local law enforcement or 
financial regulatory agency, or in connection with the requesting 
financial institution's own Bank Secrecy Act compliance program.
    (ii) Intermediary financial institution. An intermediary financial 
institution will be deemed to be in compliance with the provisions of 
paragraph (g)(2) of this section if it:
    (A) Includes in the transmittal order, at the time it is sent to the 
receiving financial institution, the information specified in paragraphs 
(g)(2)(iii) through (g)(2)(vi) of this section, to the extent that such 
information has been received by the intermediary financial institution; 
and
    (B) Provides the information specified in paragraphs (g)(2)(i), (ii) 
and (vii) of this section, to the extent that such information has been 
received by the intermediary financial institution, to a financial 
institution that acted as an intermediary financial institution or 
recipient's financial institution in connection with the transmittal 
order, within a reasonable time after any such financial institution 
makes a request therefor in connection with the requesting financial 
institution's receipt of a lawful request for such information from a 
federal, state, or local law enforcement or regulatory agency, or in 
connection with the requesting financial institution's own Bank Secrecy 
Act compliance program.
    (iii) Obligation of requesting financial institution. Any 
information requested under paragraph (g)(3)(i)(B) or (g)(3)(ii)(B) of 
this section shall be treated by the requesting institution, once 
received, as if it had been included in the transmittal order to which 
such information relates.
    (4) Exceptions. The requirements of this paragraph (g) shall not 
apply to transmittals of funds that are listed in paragraph (e)(6) or 
(f)(6) of this section.

(Approved by the Office of Management and Budget under control number 
1505-0063)

[37 FR 6912, Apr. 5, 1972, as amended at 52 FR 11444, Apr. 8, 1987; 54 
FR 33679, Aug. 16, 1989; 60 FR 229, 238, Jan. 3, 1995; 61 FR 14385, 
14388, Apr. 1, 1996; 61 FR 18250, Apr. 25, 1996]



Sec. 103.34  Additional records to be made and retained by banks.

    (a)(1) With respect to each certificate of deposit sold or redeemed 
after May 31, 1978, or each deposit or share account opened with a bank 
after June 30, 1972, a bank shall, within 30 days from the date such a 
transaction occurs or an account is opened, secure and maintain a record 
of the taxpayer identification number of the customer involved; or where 
the account or certificate is in the names of two or more persons, the 
bank shall secure the taxpayer identification number of a person having 
a financial interest in the certificate or account. In the event that a 
bank has been unable to secure, within the 30-day period specified, the 
required identification, it shall nevertheless not be deemed to be in 
violation of this section if (i) it has made a reasonable effort to 
secure such identification, and (ii) it maintains a list containing the 
names, addresses, and account numbers of those persons from whom it has 
been unable to secure such identification, and makes the names, 
addresses, and account numbers of those persons available to the 
Secretary as directed by him. A bank acting as an agent for another 
person in the purchase or redemption of a certificate of deposit issued 
by another bank

[[Page 342]]

is responsible for obtaining and recording the required taxpayer 
identification, as well as for maintaining the records referred to in 
paragraphs (b) (11) and (12) of this section. The issuing bank can 
satisfy the recordkeeping requirement by recording the name and address 
of the agent together with a description of the instrument and the date 
of the transaction. Where a person is a non-resident alien, the bank 
shall also record the person's passport number or a description of some 
other government document used to verify his identity.
    (2) The 30-day period provided for in paragraph (a)(1) of this 
section shall be extended where the person opening the account has 
applied for a taxpayer identification or social security number on Form 
SS-4 or SS-5, until such time as the person maintaining the account has 
had a reasonable opportunity to secure such number and furnish it to the 
bank.
    (3) A taxpayer identification number required under paragraph (a)(1) 
of this section need not be secured for accounts or transactions with 
the following: (i) Agencies and instrumentalities of Federal, state, 
local or foreign governments; (ii) judges, public officials, or clerks 
of courts of record as custodians of funds in controversy or under the 
control of the court; (iii) aliens who are (A) ambassadors, ministers, 
career diplomatic or consular officers, or (B) naval, military or other 
attaches of foreign embassies and legations, and for the members of 
their immediate families; (iv) aliens who are accredited representatives 
of international organizations which are entitled to enjoy privileges, 
exemptions and immunities as an international organization under the 
International Organization Immunities Act of December 29, 1945 (22 
U.S.C. 288), and the members of their immediate families; (v) aliens 
temporarily residing in the United States for a period not to exceed 180 
days; (vi) aliens not engaged in a trade or business in the United 
States who are attending a recognized college or university or any 
training program, supervised or conducted by any agency of the Federal 
Government; (vii) unincorporated subordinate units of a tax exempt 
central organization which are covered by a group exemption letter, 
(viii) a person under 18 years of age with respect to an account opened 
as a part of a school thrift savings program, provided the annual 
interest is less than $10; (ix) a person opening a Christmas club, 
vacation club and similar installment savings programs provided the 
annual interest is less than $10; and (x) non-resident aliens who are 
not engaged in a trade or business in the United States. In instances 
described in paragraphs (a)(3), (viii) and (ix) of this section, the 
bank shall, within 15 days following the end of any calendar year in 
which the interest accrued in that year is $10 or more use its best 
effort to secure and maintain the appropriate taxpayer identification 
number or application form therefor.
    (4) The rules and regulations issued by the Internal Revenue Service 
under section 6109 of the Internal Revenue Code of 1954 shall determine 
what constitutes a taxpayer identification number and whose number shall 
be obtained in the case of an account maintained by one or more persons.
    (b) Each bank shall, in addition, retain either the original or a 
microfilm or other copy or reproduction of each of the following:
    (1) Each document granting signature authority over each deposit or 
share account, including any notations, if such are normally made, of 
specific identifying information verifying the identity of the signer 
(such as a driver's license number or credit card number);
    (2) Each statement, ledger card or other record on each deposit or 
share account, showing each transaction in, or with respect to, that 
account;
    (3) Each check, clean draft, or money order drawn on the bank or 
issued and payable by it, except those drawn for $100 or less or those 
drawn on accounts which can be expected to have drawn on them an average 
of at least 100 checks per month over the calendar year or on each 
occasion on which such checks are issued, and which are (i) dividend 
checks, (ii) payroll checks, (iii) employee benefit checks, (iv) 
insurance claim checks, (v) medical benefit checks, (vi) checks drawn on 
government agency accounts, (vii) checks

[[Page 343]]

drawn by brokers or dealers in securities, (viii) checks drawn on 
fiduciary accounts, (ix) checks drawn on other financial institutions, 
or (x) pension or annuity checks;
    (4) Each item in excess of $100 (other than bank charges or periodic 
charges made pursuant to agreement with the customer), comprising a 
debit to a customer's deposit or share account, not required to be kept, 
and not specifically exempted, under paragraph (b)(3) of this section;
    (5) Each item, including checks, drafts, or transfers of credit, of 
more than $10,000 remitted or transferred to a person, account or place 
outside the United States;
    (6) A record of each remittance or transfer of funds, or of 
currency, other monetary instruments, checks, investment securities, or 
credit, of more than $10,000 to a person, account or place outside the 
United States;
    (7) Each check or draft in an amount in excess of $10,000 drawn on 
or issued by a foreign bank which the domestic bank has paid or 
presented to a nonbank drawee for payment;
    (8) Each item, including checks, drafts or transfers of credit, of 
more than $10,000 received directly and not through a domestic financial 
institution, by letter, cable or any other means, from a bank, broker or 
dealer in foreign exchange outside the United States;
    (9) A record of each receipt of currency, other monetary 
instruments, investment securities or checks, and of each transfer of 
funds or credit, of more than $10,000 received on any one occasion 
directly and not through a domestic financial institution, from a bank, 
broker or dealer in foreign exchange outside the United States; and
    (10) Records prepared or received by a bank in the ordinary course 
of business, which would be needed to reconstruct a transaction account 
and to trace a check in excess of $100 deposited in such account through 
its domestic processing system or to supply a description of a deposited 
check in excess of $100. This subparagraph shall be applicable only with 
respect to demand deposits.
    (11) A record containing the name, address, and taxpayer 
identification number, if available, of the purchaser of each 
certificate of deposit, as well as a description of the instrument, a 
notation of the method of payment, and the date of the transaction.
    (12) A record containing the name, address and taxpayer 
identification number, if available, of any person presenting a 
certificate of deposit for payment, as well as a description of the 
instrument and the date of the transaction.
    (13) Each deposit slip or credit ticket reflecting a transaction in 
excess of $100 or the equivalent record for direct deposit or other wire 
transfer deposit transactions. The slip or ticket shall record the 
amount of any currency involved.

(Approved by the Office of Management and Budget under control number 
1505-0063)

[38 FR 2175, Jan. 22, 1973, as amended at 38 FR 3509, Feb. 7, 1973; 43 
FR 21672, May 19, 1978; 52 FR 11444, Apr. 8, 1987]



Sec. 103.35  Additional records to be made and retained by brokers or dealers in securities.

    (a)(1) With respect to each brokerage account opened with a broker 
or dealer in securities after June 30, 1972, by a person residing or 
doing business in the United States or a citizen of the United States, 
such broker or dealer shall within 30 days from the date such account is 
opened, secure and maintain a record of the taxpayer identification 
number of the person maintaining the account; or in the case of an 
account of one or more individuals, such broker or dealer shall secure 
and maintain a record of the social security number of an individual 
having a financial interest in that account. In the event that a broker 
or dealer has been unable to secure the identification required within 
the 30-day period specified, it shall nevertheless not be deemed to be 
in violation of this section if: (i) It has made a reasonable effort to 
secure such identification, and (ii) it maintains a list containing the 
names, addresses, and account numbers of those persons from whom it has 
been unable to secure such identification, and makes the names, 
addresses, and account numbers of those persons available to the 
Secretary as directed by him. Where a person is a non-resident alien, 
the broker

[[Page 344]]

or dealer in securities shall also record the person's passport number 
or a description of some other government document used to verify his 
identity.
    (2) The 30-day period provided for in paragraph (a)(1) of this 
section shall be extended where the person opening the account has 
applied for a taxpayer identification or social security number on Form 
SS-4 or SS-5, until such time as the person maintaining the account has 
had a reasonable opportunity to secure such number and furnish it to the 
broker or dealer.
    (3) A taxpayer identification number for a deposit or share account 
required under paragraph (a)(1) of this section need not be secured in 
the following instances: (i) Accounts for public funds opened by 
agencies and instrumentalities of Federal, state, local, or foreign 
governments, (ii) accounts for aliens who are (a) ambassadors, 
ministers, career diplomatic or consular officers, or (b) naval, 
military or other attaches of foreign embassies, and legations, and for 
the members of their immediate families, (iii) accounts for aliens who 
are accredited representatives to international organizations which are 
entitled to enjoy privileges, exemptions, and immunities as an 
international organization under the International Organizations 
Immunities Act of December 29, 1945 (22 U.S.C. 288), and for the members 
of their immediate families, (iv) aliens temporarily residing in the 
United States for a period not to exceed 180 days, (v) aliens not 
engaged in a trade or business in the United States who are attending a 
recognized college or university or any training program, supervised or 
conducted by any agency of the Federal Government, and (vi) 
unincorporated subordinate units of a tax exempt central organization 
which are covered by a group exemption letter.
    (b) Every broker or dealer in securities shall, in addition, retain 
either the original or a microfilm or other copy or reproduction of each 
of the following:
    (1) Each document granting signature or trading authority over each 
customer's account;
    (2) Each record described in Sec. 240.17a-3(a) (1), (2), (3), (5), 
(6), (7), (8), and (9) of Title 17, Code of Federal Regulations;
    (3) A record of each remittance or transfer of funds, or of 
currency, checks, other monetary instruments, investment securities, or 
credit, of more than $10,000 to a person, account, or place, outside the 
United States;
    (4) A record of each receipt of currency, other monetary 
instruments, checks, or investment securities and of each transfer of 
funds or credit, of more than $10,000 received on any one occasion 
directly and not through a domestic financial institution, from any 
person, account or place outside the United States.

(Approved by the Office of Management and Budget under control number 
1505-0063)

[37 FR 26518, Dec. 13, 1972, as amended at 38 FR 2176, Jan. 22, 1973; 52 
FR 11444, Apr. 8, 1987]



Sec. 103.36  Additional records to be made and retained by casinos.

    (a) With respect to each deposit of funds, account opened or line of 
credit extended after the effective date of these regulations, a casino 
shall, at the time the funds are deposited, the account is opened or 
credit is extended, secure and maintain a record of the name, permanent 
address, and social security number of the person involved. Where the 
deposit, account or credit is in the names of two or more persons, the 
casino shall secure the name, permanent address, and social security 
number of each person having a financial interest in the deposit, 
account or line of credit. The name and address of such person shall be 
verified by the casino at the time the deposit is made, account opened, 
or credit extended. The verification shall be made by examination of a 
document of the type described in Sec. 103.28, and the specific 
identifying information shall be recorded in the manner described in 
Sec. 103.28. In the event that a casino has been unable to secure the 
required social security number, it shall not be deemed to be in 
violation of this section if (1) it has made a reasonable effort to 
secure such number and (2) it maintains a list containing the names and 
permanent addresses of those persons from who it has been unable to 
obtain social security numbers and makes the names and addresses of

[[Page 345]]

those persons available to the Secretary upon request. Where a person is 
a nonresident alien, the casino shall also record the person's passport 
number or a description of some other government document used to verify 
his identity.
    (b) In addition, each casino shall retain either the original or a 
microfilm or other copy or reproduction of each of the following:
    (1) A record of each receipt (including but not limited to funds for 
safekeeping or front money) of funds by the casino for the account 
(credit or deposit) of any person. The record shall include the name, 
permanent address and social security number of the person from whom the 
funds were received, as well as the date and amount of the funds 
received. If the person from whom the funds were received is a non-
resident alien, the person's passport number or a description of some 
other government document used to verify the person's identity shall be 
obtained and recorded;
    (2) A record of each bookkeeping entry comprising a debit or credit 
to a customer's deposit account or credit account with the casino;
    (3) Each statement, ledger card or other record of each deposit 
account or credit account with the casino, showing each transaction 
(including deposits, receipts, withdrawals, disbursements or transfers) 
in or with respect to, a customer's deposit account or credit account 
with the casino;
    (4) A record of each extension of credit in excess of $2,500, the 
terms and conditions of such extension of credit, and repayments. The 
record shall include the customer's name, permanent address, social 
security number, and the date and amount of the transaction (including 
repayments). If the customer or person for whom the credit extended is a 
non-resident alien, his passport number or description of some other 
government document used to verify his identity shall be obtained and 
recorded;
    (5) A record of each advice, request or instruction received or 
given by the casino for itself or another person with respect to a 
transaction involving a person, account or place outside the United 
States (including but not limited to communications by wire, letter, or 
telephone). If the transfer outside the United States is on behalf of a 
third party, the record shall include the third party's name, permanent 
address, social security number, signature, and the date and amount of 
the transaction. If the transfer is received from outside the United 
States on behalf of a third party, the record shall include the third 
party's name, permanent address, social security number, signature, and 
the date and amount of the transaction. If the person for whom the 
transaction is being made is a non-resident alien the record shall also 
include the person's name, his passport number or a description of some 
other government document used to verify his identity;
    (6) Records prepared or received by the casino in the ordinary 
course of business which would be needed to reconstruct a person's 
deposit account or credit account with the casino or to trace a check 
deposited with the casino through the casino's records to the bank of 
deposit;
    (7) All records, documents or manuals required to be maintained by a 
casino under state and local laws or regulations, regulations of any 
governing Indian tribe or tribal government, or terms of (or any 
regulations issued under) any Tribal-State compacts entered into 
pursuant to the Indian Gaming Regulatory Act, with respect to the casino 
in question.
    (8) All records which are prepared or used by a casino to monitor a 
customer's gaming activity.
    (9)(i) A separate record containing a list of each transaction 
between the casino and its customers involving the following types of 
instruments having a face value of $3,000 or more:
    (A) Personal checks (excluding instruments which evidence credit 
granted by a casino strictly for gaming, such as markers);
    (B) Business checks (including casino checks);
    (C) Official bank checks;
    (D) Cashier's checks;
    (E) Third-party checks;
    (F) Promissory notes;
    (G) Traveler's checks; and
    (H) Money orders.

[[Page 346]]

    (ii) The list will contain the time, date, and amount of the 
transaction; the name and permanent address of the customer; the type of 
instrument; the name of the drawee or issuer of the instrument; all 
reference numbers (e.g., casino account number, personal check number, 
etc.); and the name or casino license number of the casino employee who 
conducted the transaction. Applicable transactions will be placed on the 
list in the chronological order in which they occur.
    (10) A copy of the compliance program described in Sec. 103.64(a).
    (11) In the case of card clubs only, records of all currency 
transactions by customers, including without limitation, records in the 
form of currency transaction logs and multiple currency transaction 
logs, and records of all activity at cages or similar facilities, 
including, without limitation, cage control logs.
    (c)(1) Casinos which input, store, or retain, in whole or in part, 
for any period of time, any record required to be maintained by 
Sec. 103.33 or this section on computer disk, tape, or other machine-
readable media shall retain the same on computer disk, tape, or machine-
readable media.
    (2) All indexes, books, programs, record layouts, manuals, formats, 
instructions, file descriptions, and similar materials which would 
enable a person readily to access and review the records that are 
described in Sec. 103.33 and this section and that are input, stored, or 
retained on computer disk, tape, or other machine-readable media shall 
be retained for the period of time such records are required to be 
retained.

(Approved by the Office of Management and Budget under control numbers 
1505-0087 and 1505-0063)

[50 FR 5068, Feb. 6, 1985, as amended at 52 FR 11444, Apr. 8, 1987; 54 
FR 1167, Jan. 12, 1989; 58 FR 13547, Mar. 12, 1993; 59 FR 61662, Dec. 1, 
1994; 61 FR 7056, Feb. 23, 1996; 63 FR 1924, Jan. 13, 1998; 64 FR 45453, 
Aug. 20, 1999]



Sec. 103.37  Additional records to be made and retained by currency dealers or exchangers.

    (a)(1) After July 7, 1987, each currency dealer or exchanger shall 
secure and maintain a record of the taxpayer identification number of 
each person for whom a transaction account is opened or a line of credit 
is extended within 30 days after such account is opened or credit line 
extended. Where a person is a non-resident alien, the currency dealer or 
exchanger shall also record the person's passport number or a 
description of some other government document used to verify his 
identity. Where the account or credit line is in the names of two or 
more persons, the currency dealer or exchanger shall secure the taxpayer 
identification number of a person having a financial interest in the 
account or credit line. In the event that a currency dealer or exchanger 
has been unable to secure the identification required within the 30-day 
period specified, it shall nevertheless not be deemed to be in violation 
of this section if:
    (i) It has made a reasonable effort to secure such identification, 
and
    (ii) It maintains a list containing the names, addresses, and 
account or credit line numbers of those persons from whom it has been 
unable to secure such identification, and makes the names, addresses, 
and account or credit line numbers of those persons available to the 
Secretary as directed by him.
    (2) The 30-day period provided for in paragraph (a)(1) of this 
section shall be extended where the person opening the account or credit 
line has applied for a taxpayer identification or social security number 
on Form SS-4 or SS-5, until such time as the person maintaining the 
account or credit line has had a reasonable opportunity to secure such 
number and furnish it to the currency dealer or exchanger.
    (3) A taxpayer identification number for an account or credit line 
required under paragraph (a)(1) of this section need not be secured in 
the following instances:
    (i) Accounts for public funds opened by agencies and 
instrumentalities of Federal, state, local or foreign governments,
    (ii) Accounts for aliens who are--
    (A) Ambassadors, ministers, career diplomatic or consular officers, 
or
    (B) Naval, military or other attaches of foreign embassies, and 
legations, and for members of their immediate families,

[[Page 347]]

    (iii) Accounts for aliens who are accredited representatives to 
international organizations which are entitled to enjoy privileges, 
exemptions, and immunities as an international organization under the 
International Organizations Immunities Act of December 29, 1945 (22 
U.S.C. 288), and for the members of their immediate families,
    (iv) Aliens temporarily residing in the United States for a period 
not to exceed 180 days,
    (v) Aliens not engaged in a trade or business in the United States 
who are attending a recognized college or any training program, 
supervised or conducted by any agency of the Federal Government, and
    (vi) Unincorporated subordinate units of a tax exempt central 
organization which are covered by a group exemption letter.
    (b) Each currency dealer or exchanger shall retain either the 
original or a microfilm or other copy or reproduction of each of the 
following:
    (1) Statements of accounts from banks, including paid checks, 
charges or other debit entry memoranda, deposit slips and other credit 
memoranda representing the entries reflected on such statements;
    (2) Daily work records, including purchase and sales slips or other 
memoranda needed to identify and reconstruct currency transactions with 
customers and foreign banks;
    (3) A record of each exchange of currency involving transactions in 
excess of $1000, including the name and address of the customer (and 
passport number or taxpayer identification number unless received by 
mail or common carrier) date and amount of the transaction and currency 
name, country, and total amount of each foreign currency;
    (4) Signature cards or other documents evidencing signature 
authority over each deposit or security account, containing the name of 
the depositor, street address, taxpayer identification number (TIN) or 
employer identification number (EIN) and the signature of the depositor 
or of a person authorized to sign on the account (if customer accounts 
are maintained in a code name, a record of the actual owner of the 
account);
    (5) Each item, including checks, drafts, or transfers of credit, of 
more than $10,000 remitted or transferred to a person, account or place 
outside the United States;
    (6) A record of each receipt of currency, other monetary 
instruments, investment securities and checks, and of each transfer of 
funds or credit, or more than $10,000 received on any one occasion 
directly and not through a domestic financial institution, from any 
person, account or place outside the United States;
    (7) Records prepared or received by a dealer in the ordinary course 
of business, that would be needed to reconstruct an account and trace a 
check in excess of $100 deposited in such account through its internal 
recordkeeping system to its depository institution, or to supply a 
description of a deposited check in excess of $100;
    (8) A record maintaining the name, address and taxpayer 
identification number, if available, of any person presenting a 
certificate of deposit for payment, as well as a description of the 
instrument and date of transaction;
    (9) A system of books and records that will enable the currency 
dealer or exchanger to prepare an accurate balance sheet and income 
statement.
    (c) This section does not apply to banks that offer services in 
dealing or changing currency to their customers as an adjunct to their 
regular service.

(Approved by the Office of Management and Budget under control number 
1505-0063)

[52 FR 11444, Apr. 8, 1987, as amended at 64 FR 45453, Aug. 20, 1999]



Sec. 103.38  Nature of records and retention period.

    (a) Wherever it is required that there be retained either the 
original or a microfilm or other copy or reproduction of a check, draft, 
monetary instrument, investment security, or other similar instrument, 
there shall be retained a copy of both front and back of each such 
instrument or document, except that no copy need be retained of the back 
of any instrument or document which is entirely blank or which contains 
only standardized printed information, a copy of which is on file.
    (b) Records required by this subpart to be retained by financial 
institutions

[[Page 348]]

may be those made in the ordinary course of business by a financial 
institution. If no record is made in the ordinary course of business of 
any transaction with respect to which records are required to be 
retained by this subpart, then such a record shall be prepared in 
writing by the financial institution.
    (c) The rules and regulations issued by the Internal Revenue Service 
under 26 U.S.C. 6109 determine what constitutes a taxpayer 
identification number and whose number shall be obtained in the case of 
an account maintained by one or more persons.
    (d) All records that are required to be retained by this part shall 
be retained for a period of five years. Records or reports required to 
be kept pursuant to an order issued under Sec. 103.26 of this part shall 
be retained for the period of time specified in such order, not to 
exceed five years. All such records shall be filed or stored in such a 
way as to be accessible within a reasonable period of time, taking into 
consideration the nature of the record, and the amount of time expired 
since the record was made.

(Approved by the Office of Management and Budget under control number 
1505-0063)

[37 FR 6912, Apr. 5, 1972. Redesignated at 50 FR 5068, Feb. 6, 1985, and 
further redesignated and amended at 52 FR 11444, 11445, Apr. 8, 1987; 54 
FR 33679, Aug. 16, 1989]



Sec. 103.39  Person outside the United States.

    For the purposes of this subpart, a remittance or transfer of funds, 
or of currency, other monetary instruments, checks, investment 
securities, or credit to the domestic account of a person whose address 
is known by the person making the remittance or transfer, to be outside 
the United States, shall be deemed to be a remittance or transfer to a 
person outside the United States, except that, unless otherwise directed 
by the Secretary, this section shall not apply to a transaction on the 
books of a domestic financial institution involving the account of a 
customer of such institution whose address is within approximately 50 
miles of the location of the institution, or who is known to be 
temporarily outside the United States.

[37 FR 6912, Apr. 5, 1972. Redesignated at 50 FR 5068, Feb. 6, 1985 and 
52 FR 11444, Apr. 8, 1987]



         Subpart D--Special Rules for Money Services Businesses

    Source: 64 FR 45451, Aug. 20, 1999, unless otherwise noted.



Sec. 103.41  Registration of money services businesses.

    (a) Registration requirement--(1) In general. Except as provided in 
paragraph (a)(2) of this section, relating to agents, each money 
services business (whether or not licensed as a money services business 
by any State) must register with the Department of the Treasury and, as 
part of that registration, maintain a list of its agents as required by 
31 U.S.C. 5330 and this section. This section does not apply to the 
United States Postal Service, to agencies of the United States, of any 
State, or of any political subdivision of a State, or to a person to the 
extent that the person is an issuer, seller, or redeemer of stored 
value.
    (2) Agents. A person that is a money services business solely 
because that person serves as an agent of another money services 
business, see Sec. 103.11(uu), is not required to register under this 
section, but a money services business that engages in activities 
described in Sec. 103.11(uu) both on its own behalf and as an agent for 
others must register under this section. For example, a supermarket 
corporation that acts as an agent for an issuer of money orders and 
performs no other services of a nature and value that would cause the 
corporation to be a money services business, is not required to 
register; the answer would be the same if the supermarket corporation 
served as an agent both of a money order issuer and of a money 
transmitter. However, registration would be required if the supermarket 
corporation, in addition to acting as an agent of an issuer of money 
orders, cashed checks or exchanged currencies (other than as an agent 
for another business) in an amount greater than $1,000 in currency or 
monetary or other instruments for

[[Page 349]]

any person on any day, in one or more transactions.
    (3) Agency status. The determination whether a person is an agent 
depends on all the facts and circumstances.
    (b) Registration procedures--(1) In general. (i) A money services 
business must be registered by filing such form as FinCEN may specify 
with the Detroit Computing Center of the Internal Revenue Service (or 
such other location as the form may specify). The information required 
by 31 U.S.C. 5330(b) and any other information required by the form must 
be reported in the manner and to the extent required by the form.
    (ii) A branch office of a money services business is not required to 
file its own registration form. A money services business must, however, 
report information about its branch locations or offices as provided by 
the instructions to the registration form.
    (iii) A money services business must retain a copy of any 
registration form filed under this section and any registration number 
that may be assigned to the business at a location in the United States 
and for the period specified in Sec. 103.38(d).
    (2) Registration period. A money services business must be 
registered for the initial registration period and each renewal period. 
The initial registration period is the two-calendar-year period 
beginning with the calendar year in which the money services business is 
first required to be registered. However, the initial registration 
period for a money services business required to register by December 
31, 2001 (see paragraph (b)(3) of this section) is the two-calendar year 
period beginning 2002. Each two-calendar-year period following the 
initial registration period is a renewal period.
    (3) Due date. The registration form for the initial registration 
period must be filed on or before the later of December 31, 2001, and 
the end of the 180-day period beginning on the day following the date 
the business is established. The registration form for a renewal period 
must be filed on or before the last day of the calendar year preceding 
the renewal period.
    (4) Events requiring re-registration. If a money services business 
registered as such under the laws of any State experiences a change in 
ownership or control that requires the business to be re-registered 
under State law, the money services business must also be re-registered 
under this section. In addition, if there is a transfer of more than 10 
percent of the voting power or equity interests of a money services 
business (other than a money services business that must report such 
transfer to the Securities and Exchange Commission), the money services 
business must be re-registered under this section. Finally, if a money 
services business experiences a more than 50-per cent increase in the 
number of its agents during any registration period, the money services 
business must be re-registered under this section. The registration form 
must be filed not later than 180 days after such change in ownership, 
transfer of voting power or equity interests, or increase in agents. The 
calendar year in which the change, transfer, or increase occurs is 
treated as the first year of a new two-year registration period.
    (c) Persons required to file the registration form. Under 31 U.S.C. 
5330(a), any person who owns or controls a money services business is 
responsible for registering the business; however, only one registration 
form is required to be filed for each registration period. A person is 
treated as owning or controlling a money services business for purposes 
of filing the registration form only to the extent provided by the form. 
If more than one person owns or controls a money services business, the 
owning or controlling persons may enter into an agreement designating 
one of them to register the business. The failure of the designated 
person to register the money services business does not, however, 
relieve any of the other persons who own or control the business of 
liability for the failure to register the business. See paragraph (e) of 
this section, relating to consequences of the failure to comply with 31 
U.S.C. 5330 or this section.
    (d) List of agents--(1) In general. A money services business must 
prepare and maintain a list of its agents. The initial list of agents 
must be prepared by January 1, 2002, and must be revised each January 1, 
for the immediately

[[Page 350]]

preceding 12 month period; for money services businesses established 
after December 31, 2001, the initial agent list must be prepared by the 
due date of the initial registration form and must be revised each 
January 1 for the immediately preceding 12-month period. The list is not 
filed with the registration form but must be maintained at the location 
in the United States reported on the registration form under paragraph 
(b)(1) of this section. Upon request, a money services business must 
make its list of agents available to FinCEN and any other appropriate 
law enforcement agency (including, without limitation, the examination 
function of the Internal Revenue Service in its capacity as delegee of 
Bank Secrecy Act examination authority). Requests for information made 
pursuant to the preceding sentence shall be coordinated through FinCEN 
in the manner and to the extent determined by FinCEN. The original list 
of agents and any revised list must be retained for the period specified 
in Sec. 103.38(d).
    (2) Information included on the list of agents--(i) In general. 
Except as provided in paragraph (d)(2)(ii) of this section, a money 
services business must include the following information with respect to 
each agent on the list (including any revised list) of its agents--
    (A) The name of the agent, including any trade names or doing-
business-as names;
    (B) The address of the agent, including street address, city, state, 
and ZIP code;
    (C) The telephone number of the agent;
    (D) The type of service or services (money orders, traveler's 
checks, check sales, check cashing, currency exchange, and money 
transmitting) the agent provides;
    (E) A listing of the months in the 12 months immediately preceding 
the date of the most recent agent list in which the gross transaction 
amount of the agent with respect to financial products or services 
issued by the money services business maintaining the agent list 
exceeded $100,000. For this purpose, the money services gross 
transaction amount is the agent's gross amount (excluding fees and 
commissions) received from transactions of one or more businesses 
described in Sec. 103.11(uu);
    (F) The name and address of any depository institution at which the 
agent maintains a transaction account (as defined in 12 U.S.C. 
461(b)(1)(C)) for all or part of the funds received in or for the 
financial products or services issued by the money services business 
maintaining the list, whether in the agent's or the business principal's 
name;
    (G) The year in which the agent first became an agent of the money 
services business; and
    (H) The number of branches or subagents the agent has.
    (ii) Special rules. Information about agent volume must be current 
within 45 days of the due date of the agent list. The information 
described by paragraphs (d)(2)(i)(G) and (d)(2)(i)(H) of this section is 
not required to be included in an agent list with respect to any person 
that is an agent of the money services business maintaining the list 
before the first day of the month beginning after February 16, 2000 so 
long as the information described by paragraphs (d)(2)(i)(G) and 
(d)(2)(i)(H) of this section is made available upon the request of 
FinCEN and any other appropriate law enforcement agency (including, 
without limitation, the examination function of the Internal Revenue 
Service in its capacity as delegee of Bank Secrecy Act examination 
authority).
    (e) Consequences of failing to comply with 31 U.S.C. 5330 or the 
regulations thereunder. It is unlawful to do business without complying 
with 31 U.S.C. 5330 and this section. A failure to comply with the 
requirements of 31 U.S.C 5330 or this section includes the filing of 
false or materially incomplete information in connection with the 
registration of a money services business. Any person who fails to 
comply with any requirement of 31 U.S.C. 5330 or this section shall be 
liable for a civil penalty of $5,000 for each violation. Each day a 
violation of 31 U.S.C. 5330 or this section continues constitutes a 
separate violation. In addition, under 31 U.S.C. 5320, the Secretary of 
the Treasury may bring a civil action to enjoin the violation. See 18 
U.S.C. 1960 for a criminal penalty for failure to

[[Page 351]]

comply with the registration requirements of 31 U.S.C. 5330 or this 
section.
    (f) Effective date. This section is effective September 20, 1999. 
Registration of money services businesses under this section will not be 
required prior to December 31, 2001.



                      Subpart E--General Provisions

    Source: 37 FR 6912, Apr. 5, 1972, unless otherwise noted. 
Redesignated at 64 FR 45451, Aug. 20, 1999.



Sec. 103.51  Dollars as including foreign currency.

    Wherever in this part an amount is stated in dollars, it shall be 
deemed to mean also the equivalent amount in any foreign currency.



Sec. 103.52  Photographic or other reproductions of Government obligations.

    Nothing herein contained shall require or authorize the microfilming 
or other reproduction of
    (a) Currency or other obligation or security of the United States as 
defined in 18 U.S.C. 8, or
    (b) Any obligation or other security of any foreign government, the 
reproduction of which is prohibited by law.



Sec. 103.53  Availability of information.

    (a) The Secretary may within his discretion disclose information 
reported under this part for any reason consistent with the purposes of 
the Bank Secrecy Act, including those set forth in paragraphs (b) 
through (d) of this section.
    (b) The Secretary may make any information set forth in any report 
received pursuant to this part available to another agency of the United 
States, to an agency of a state or local government or to an agency of a 
foreign government, upon the request of the head of such department or 
agency made in writing and stating the particular information desired, 
the criminal, tax or regulatory purpose for which the information is 
sought, and the official need for the information.
    (c) The Secretary may make any information set forth in any report 
received pursuant to this part available to the Congress, or any 
committee or subcommittee thereof, upon a written request stating the 
particular information desired, the criminal, tax or regulatory purpose 
for which the information is sought, and the official need for the 
information.
    (d) The Secretary may make any information set forth in any report 
received pursuant to this part available to any other department or 
agency of the United States that is a member of the Intelligence 
Community, as defined by Executive Order 12333 or any succeeding 
executive order, upon the request of the head of such department or 
agency made in writing and stating the particular information desired, 
the national security matter with which the information is sought and 
the official need therefor.
    (e) Any information made available under this section to other 
department or agencies of the United States, any state or local 
government, or any foreign government shall be received by them in 
confidence, and shall not be disclosed to any person except for official 
purposes relating to the investigation, proceeding or matter in 
connection with which the information is sought.
    (f) The Secretary may require that a state or local government 
department or agency requesting information under paragraph (b) of this 
section pay fees to reimburse the Department of the Treasury for costs 
incidental to such disclosure. The amount of such fees will be set in 
accordance with the statute on fees for government services, 31 U.S.C. 
9701.

(Approved by the Office of Management and Budget under control number 
1505-0104)

[50 FR 42693, Oct. 22, 1985, as amended at 50 FR 46283, Nov. 7, 1985; 52 
FR 35545, Sept. 22, 1987]



Sec. 103.54  Disclosure.

    All reports required under this part and all records of such reports 
are specifically exempted from disclosure under section 552 of Title 5, 
United States Code.

[[Page 352]]



Sec. 103.55  Exceptions, exemptions, and reports.

    (a) The Secretary, in his sole discretion, may by written order or 
authorization make exceptions to or grant exemptions from the 
requirements of this part. Such exceptions or exemptions may be 
conditional or unconditional, may apply to particular persons or to 
classes of persons, and may apply to particular transactions or classes 
of transactions. They shall, however, be applicable only as expressly 
stated in the order of authorization, and they shall be revocable in the 
sole discretion of the Secretary.
    (b) The Secretary shall have authority to further define all terms 
used herein.
    (c)(1) The Secretary may, as an alternative to the reporting and 
recordkeeping requirements for casinos in Secs. 103.22(a)(2) and 
103.25(a)(2), and 103.36, grant exemptions to the casinos in any state 
whose regulatory system substantially meets the reporting and 
recordkeeping requirements of this part.
    (2) In order for a state regulatory system to qualify for an 
exemption on behalf of its casinos, the state must provide:
    (i) That the Treasury Department be allowed to evaluate the 
effectiveness of the state's regulatory system by periodic oversight 
review of that system;
    (ii) That the reports required under the state's regulatory system 
be submitted to the Treasury Department within 15 days of receipt by the 
state;
    (iii) That any records required to be maintained by the casinos 
relevant to any matter under this part and to which the state has access 
or maintains under its regulatory system be made available to the 
Treasury Department within 30 days of request;
    (iv) That the Treasury Department be provided with periodic status 
reports on the state's compliance efforts and findings;
    (v) That all but minor violations of the state requirements be 
reported to Treasury within 15 days of discovery; and
    (vi) That the state will initiate compliance examinations of 
specific institutions at the request of Treasury within a reasonable 
time, not to exceed 90 days where appropriate, and will provide reports 
of these examinations to Treasury within 15 days of completion or 
periodically during the course of the examination upon the request of 
the Secretary. If for any reason the state were not able to conduct an 
investigation within a reasonable time, the state will permit Treasury 
to conduct the investigation.
    (3) Revocation of any exemption under this subsection shall be in 
the sole discretion of the Secretary.

[38 FR 2176, Jan. 22, 1973, as amended at 50 FR 5069, Feb. 6, 1985; 50 
FR 36875, Sept. 10, 1985]



Sec. 103.56  Enforcement.

    (a) Overall authority for enforcement and compliance, including 
coordination and direction of procedures and activities of all other 
agencies exercising delegated authority under this part, is delegated to 
the Assistant Secretary (Enforcement).
    (b) Authority to examine institutions to determine compliance with 
the requirements of this part is delegated as follows:
    (1) To the Comptroller of the Currency with respect to those 
financial institutions regularly examined for safety and soundness by 
national bank examiners;
    (2) To the Board of Governors of the Federal Reserve System with 
respect to those financial institutions regularly examined for safety 
and soundness by Federal Reserve bank examiners;
    (3) To the Federal Deposit Insurance Corporation with respect to 
those financial institutions regularly examined for safety and soundness 
by FDIC bank examiners;
    (4) To the Federal Home Loan Bank Board with respect to those 
financial institutions regularly examined for safety and soundness by 
FHLBB bank examiners;
    (5) To the Chairman of the Board of the National Credit Union 
Administration with respect to those financial institutions regularly 
examined for safety and soundness by NCUA examiners.
    (6) To the Securities and Exchange Commission with respect to 
brokers or dealers in securities;
    (7) To the Commissioner of Customs with respect to Secs. 103.23 and 
103.58;

[[Page 353]]

    (8) To the Commissioner of Internal Revenue with respect to all 
financial institutions, except brokers or dealers in securities, not 
currently examined by Federal bank supervisory agencies for soundness 
and safety.
    (c) Authority for investigating criminal violations of this part is 
delegated as follows:
    (1) To the Commissioner of Customs with respect to Sec. 103.23;
    (2) To the Commissioner of Internal Revenue except with respect to 
Sec. 103.23.
    (d) Authority for the imposition of civil penalties for violations 
of this part lies with the Assistant Secretary, and in the Assistant 
Secretary's absence, the Deputy Assistant Secretary (Law Enforcement).
    (e) Periodic reports shall be made to the Assistant Secretary by 
each agency to which compliance authority has been delegated under 
paragraph (b) of this section. These reports shall be in such a form and 
submitted at such intervals as the Assistant Secretary may direct. 
Evidence of specific violations of any of the requirements of this part 
may be submitted to the Assistant Secretary at any time.
    (f) The Assistant Secretary or his delegate, and any agency to which 
compliance has been delegated under paragraph (b) of this section, may 
examine any books, papers, records, or other data of domestic financial 
institutions relevant to the recordkeeping or reporting requirements of 
this part.

(Sec. 21, Federal Deposit Insurance Act, 84 Stat. 1114, 12 U.S.C. 1829b; 
84 Stat. 1116, 12 U.S.C. 1951-1959; and the Currency and Foreign 
Transactions Reporting Act, 84 Stat. 1118, 31 U.S.C. 1051-1122)

[37 FR 6912, Apr. 5, 1972, as amended at 50 FR 42693, Oct. 22, 1985; 52 
FR 11445, Apr. 8, 1987. Redesignated and amended at 64 FR 45451, 45453, 
Aug. 20, 1999]



Sec. 103.57  Civil penalty.

    (a) For any willful violation, committed on or before October 12, 
1984, of any reporting requirement for financial institutions under this 
part or of any recordkeeping requirements of Sec. 103.22, the Secretary 
may assess upon any domestic financial institution, and upon any 
partner, director, officer, or employee thereof who willfully 
participates in the violation, a civil penalty not to exceed $1,000.
    (b) For any willful violation committed after October 12, 1984 and 
before October 28, 1986, of any reporting requirement for financial 
institutions under this part or of the recordkeeping requirements of 
Sec. 103.32, the Secretary may assess upon any domestic financial 
institution, and upon any partner, director, officer, or employee 
thereof who willfully participates in the violation, a civil penalty not 
to exceed $10,000.
    (c) For any willful violation of any recordkeeping requirement for 
financial institutions, except violations of Sec. 103.32, under this 
part, the Secretary may assess upon any domestic financial institution, 
and upon any partner, director, officer, or employee thereof who 
willfully participates in the violation, a civil penalty not to exceed 
$1,000.
    (d) For any failure to file a report required under Sec. 103.23 or 
for filing such a report containing any material omission or 
misstatement, the Secretary may assess a civil penalty up to the amount 
of the currency or monetary instruments transported, mailed or shipped, 
less any amount forfeited under Sec. 103.58.
    (e) For any willful violation of Sec. 103.63 committed after January 
26, 1987, the Secretary may assess upon any person a civil penalty not 
to exceed the amount of coins and currency involved in the transaction 
with respect to which such penalty is imposed. The amount of any civil 
penalty assessed under this paragraph shall be reduced by the amount of 
any forfeiture to the United States in connection with the transaction 
for which the penalty was imposed.
    (f) For any willful violation committed after October 27, 1986, of 
any reporting requirement for financial institutions under this part 
(except Sec. 103.24, Sec. 103.25 or Sec. 103.32), the Secretary may 
assess upon any domestic financial institution, and upon any partner, 
director, officer, or employee thereof who willfully participates in the 
violation, a civil penalty not to exceed the greater of the amount (not 
to exceed $100,000) involved in the transaction or $25,000.

[[Page 354]]

    (g) For any willful violation committed after October 27, 1986, of 
any requirement of Sec. 103.24, Sec. 103.25, or Sec. 103.32, the 
Secretary may assess upon any person, a civil penalty:
    (1) In the case of a violation of Sec. 103.25 involving a 
transaction, a civil penalty not to exceed the greater of the amount 
(not to exceed $100,000) of the transaction, or $25,000; and
    (2) In the case of a violation of Sec. 103.24 or Sec. 103.32 
involving a failure to report the existence of an account or any 
identifying information required to be provided with respect to such 
account, a civil penalty not to exceed the greater of the amount (not to 
exceed $100,000) equal to the balance in the account at the time of the 
violation, or $25,000.
    (h) For each negligent violation of any requirement of this part, 
committed after October 27, 1986, the Secretary may assess upon any 
financial institution a civil penalty not to exceed $500.

[37 FR 6912, Apr. 5, 1972, as amended at 52 FR 11445, Apr. 8, 1987; 52 
FR 12641, Apr. 17, 1987. Redesignated and amended at 64 FR 45451, 45453, 
Aug. 20, 1999]



Sec. 103.58  Forfeiture of currency or monetary instruments.

    Any currency or other monetary instruments which are in the process 
of any transportation with respect to which a report is required under 
Sec. 103.23 are subject to seizure and forfeiture to the United States 
if such report has not been filed as required in Sec. 103.25, or 
contains material omissions or misstatements. The Secretary may, in his 
sole discretion, remit or mitigate any such forfeiture in whole or in 
part upon such terms and conditions as he deems reasonable.



Sec. 103.59  Criminal penalty.

    (a) Any person who willfully violates any provision of Title I of 
Pub. L. 91-508, or of this part authorized thereby may, upon conviction 
thereof, be fined not more than $1,000 or be imprisoned not more than 1 
year, or both. Such person may in addition, if the violation is of any 
provision authorized by Title I of Pub. L. 91-508 and if the violation 
is committed in furtherance of the commission of any violation of 
Federal law punishable by imprisonment for more than 1 year, be fined 
not more than $10,000 or be imprisoned not more than 5 years, or both.
    (b) Any person who willfully violates any provision of Title II of 
Pub. L. 91-508, or of this part authorized thereby, may, upon conviction 
thereof, be fined not more than $250,000 or be imprisoned not more than 
5 years, or both.
    (c) Any person who willfully violates any provision of Title II of 
Pub. L. 91-508, or of this part authorized thereby, where the violation 
is either
    (1) Committed while violating another law of the United States, or
    (2) Committed as part of a pattern of any illegal activity involving 
more than $100,000 in any 12-month period, may, upon conviction thereof, 
be fined not more than $500,000 or be imprisoned not more than 10 years, 
or both.
    (d) Any person who knowingly makes any false, fictitious or 
fraudulent statement or representation in any report required by this 
part may, upon conviction thereof, be fined not more than $10,000 or be 
imprisoned not more than 5 years, or both.

[37 FR 6912, Apr. 5, 1972, as amended at 50 FR 18479, May 1, 1985; 53 FR 
4138, Feb. 12, 1988]



Sec. 103.60  Enforcement authority with respect to transportation of currency or monetary instruments.

    (a) If a customs officer has reasonable cause to believe that there 
is a monetary instrument being transported without the filing of the 
report required by Secs. 103.23 and 103.25 of this chapter, he may stop 
and search, without a search warrant, a vehicle, vessel, aircraft, or 
other conveyance, envelope or other container, or person entering or 
departing from the United States with respect to which or whom the 
officer reasonably believes is transporting such instrument.
    (b) If the Secretary has reason to believe that currency or monetary 
instruments are in the process of transportation and with respect to 
which a report required under Sec. 103.23 has not been filed or contains 
material omissions or misstatements, he may apply to any court of 
competent jurisdiction for a search warrant. Upon a showing of probable 
cause, the court may issue a warrant authorizing the search of any or 
all of the following:

[[Page 355]]

    (1) One or more designated persons.
    (2) One or more designated or described places or premises.
    (3) One or more designated or described letters, parcels, packages, 
or other physical objects.
    (4) One or more designated or described vehicles. Any application 
for a search warrant pursuant to this section shall be accompanied by 
allegations of fact supporting the application.
    (c) This section is not in derogation of the authority of the 
Secretary under any other law or regulation.

[37 FR 6912, Apr. 5, 1972, as amended at 50 FR 18479, May 1, 1985]



Sec. 103.61  Access to records.

    Except as provided in Secs. 103.34(a)(1), 103.35(a)(1), and 
103.36(a) and except for the purpose of assuring compliance with the 
recordkeeping and reporting requirements of this part, this part does 
not authorize the Secretary or any other person to inspect or review the 
records required to be maintained by subpart C of this part. Other 
inspection, review or access to such records is governed by other 
applicable law.

[50 FR 5069, Feb. 6, 1985]



Sec. 103.62  Rewards for informants.

    (a) If an individual provides original information which leads to a 
recovery of a criminal fine, civil penalty, or forfeiture, which exceeds 
$50,000, for a violation of the provisions of the Act or of this part, 
the Secretary may pay a reward to that individual.
    (b) The Secretary shall determine the amount of the reward to be 
paid under this section; however, any reward paid may not be more than 
25 percent of the net amount of the fine, penalty or forfeiture 
collected, or $150,000, whichever is less.
    (c) An officer or employee of the United States, a State, or a local 
government who provides original information described in paragraph (a) 
in the performance of official duties is not eligible for a reward under 
this section.

[50 FR 18479, May 1, 1985]



Sec. 103.63  Structured transactions.

    No person shall for the purpose of evading the reporting 
requirements of Sec. 103.22 with respect to such transaction:
    (a) Cause or attempt to cause a domestic financial institution to 
fail to file a report required under Sec. 103.22;
    (b) Cause or attempt to cause a domestic financial institution to 
file a report required under Sec. 103.22 that contains a material 
omission or misstatement of fact; or
    (c) Structure (as that term is defined in Sec. 103.11(n) of this 
part) or assist in structuring, or attempt to structure or assist in 
structuring, any transaction with one or more domestic financial 
institutions.

[52 FR 11446, Apr. 8, 1987, as amended at 54 FR 3027, Jan. 23, 1989]



Sec. 103.64  Special rules for casinos.

    (a) Compliance programs. (1) Each casino shall develop and implement 
a written program reasonably designed to assure and monitor compliance 
with the requirements set forth in 31 U.S.C. chapter 53, subchapter II 
and the regulations contained in this part.
    (2) At a minimum, each compliance program shall provide for:
    (i) A system of internal controls to assure ongoing compliance;
    (ii) Internal and/or external independent testing for compliance;
    (iii) Training of casino personnel, including training in the 
identification of unusual or suspicious transactions, to the extent that 
the reporting of such transactions is hereafter required by this part, 
by other applicable law or regulation, or by the casino's own 
administrative and compliance policies;
    (iv) An individual or individuals to assure day-to-day compliance;
    (v) Procedures for using all available information to determine:
    (A) When required by this part, the name, address, social security 
number, and other information, and verification of the same, of a 
person;
    (B) When required by this part, the occurrence of unusual or 
suspicious transactions; and
    (C) Whether any record as described in subpart C of this part must 
be made and retained; and
    (vi) For casinos that have automated data processing systems, the 
use of automated programs to aid in assuring compliance.

[[Page 356]]

    (b) Special terms. As used in this part, as applied to casinos:
    (1) Business year means the annual accounting period, such as a 
calendar or fiscal year, by which a casino maintains its books and 
records for purposes of subtitle A of title 26 of the United States 
Code.
    (2) Casino account number means any and all numbers by which a 
casino identifies a customer.
    (3) Customer includes every person which is involved in a 
transaction to which this part applies with a casino, whether or not 
that person participates, or intends to participate, in the gaming 
activities offered by that casino.
    (4) Gaming day means the normal business day of a casino. For a 
casino that offers 24 hour gaming, the term means that 24 hour period by 
which the casino keeps its books and records for business, accounting, 
and tax purposes. For purposes of the regulations contained in this 
part, each casino may have only one gaming day, common to all of its 
divisions.
    (5) Machine-readable means capable of being read by an automated 
data processing system.

[58 FR 13549, Mar. 12, 1993, as amended at 59 FR 61662, Dec. 1, 1994; 60 
FR 33725, June 29, 1995]



                           Subpart F--Summons

    Source: 52 FR 23979, June 26, 1987, unless otherwise noted. 
Redesignated at 64 FR 45451, Aug. 20, 1999.



Sec. 103.71  General.

    For any investigation for the purpose of civil enforcement of 
violations of the Currency and Foreign Transactions Reporting Act, as 
amended (31 U.S.C. 5311 through 5324), section 21 of the Federal Deposit 
Insurance Act (12 U.S.C. 1829b), section 411 of the National Housing Act 
(12 U.S.C. 1730d), or Chapter 2 of Pub. L. 91-508 (12 U.S.C. 1951 et 
seq.), or any regulation under any such provision, the Secretary or 
delegate of the Secretary may summon a financial institution or an 
officer or employee of a financial institution (including a former 
officer or employee), or any person having possession, custody, or care 
of any of the records and reports required under the Currency and 
Foreign Transactions Reporting Act or this part to appear before the 
Secretary or his delegate, at a time and place named in the summons, and 
to give testimony, under oath, and be examined, and to produce such 
books, papers, records, or other data as may be relevant or material to 
such investigation.



Sec. 103.72  Persons who may issue summons.

    For purposes of this part, the following officials are hereby 
designated as delegates of the Secretary who are authorized to issue a 
summons under Sec. 103.71, solely for the purposes of civil enforcement 
of this part:
    (a) Office of the Secretary. The Assistant Secretary (Enforcement), 
the Deputy Assistant Secretary (Law Enforcement), and the Director, 
Office of Financial Enforcement.
    (b) Internal Revenue Service. Except with respect to Sec. 103.23 of 
this part, the Commissioner, the Deputy Commissioner, the Associate 
Commissioner (Operations), the Assistant Commissioner (Examination), 
Regional Commissioners, Assistant Regional Commissioners (Examination), 
District Directors, District Examination Division Chiefs, and, for the 
purposes of perfecting seizures and forfeitures related to civil 
enforcement of this part, the Assistant Commissioner (Criminal 
Investigation), Assistant Regional Commissioners (Criminal 
Investigation), and District Criminal Investigation Division Chiefs.
    (c) Customs Service. With respect to Sec. 103.23 of this part, the 
Commissioner, the Deputy Commissioner, the Assistant Commissioner 
(Enforcement), Regional Commissioners, Assistant Regional Commissioners 
(Enforcement), and Special Agents in Charge.

[52 FR 23979, June 26, 1987. Redesignated and amended at 64 FR 45451, 
45453, Aug. 20, 1999]



Sec. 103.73  Contents of summons.

    (a) Summons for testimony. Any summons issued under Sec. 103.71 of 
this part to compel the appearance and testimony of a person shall 
state:
    (1) The name, title, address, and telephone number of the person 
before whom the appearance shall take place

[[Page 357]]

(who may be a person other than the persons who are authorized to issue 
such a summons under Sec. 103.72 of this part);
    (2) The address to which the person summoned shall report for the 
appearance;
    (3) The date and time of the appearance; and
    (4) The name, title, address, and telephone number of the person who 
has issued the summons.
    (b) Summons of books, papers, records, or data. Any summons issued 
under Sec. 103.71 of this part to require the production of books, 
papers, records, or other data shall describe the materials to be 
produced with reasonable specificity, and shall state:
    (1) The name, title, address, and telephone number of the person to 
whom the materials shall be produced (who may be a person other than the 
persons who are authorized to issue such a summons under Sec. 103.72 of 
this part);
    (2) The address at which the person summoned shall produce the 
materials, not to exceed 500 miles from any place where the financial 
institution operates or conducts business in the United States;
    (3) The specific manner of production, whether by personal delivery, 
by mail, or by messenger service;
    (4) The date and time for production; and
    (5) The name, title, address, and telephone number of the person who 
has issued the summons.

[52 FR 23979, June 26, 1987. Redesignated and amended at 64 FR 45451, 
45453, Aug. 20, 1999]



Sec. 103.74  Service of summons.

    (a) Who may serve. Any delegate of the Secretary authorized under 
Sec. 103.72 of this part to issue a summons, or any other person 
authorized by law to serve summonses or other process, is hereby 
authorized to serve a summons issued under this part.
    (b) Manner of service. Service of a summons may be made--
    (1) Upon any person, by registered mail, return receipt requested, 
directed to the person summoned;
    (2) Upon a natural person by personal delivery; or
    (3) Upon any other person by delivery to an officer, managing or 
general agent, or any other agent authorized to receive service of 
process.
    (c) Certificate of service. The summons shall contain a certificate 
of service to be signed by the server of the summons. On the hearing of 
an application for enforcement of the summons, the certificate of 
service signed by the person serving the summons shall be evidence of 
the facts it states.

[52 FR 23979, June 26, 1987. Redesignated and amended at 64 FR 45451, 
45453, Aug. 20, 1999]



Sec. 103.75  Examination of witnesses and records.

    (a) General. Any delegate of the Secretary authorized under 
Sec. 103.72 of this part to issue a summons, or any officer or employee 
of the Treasury Department or any component thereof who is designated by 
that person (whether in the summons or otherwise), is hereby authorized 
to receive evidence and to examine witnesses pursuant to the summons. 
Any person authorized by law may administer any oaths and affirmations 
that may be required under this subpart.
    (b) Testimony taken under oath. Testimony of any person under this 
part may be taken under oath, and shall be taken down in writing by the 
person examining the person summoned or shall be otherwise transcribed. 
After the testimony of a witness has been transcribed, a copy of that 
transcript shall be made available to the witness upon request, unless 
for good cause the person issuing the summons determines, under 5 U.S.C. 
555, that a copy should not be provided. If such a determination has 
been made, the witness shall be limited to inspection of the official 
transcript of the testimony.
    (c) Disclosure of summons, testimony, or records. Unless the 
Secretary or a delegate of the Secretary listed under Sec. 103.72(a) of 
this part so authorizes in writing, or it is otherwise required by law, 
no delegate of the Secretary listed under Sec. 103.72 (b) or (c) of this 
part or other officer or employee of the Treasury Department or any 
component thereof shall--
    (1) Make public the name of any person to whom a summons has been 
issued under this part, or release any information to the public 
concerning

[[Page 358]]

that person or the issuance of a summons to that person prior to the 
time and date set for that person's appearance or production of records; 
or
    (2) Disclose any testimony taken (including the name of the witness) 
or material presented pursuant to the summons, to any person other than 
an officer or employee of the Treasury Department or of any component 
thereof.

Nothing in the preceding sentence shall preclude a delegate of the 
Secretary, or other officer or employee of the Treasury Department or 
any component thereof, from disclosing testimony taken, or material 
presented pursuant to a summons issued under this part, to any person in 
order to obtain necessary information for investigative purposes 
relating to the performance of official duties, or to any officer or 
employee of the Department of Justice in connection with a possible 
violation of Federal law.

[52 FR 23979, June 26, 1987. Redesignated and amended at 64 FR 45451, 
45453, Aug. 20, 1999]



Sec. 103.76  Enforcement of summons.

    In the case of contumacy by, or refusal to obey a summons issued to, 
any person under this part, the Secretary or any delegate of the 
Secretary listed under Sec. 103.72 of this part shall refer the matter 
to the Attorney General or delegate of the Attorney General (including 
any United States Attorney or Assistant United States Attorney, as 
appropriate), who may bring an action to compel compliance with the 
summons in any court of the United States within the jurisdiction of 
which the investigation which gave rise to the summons being or has been 
carried on, the jurisdiction in which the person summoned is a resident, 
or the jurisdiction in which the person summoned carries on business or 
may be found. When a referral is made by a delegate of the Secretary 
other than a delegate named in Sec. 103.72(a) of this part, prompt 
notification of the referral must be made to the Director, Office of 
Financial Enforcement, Office of the Assistant Secretary (Enforcement). 
The court may issue an order requiring the person summoned to appear 
before the Secretary or delegate of the Secretary to produce books, 
papers, records, or other data, to give testimony as may be necessary in 
order to explain how such material was compiled and maintained, and to 
pay the costs of the proceeding. Any failure to obey the order of the 
court may be punished by the court as a contempt thereof. All process in 
any case under this section may be served in any judicial district in 
which such person may be found.

[52 FR 23979, June 26, 1987. Redesignated and amended at 64 FR 45451, 
45453, Aug. 20, 1999]



Sec. 103.77  Payment of expenses.

    Persons summoned under this part shall be paid the same fees and 
mileage for travel in the United States that are paid witnesses in the 
courts of the United States. The United States shall not be liable for 
any other expense incurred in connection with the production of books, 
papers, records, or other data under this part.



                    Subpart G--Administrative Rulings

    Source: 52 FR 35546, Sept. 22, 1987, unless otherwise noted. 
Redesignated at 64 FR 45451, Aug. 20, 1999.



Sec. 103.80  Scope.

    This subpart provides that the Assistant Secretary (Enforcement), or 
his designee, either unilaterally or upon request, may issue 
administrative rulings interpreting the application of part 103.



Sec. 103.81  Submitting requests.

    (a) Each request for an administrative ruling must be in writing and 
contain the following information:
    (1) A complete description of the situation for which the ruling is 
requested,
    (2) A complete statement of all material facts related to the 
subject transaction,
    (3) A concise and unambiguous question to be answered,
    (4) A statement certifying, to the best of the requestor's knowledge 
and belief, that the question to be answered is not applicable to any 
ongoing state or federal investigation, litigation, grand jury 
proceeding, or proceeding before any other governmental body involving 
either the requestor, any other party to the subject transaction, or

[[Page 359]]

any other party with whom the requestor has an agency relationship,
    (5) A statement identifying any information in the request that the 
requestor considers to be exempt from disclosure under the Freedom of 
Information Act, 5 U.S.C. 552, and the reason therefor,
    (6) If the subject situation is hypothetical, a statement justifying 
why the particular situation described warrants the issuance of a 
ruling,
    (7) The signature of the person making the request, or
    (8) If an agent makes the request, the signature of the agent and a 
statement certifying the authority under which the request is made.
    (b) A request filed by a corporation shall be signed by a corporate 
officer and a request filed by a partnership shall be signed by a 
partner.
    (c) A request may advocate a particular proposed interpretation and 
may set forth the legal and factual basis for that interpretation.
    (d) Requests shall be addressed to: Director, Office of Financial 
Enforcement, Office of the Assistant Secretary (Enforcement), U.S. 
Department of the Treasury, 1500 Pennsylvania Avenue NW., Room 4320, 
Washington, DC 20220.
    (e) The requester shall advise the Director, Office of Financial 
Enforcement, immediately in writing of any subsequent change in any 
material fact or statement submitted with a ruling request in conformity 
with paragraph (a) of this section.

(Approved by the Office of Management and Budget under control number 
1505-0105)



Sec. 103.82  Nonconforming requests.

    The Director, Office of Financial Enforcement, shall notify the 
requester if the ruling request does not conform with the requirements 
of Sec. 103.81. The notice shall be in writing and shall describe the 
requirements that have not been met. A request that is not brought into 
conformity with such requirements within 30 days from the date of such 
notice, unless extended for good cause by the Office of Financial 
Enforcement, shall be treated as though it were withdrawn.

(Approved by the Office of Management and Budget under control number 
1505-0105)

[52 FR 23979, June 26, 1987. Redesignated and amended at 64 FR 45451, 
45453, Aug. 20, 1999]



Sec. 103.83  Oral communications.

    (a) The Office of the Assistant Secretary (Enforcement) will not 
issue administrative rulings in response to oral requests. Oral opinions 
or advice by Treasury, the Customs Service, the Internal Revenue 
Service, the Office of the Comptroller of the Currency, or any other 
bank supervisory agency personnel, regarding the interpretation and 
application of this part, do not bind the Treasury Department and carry 
no precedential value.
    (b) A person who has made a ruling request in conformity with 
Sec. 103.81 may request an opportunity for oral discussion of the issues 
presented in the request. The request should be made to the Director, 
Office of Financial Enforcement, and any decision to grant such a 
conference is wholly within the discretion of the Director. Personal 
conferences or telephone conferences may be scheduled only for the 
purpose of affording the requester an opportunity to discuss freely and 
openly the matters set forth in the administrative ruling request. 
Accordingly, the conferees will not be bound by any argument or position 
advocated or agreed to, expressly or impliedly, during the conference. 
Any new arguments or facts put forth by the requester at the meeting 
must be reduced to writing by the requester and submitted in conformity 
with Sec. 103.81 before they may be considered in connection with the 
request.

(Approved by the Office of Management and Budget under control number 
1505-0105)

[52 FR 23979, June 26, 1987. Redesignated and amended at 64 FR 45451, 
45453, Aug. 20, 1999]



Sec. 103.84  Withdrawing requests.

    A person may withdraw a request for an administrative ruling at any 
time before the ruling has been issued.

[[Page 360]]



Sec. 103.85  Issuing rulings.

    The Assistant Secretary (Enforcement), or his designee may issue a 
written ruling interpreting the relationship between part 103 and each 
situation for which such a ruling has been requested in conformity with 
Sec. 103.81. A ruling issued under this section shall bind the Treasury 
Department only in the event that the request describes a specifically 
identified actual situation. A ruling issued under this section shall 
have precedential value, and hence may be relied upon by others 
similarly situated, only if it is published or will be published by the 
Office of Financial Enforcement in the Federal Register. Rulings with 
precedential value will be published periodically in the Federal 
Register and yearly in the Appendix to this part. All rulings with 
precedential value will be available by mail to any person upon written 
request specifically identifying the ruling sought. Treasury will make 
every effort to respond to each requestor within 90 days of receiving a 
request.

(Approved by the Office of Management and Budget under control number 
1505-0105)

[52 FR 23979, June 26, 1987. Redesignated and amended at 64 FR 45451, 
45453, Aug. 20, 1999]



Sec. 103.86  Modifying or rescinding rulings.

    (a) The Assistant Secretary (Enforcement), or his designee may 
modify or rescind any ruling made pursuant to Sec. 103.85:
    (1) When, in light of changes in the statute or regulations, the 
ruling no longer sets forth the interpretation of the Assistant 
Secretary (Enforcement) with respect to the described situation,
    (2) When any fact or statement submitted in the original ruling 
request is found to be materially inaccurate or incomplete, or
    (3) For other good cause.
    (b) Any person may submit to the Assistant Secretary (Enforcement) a 
written request that an administrative ruling be modified or rescinded. 
The request should conform to the requirements of Sec. 103.81, explain 
why rescission or modification is warranted, and refer to any reasons in 
paragraph (a) of this section that are relevant. The request may 
advocate an alternative interpretation and may set forth the legal and 
factual basis for that interpretation.
    (c) Treasury shall modify an existing administrative ruling by 
issuing a new ruling that rescinds the relevant prior ruling. Once 
rescinded, an administrative ruling shall no longer have any 
precedential value.
    (d) An administrative ruling may be modified or rescinded 
retroactively with respect to one or more parties to the original ruling 
request if the Assistant Secretary determines that:
    (1) A fact or statement in the original ruling request was 
materially inaccurate or incomplete,
    (2) The requestor failed to notify in writing the Office of 
Enforcement of a material change to any fact or statement in the 
original request, or
    (3) A party to the original request acted in bad faith when relying 
upon the ruling.

(Approved by the Office of Management and Budget under control number 
1505-0105)

[52 FR 23979, June 26, 1987. Redesignated and amended at 64 FR 45451, 
45453, Aug. 20, 1999]



Sec. 103.87  Disclosing information.

    (a) Any part of any administrative ruling, including names, 
addresses, or information related to the business transactions of 
private parties, may be disclosed pursuant to a request under the 
Freedom of Information Act, 5 U.S.C. 552. If the request for an 
administrative ruling contains information which the requestor wishes to 
be considered for exemption from disclosure under the Freedom of 
Information Act, the requestor should clearly identify such portions of 
the request and the reasons why such information should be exempt from 
disclosure.
    (b) A requestor claiming an exemption from disclosure will be 
notified, at least 10 days before the administrative ruling is issued, 
of a decision not to exempt any of such information from disclosure so 
that the underlying request for an administrative ruling can be 
withdrawn if the requestor so chooses.

(Approved by the Office of Management and Budget under control number 
1505-0105)

[[Page 361]]

              Appendix to Part 103--Administrative Rulings

                          88-1 (June 22, 1988)

                                  Issue

    What action should a financial institution take when it believes 
that it is being misused by persons who are intentionally structuring 
transactions to evade the reporting requirement or engaging in 
transactions that may involve illegal activity such as drug trafficking, 
tax evasion or money laundering?

                                  Facts

    A teller at X State Bank notices that the same person comes into the 
bank each day and purchases, with cash, between $9,000 and $9,900 in 
cashier's checks. Even when aggregated, these purchases never exceed 
$10,000 during any one business day. The teller also notices that this 
person tries to go to different tellers for each transaction and is very 
reluctant to provide information about his frequent transactions or 
other information such as name, address, etc. Likewise, the payees on 
these cashier's checks all have common names such as ``John Smith'' or 
``Mary Jones.'' The teller informs the bank's compliance officer that 
she believes that this person is structuring his transactions in order 
to evade the reporting requirements under the Bank Secrecy Act. X State 
Bank wants to know what actions it should take in this situation or in 
any other situation where a transaction or a person conducting a 
transaction appears suspicious.

                            Law and Analysis

    As it appears that the person may be intentionally structuring the 
transactions to evade the Bank Secrecy Act reporting requirements, X 
State Bank should immediately telephone the local office of the Internal 
Revenue Service (``IRS'') and speak to a Special Agent in the IRS 
Criminal Investigation Division, or should call 1-800-BSA-CTRS, where 
his call will be referred to a Special Agent.
    Any information provided to the IRS should be given within the 
confines of Sec. 1103(c) of the Right to Financial Privacy Act. 12 
U.S.C. 3401-3422. Section 1103(c) of that Act permits a financial 
instituiton to notify a government authority of information relevant to 
a possible violation of any statute or regulation. Such information may 
consist of the names of any individuals or corporate entities involved 
in the suspicious transactions; account numbers; home and business 
addresses; social security numbers; type of account; interest paid on 
account; location of the branch or office where the suspicious 
transaction occurred; a specification of the offense that the financial 
institution believes has been committed; and a description of the 
activities giving rise to the bank's suspicion. S. Rep. 99-433, 99th 
Cong., 2d Sess., pp. 15-16.
    Additionally, the bank may be required, by the Federal regulatory 
agency which supervises it, to submit a criminal referral form. Thus, 
the bank should check with its regulatory agency to determine whether a 
referral form should be submitted.
    Lastly, under the facts as described above, X State Bank is not 
required to file a Currency Transaction Report (``CTR'') because the 
currency transaction (i.e. purchase of cashier's checks) did not exceed 
$10,000 during one business day. If the bank had found that on a 
particular day the person had in fact used a total of more than $10,000 
in currency to purchase cashier's checks, but had each individual 
cashier's check made out in amounts of less than $10,000, the bank is 
obligated to file a CTR, and should follow the other steps described 
above.

                                 Holding

    If X State Bank notices that a person may be misusing it by 
intentionally structuring transactions to evade the BSA reporting 
requirements or engaging in transactions that may involve other illegal 
activity, the bank should telephone the local office of the Internal 
Revenue Service, Criminal Investigation Division, and report that 
information to a Special Agent, or should call 1-800-BSA-CTRS. In 
addition, the Federal regulatory agency which supervises X State Bank 
may require the bank to submit a criminal referral form. All disclosures 
to the Government should be made in accordance with the provisions of 
the Right to Financial Privacy Act.

                          88-2 (June 22, 1988)

                                  Issue

    When, if ever, should a bank file a CMIR on behalf of its customer, 
when the customer is importing or exporting more than $10,000 in 
currency or monetary instruments?

                                  Facts

    A customer walks into B National Bank (``B'') with $15,000 in cash 
for deposit into her account. As is required, the bank teller begins to 
fill out a Currency Transaction Report (``CTR'', IRS Form 4789) in order 
to report a transaction in currency of more than $10,000. While the 
teller is filling out the CTR, the customer mentions to the teller that 
she has just received the money in a letter from a relative in France. 
Should the teller also file a CMIR, either on the customer's behalf or 
on the bank's behalf?

                            Law and Analysis

    B National Bank should not file a CMIR when a customer deposits 
currency in excess

[[Page 362]]

of $10,000 into her account, even if the bank has knowledge that the 
customer received the currency from a place outside the United States. 
31 CFR 103.23 requires that a CMIR be filed by anyone who transports, 
mails, ships or receives, or attempts, causes or attempts to cause the 
transportation, mailing, shipping or receiving of currency or monetary 
instruments in excess of $10,000, from or to a place outside the United 
States. The term ``monetary instruments'' includes currency and 
instruments such as negotiable instruments endorsed without restriction. 
See 31 CFR 103.11(k).
    The obligation to file the CMIR is solely on the person who 
transports, mails, ships or receives, or causes or attempts to 
transport, mail, ship or receive. No other person is under any 
obligation to file a CMIR. Thus, if a customer walks into the bank and 
declares that he or she has received or transported currency in an 
aggregate amount exceeding $10,000 from a place outside the United 
States and wishes to deposit the currency into his or her account, the 
bank is under no obligation to file a CMIR on the customer's behalf. 
Likewise, because the bank itself did not receive the money from a 
customer outside the United States, it has no obligation to file a CMIR 
on its own behalf. The same holds true if a customer declares his intent 
to transport currency or monetary instruments in excess of $10,000 to a 
place outside the United States.
    However, the bank is strongly encouraged to inform the customer of 
the CMIR reporting requirement. If the bank has knowledge that the 
customer is aware of the CMIR reporting requirement, but is nevertheless 
disregarding the requirement or if information about the transaction is 
otherwise suspicious, the bank should contact the local office of the 
U.S. Customs Service or 1-800-BE ALERT. The United States Customs 
Service has been delegated authority by the Assistant Secretary 
(Enforcement) to investigate criminal violations of 31 CFR 103.23. See 
31 CFR 103.36(c)(1).
    Any information provided to Customs should be given within the 
confines of section 1103(c) of the Right to Financial Privacy Act, 12 
U.S.C. 3401-3422. Section 1103(c) permits a financial institution to 
notify a Government authority of information relevant to a possible 
violation of any statute or regulation. Such information may consist of 
the name (including those of corporate entities) of any individual 
involved in the suspicious transaction; account numbers; home and 
business addresses; social security numbers; type of account; interest 
paid on account; location of branch where the suspicious transaction 
occurred; a specification of the offense that the financial institution 
believes has been committed; and a description of the activities giving 
rise to the bank's suspicions. See S. Rep. 99-433, 99th Cong., 2nd 
Sess., pp. 15-16. Therefore, under the facts above, the teller need only 
file a CTR for the deposit of the customer's $15,000 in currency.
    A previous interpretation of Sec. 103.23(b) by Treasury held that if 
a bank received currency or monetary instruments over the counter from a 
person who may have transported them into the United States, and knows 
that such items have been transported into the country, it must file a 
report on Form 4790 if a complete and truthful report has not been filed 
by the customer. See 31 CFR 103 appendix, Sec. 103.23, interpretation 2, 
at 364 (1987). This ruling hereby supersedes that interpretation.

                                 Holding

    A bank should not file a CMIR when a customer deposits currency or 
monetary instruments in excess of $10,000 into her account even if the 
bank has knowledge that the currency or monetary instruments were 
received or transported from a place outside the United States. 31 CFR 
103.23. The same is true if the bank has knowledge that the customer 
intends to transport the currency or monetary instruments to a place 
outside the United States. However, the bank is required to file a CTR 
if it receives in excess of $10,000 in cash from its customer, and is 
strongly encouraged to inform the customer of the CMIR requirements. In 
addition, if the bank has knowledge that the customer is aware of the 
CMIR reporting requirement and is nevertheless planning to disregard it 
or if the transaction is otherwise suspicious, the bank should notify 
the local office of the United States Customs Service (or 1-800-Be 
Alert) of the suspicious transaction. Such notice should be made within 
the confines of the Right to Financial Privacy Act, 12 U.S.C. 3403(c).

                          88-3 (June 22, 1988)

                                  Issue

    Whether a bank may exempt ``cash-back'' transactions of a customer 
whose primary business is of a type that may be exempted either 
unilaterally by the bank or pursuant to additional authority granted by 
the IRS.

                                  Facts

    The ABC Grocery (``ABC''), a retail grocery store, has an account at 
the X State Bank for its daily deposits of currency. Because ABC 
regularly and frequently deposits amounts ranging from $20,000 to 
$30,000, the bank has properly granted ABC an exemption for daily 
deposits up to a limit of $30,000.
    Recently, ABC began providing its customers with a check-cashing 
service as an adjunct to its primary business of selling groceries. 
ABC's primary business still consists of the sale of groceries. However, 
the

[[Page 363]]

unexpectedly heavy demand for ABC's check-cashing service has required 
ABC to maintain a substantially greater quantity of cash in the store 
than was necessary for the grocery business in the past. To facilitate 
the operations of its check-cashing service, ABC is presenting the bank 
with large numbers of checks in ``cash-back'' transactions, rather than 
depositing the checks into its account and withdrawing cash from that 
account. X State Bank has just been presented with a ``cash-back'' 
transaction wherein an employee of ABC is exchanging $15,000 worth of 
checks for cash. How should the bank treat this transaction?

                            Law and Analysis

    A cash back transaction is one where one or more checks or other 
monetary instruments are presented in exchange for cash or a portion of 
the checks or monetary instruments are deposited while the remainder is 
exchanged for cash. ``Cash back'' transactions can never be exempted 
from the Bank Secrecy Act reporting requirements. Thus, the bank must 
file a Currency Transaction Report on IRS Form 4789 reporting this 
$15,000 ``cash back'' transaction, even though the customer's account 
has been granted an exemption for daily deposits of up to $30,000. This 
is because Sec. 103.22(b)(i) permits a bank to exempt only ``(d)eposits 
or withdrawals of currency from an existing account by an established 
depositor who is a United States resident and operates a retail type of 
business in the United States'' (emphasis added). As ``cash-back'' 
transactions do not constitute either a ``deposit or withdrawal of 
currency'' within the meaning of the regulations, the bank must report 
on a CTR any ``cash-back'' transaction that results in the transfer of 
more than $10,000 in currency to a customer during a single banking day, 
regardless of whether the customer has properly been granted an 
exemption for its deposits or withdrawals.
    Moreover, because ``cash back'' transactions are never exemptible, 
the bank may not unilaterally exempt ``cash-back'' transactions by ABC, 
or seek additional authority from the IRS to grant a special exemption 
for ABC's ``cash-back'' transactions. Instead, the bank must report 
ABC's ``cash back'' transaction on a CTR, listing it as a $15,000 
``check cashed'' transaction.

                                 Holding

    A bank may never grant a unilateral exemption, or obtain additional 
authority from the IRS to grant a special exemption to the ``cash-back'' 
transactions of a customer. A ``cash back'' transaction is one where one 
or more checks or other monetary instruments are presented in exchange 
for cash or a portion of the checks or monetary instruments are 
deposited while the remainder is exchanged for cash. If a bank handles a 
``cash-back'' transaction that results in the transfer of more than 
$10,000 to a customer during a single banking day, it must report that 
transaction on IRS Form 4789, the Currency Transaction Report, as a 
``check cashed'' transaction, regardless of whether the customer has 
been properly granted an exemption for daily deposits or withdrawals.

                          88-4 (August 2, 1988)

                                  Issue

    If a bank has exempted a single account of a customer into which 
multiple establishments of that customer make deposits, must the bank 
list all of the establishments on its exemption list or may the bank 
list only the Sec. 103.22(f) information of the customer's headquarters 
or its principal business establishment on its exemption list?

                                  Facts

    A fast food company operates a chain of fast-food restaurants in 
several states. In New York, the company has established a single 
deposit account at Bank A, into which all of the company's 
establishments in that area make deposits. In Connecticut, the company 
has established ten bank accounts at Bank B; each of the company's ten 
establishments in Connecticut have been assigned a separate account into 
which it makes deposits. Banks A and B have properly exempted the 
company's accounts, but now seek guidance on the manner in which they 
should add these accounts to their exemption lists. All of the company's 
establishments use the same taxpayer identification number (``TIN'').

                            Law and Analysis

    Under the regulations, the bank must keep ``in a centralized list,'' 
Sec. 103.22(f) information for ``each depositor that has engaged in 
currency transactions which have not been reported because of (an) 
exemption * * *'' However, where all of the company's establishments 
deposit into one exempt account as at Bank A, above, the bank need only 
maintain Sec. 103.22(f) information on its list for the customer's 
corporate headquarters or the principal establishment that obtained the 
exemption. The bank may, but is not required to, list identifying 
information for all of the customers' establishments depositing into the 
one account. If the bank chooses to list only the information for the 
customer's headquarters or principal establishment, it should briefly 
note that on the exemption list and should ensure that the individual 
addresses for each establishment are readily available upon request. 
Where each of the company's establishments deposit into separate exempt 
accounts as at Bank B, the bank

[[Page 364]]

must maintain separate Sec. 103.22(f) information on the exemption list 
for each establishment.
    Under Sec. 103.22(b)(2) (i), (ii), and (iv) and Sec. 103.22(e) of 
the regulation, a bank can only grant an exemption for ``an existing 
account (of) an established depositor who is a United States resident.'' 
Under these provisions, therefore, the bank can only grant an exemption 
for an existing individual account, not for an individual customer or 
group of accounts. Thus, if a customer has a separate account for each 
of its business establishments, the bank must consider each account for 
a separate exemption. If the bank grants exemptions for more than one 
account, it should prepare a separate exemption statement and establish 
a separate dollar limit for each account.
    Once an exemption has been granted for an account, Sec. 103.22(f) 
requires the bank to maintain a centralized exemption list that includes 
the name, address, business, types of transactions exempted, the dollar 
limit of the exemption, taxpayer identification number, and account 
number of the customers whose accounts have been exempted.

                                 Holding

    Under 31 CFR 103.22, when a bank has exempted a single account of a 
customer into which more than one of the customer's establishments make 
deposits, the bank may include the name, address, business, type of 
transactions exempted, the dollar limit of the exemption, taxpayer 
identification number, and account number (``Sec. 103.22(f) 
information'') of either the customer's headquarters or the principal 
business establishment, or it may separately list Sec. 103.22(f) 
information for each of the establishments using that account. If the 
bank chooses to list only the information for the customer's 
headquarters or principal establishment, it should briefly note that 
fact on the exemption list, and it should ensure that the individual 
addresses of those establishments not on the list are readily available 
upon request. If a bank has granted separate exemptions to several 
accounts, each of which is used by a single establishment of the same 
customer, the bank must include on its exemption list Sec. 103.22(f) 
information for each of those establishments. Previous Treasury 
correspondence or interpretations contrary to this policy are hereby 
rescinded.

                          88-5 (August 2, 1988)

                                  Issue

    Does a financial institution have a duty to file a CTR on currency 
transactions where the financial institution never physically receives 
the cash because it uses an armored car service to collect, transport 
and process its customer's cash receipts?

                                  Facts

    X State Bank (the ``Bank'') and Acme Armored Car Service (``Acme'') 
have entered into a contract which provides for Acme to collect, 
transport and process revenues received from Bank customers:
    Each day, Acme picks up cash, checks, and deposit tickets from 
Little Z, a non-exempt customer of the Bank. Recently, receipts of cash 
from Little Z have exceeded $10,000. Acme delivers the checks and 
deposit tickets to the Bank where they are processed and Little Z's 
account is credited. All cash collected, however, is taken by Acme to 
its central office where it is counted and processed. The cash is then 
delivered by Acme to the Federal Reserve Bank for deposit into the 
Bank's account. Must the Bank file a CTR to report a receipt of cash in 
excess of $10,000 by Acme from Little Z?

                            Law and Anaylsis

    Yes. Since Acme is receiving cash in excess of $10,000 on behalf of 
the Bank, the Bank must file a CTR in order to report these 
transactions.
    Section 103.22(a)(1) requires ``(e)ach financial institution * * * 
[to] file a report of each deposit, withdrawal, exchange of currency or 
other payment or transfer, by, through or to such financial institution 
which involves a transaction in currency of more than $10,000.'' Section 
103.11 (a) and (g) defines ``Bank'' and ``Financial Institution'' to 
include agents of those banks and financial institutions.
    Under the facts presented, Acme is acting as an agent of the Bank. 
This is because Acme and the Bank have a contractual relationship 
whereby the Bank has authorized Acme to pick up, transport and process 
Little Z's receipts on behalf of the Bank. The Federal Reserve Bank's 
acceptance of deposits from Acme into the Bank's account at the Fed, is 
additional evidence of the agency relationship between the Bank and 
Acme.
    Therefore, when Acme receives currency in excess of $10,000 from 
Little Z, the Bank must report that transaction on Form 4789. Likewise, 
if Acme receives currency from Little Z in multiple transactions, 
Sec. 103.22(a)(1) requires the Bank to aggregate these transactions and 
file a single CTR for the total amount of currency received by Acme, if 
the Bank has knowledge of these multiple transactions. Knowledge by the 
Bank's agent, i.e., Acme, that the currency was received in multiple 
transactions, is attributable to the Bank. The Bank must assure that 
Acme, as its agent, obtains all the information and identification 
necessary to complete the CTR.

                                 Holding

    Financial institutions must file a CTR for the currency received by 
an armored car

[[Page 365]]

service from the financial institution's customer when the armored car 
service physically receives the cash from the customer, transports it 
and processes the receipts, even though the currency may never 
physically be received by the financial institution. This is because the 
armored car service is acting as an agent of the financial institution.

                         89-1 (January 12, 1989)

                                  Issue

    Under Sec. 103.22 of the BSA regulations, may a bank unilaterally 
grant one exemption or establish a single dollar exemption limit for a 
group of existing accounts of the same customer? If not, may a bank 
obtain additional authority from the IRS to grant a single exemption for 
a group of exemptible accounts belonging to the same customer?

                                  Facts

    ABC Inc. (``ABC''), with TIN 12-3456789, owns five fast food 
restaurants. Each restaurant has its own account at the X State Bank and 
each restaurant routinely deposits less than $10,000 into its individual 
account. However, when the deposits into these five accounts are 
aggregated they regularly and frequently exceed $10,000. Accordingly, 
the bank prepares and files one CTR for ABC Inc., on each business day 
that ABC's aggregated currency transactions exceed $10,000. X State Bank 
wants to know whether it can unilaterally exempt these five accounts 
having the same TIN, and, if not, whether it can obtain additional 
authority from the IRS to grant a single exemption to the group of five 
accounts belonging to ABC.

                            Law and Analysis

    Under Sec. 103.22(b)(2) (i) and (ii) of the Bank Secrecy Act 
(``BSA'') regulations, 31 CFR part 103, only an individual account of a 
customer may be unilaterally exempted from the currency transaction 
reporting provisions. The bank may not unilaterally grant one exemption 
or establish a single dollar exemption limit for multiple accounts of 
the same customer. This is because Secs. 103.22(b)(2)(i) and 
103.22(b)(2)(ii) of the BSA regulations only permit a bank to 
unilaterally exempt ``[d]eposits or withdrawals of currency from an 
existing account by an established depositor who is a United States 
resident and operates a retail type of business in the United States.'' 
31 CFR 103.22(b)(2) (i) and (ii).
    Section 103.22(e) of the BSA regulations provides, however, that 
``[a] bank may apply to the * * * [IRS] for additional authority to 
grant exemptions to the reporting requirements not otherwise permitted 
under paragraph (b) of this section * * *'' 31 CFR 103.22(e). Therefore, 
under this authority, and at the request of a bank, the IRS may, in its 
discretion, grant the requesting bank additional authority to exempt a 
group of accounts when the following conditions are met:
    (1) Each of the accounts in the group is owned by the same person 
and has the same taxpayer identification number.
    (2) The deposits or withdrawals into each account are made by a 
customer that operates a business that may be either unilaterally or 
specially exemptible and each account meets the other exemption criteria 
(except for the dollar amount).
    (3) Currency transactions for each account individually do not 
exceed $10,000 on a regular and frequent basis.
    (4) Aggregated currency transactions for all accounts included in 
the group regularly and frequently exceed $10,000.
    If a bank determines that an exemption would be appropriate in a 
situation involving a group of accounts belonging to a single customer, 
it must apply to the IRS for authority to grant one special exemption 
covering the accounts in question. As with all requests for special 
exemptions, any request for additional authority to grant a special 
exemption must be made in writing and accompanied by a statement of the 
circumstances that warrant special exemption treatment and a copy of the 
statement signed by the customer as required by Sec. 103.22(d). 31 CFR 
103.22(d).
    Additional authority to grant a special exemption for a group of 
accounts must be obtained from the IRS regardless of whether the 
businesses may be unilaterally exempted under Sec. 103.22(b)(2), because 
the exemption, if granted, would apply to a group of existing accounts 
as opposed to an individual existing account. 31 CFR 103.22(b)(2).
    Also, if any one of a given customer's accounts has regular and 
frequent currency transactions which exceed $10,000, that account may 
not be included in the group exemption. This is because the bank may, as 
provided by Sec. 103.22(b)(2), either unilaterally exempt that account 
or obtain authority from the IRS to grant a special exemption for that 
account if it meets the other criteria for exemption. Thus, only 
accounts of exemptible businesses which do not have regular and frequent 
(e.g., daily, weekly or twice a month) currency transactions in excess 
of $10,000 may be eligible for a group exemption.
    The intention of this special exemption is to permit banks to exempt 
the accounts of established customers, such as the ABC Inc. restaurants 
described above, which are owned by the same person and have the same 
TIN but which individually do not have sufficient currency deposit or 
withdrawal activity that regularly and frequently exceed $10,000.

[[Page 366]]

                                 Holding

    If X State Bank determines that an exemption would be appropriate 
for ABC Inc., it must apply to the IRS for authority to grant one 
special exemption covering ABC's five separate accounts. As with all 
requests for special exemptions, ABC's request for additional authority 
to grant a special exemption must be made in writing and accompanied by 
a statement of the circumstances that warrant special exemption 
treatment and a copy of the statement signed by the customer as required 
by Sec. 103.22(d). 31 CFR 103.22(d). The IRS may, in its discretion, 
grant additional authority to exempt the ABC accounts if: (1) They have 
the same taxpayer identification number; (2) they each are for customers 
that operate a business that may be either unilaterally or specially 
exemptible and each account meets the other exemption criteria (except 
for dollar amount); (3) the currency transactions for each account 
individually do not exceed $10,000 on a regular and frequent basis; but 
(4) when aggregated the currency transactions for all the accounts 
regularly and frequently do exceed $10,000.

                          89-2 (June 21, 1989)

                                  Issue

    When a customer has established bank accounts for each of several 
establishments that it owns, and the bank has exempted one or more of 
those accounts, how does the bank aggregate the customer's currency 
transactions?

                                  Facts

    X Company (``X'') operates two fast-food restaurants and a wholesale 
food business. X has opened separate bank accounts at the A National 
Bank (the ``Bank'') for each of its two restaurants, account numbers 1 
and 2 respectively. Each of these two accounts has been properly 
exempted by the bank. Account number 1 has an exemption limit of $25,000 
for deposits, and account number 2 has an exemption limit of $40,000 for 
deposits. X also has a third account, account number 3, at the bank for 
use in the operation of its wholesale food business. On occasion, cash 
deposits of more than $10,000 are made into this third account. Because 
these cash deposits are infrequent, the bank cannot obtain additional 
authority to grant this account a special exemption.
    During the same business day, two $15,000 cash deposits totalling 
$30,000 are made into account number 1, a separate cash deposit of 
$35,000 is made into account number 2 and a deposit of $9,000 in 
currency is made into account number 3 (X's account for its wholesale 
food business).
    The bank must now determine how to aggregate and report all of these 
transactions on a Form 4789, Currency Transaction Report, (``CTR''). 
Must they aggregate all of the deposits made into account numbers 1, 2 
and 3 and report them on a single CTR?

                            Law and Analysis

    Section 103.22 of the Bank Secrecy Act (``BSA''), 31 CFR part 103, 
requires a financial institution to treat multiple currency transactions 
``as a single transaction if the financial institution has knowledge 
that they are by or on behalf of any person and result in either cash-in 
or cash-out totalling more than $10,000 during any one business day.'' 
This means that a financial institution must file a CTR if it knows that 
multiple currency transactions involving two or more accounts have been 
conducted by or on behalf of the same person and, those transactions, 
when aggregated, exceed $10,000. Knowledge, in this context, means 
knowledge on the part of a partner, director, officer or employee of the 
institution or on the part of any existing computer or manual system at 
the institution that permits it to aggregate transactions.
    Thus, if the bank has knowledge of multiple transactions, the bank 
should aggregate the transactions in the following manner.
    First, the bank should separately review and total all cash-in and 
cash-out transactions within each account. Cash-in transactions should 
be aggregated with other cash-in transactions and cash-out transactions 
should be aggregated with cash-out transactions. Cash-in and cash-out 
transactions should not be aggregated together or offset against each 
other.
    Second, the bank should determine whether the account has an 
exemption limit. If the account has an exemption limit, the bank should 
determine whether it has been exceeded. If the exemption limit has not 
been exceeded, the transactions for the exempted account should not be 
aggregated with other transactions.
    If the total transactions during the same business day for a 
particular account exceed the exemption limit, the total of all of the 
transactions for that account should be aggregated with the total amount 
of the transactions for other accounts that exceed their respective 
exemption limits, with any accounts without exemption limits, and with 
transactions conducted by or on behalf of the same person that do not 
involve accounts (e.g., purchases of bank checks with cash) of which the 
bank has knowledge.
    In the example discussed above, all of the transactions have been 
conducted ``on behalf of'' X, as X owns the restaurants and the 
wholesale food business. The total $30,000 deposit for account 1 exceeds 
the $25,000 exemption limit for that account. The $35,000 deposit into 
account number 2 is less than the

[[Page 367]]

$40,000 exemption limit for that account. Finally, the $9,000 deposit 
into account number 3, does not by itself constitute a reportable 
transaction.
    Therefore, under the facts above, the bank should aggregate the 
entire $30,000 deposit into account number 1 (not just the amount that 
exceeds the exemption limit), with the $9,000 deposit into account 
number 3, for a total of $39,000. The bank should not include the 
$35,000 deposit into account number 2, as that deposit does not exceed 
the exemption limit for that account. Accordingly, the bank should 
complete and file a single CTR for $39,000.
    If the bank does not have knowledge that multiple currency 
transactions have been conducted in these accounts on the same business 
day (e.g., because it does not have a system that aggregates among 
accounts and the deposits were made by three different individuals at 
different times) the bank should file one CTR for $30,000 for account 
number 1, as the activity into that account exceeds its exemption limit.

                                 Holding

    When a customer has more than one account and a bank employee has 
knowledge that multiple currency transaction have been conducted in the 
accounts or the bank has an existing computer or manual system that 
permits it to aggregate transactions for multiple accounts, the bank 
should aggregate the transactions in the following manner.
    First, the bank should aggregate for each account all cash-in or 
cash-out transactions conducted during one business day. If the account 
has an exemption limit, the bank should determine whether the exemption 
limit of that account has been exceeded. If the exemption limit has not 
been exceeded, the total of the transactions for that particular account 
does not have to be aggregated with other transactions. If the total 
transactions during the same business day for a particular account 
exceed the exemption limit, however, the total of all of the 
transactions for that account should be aggregated with any total from 
other accounts that exceed their respective exemption limits, with any 
accounts without exemption limits, and with any reportable transactions 
conducted by or on behalf of the customer not involving accounts (e.g., 
purchases of bank checks or ``cash back'' transactions) of which the 
bank has knowledge. The bank should then file a CTR for the aggregated 
amount.

                        89-5  (December 21, 1989)

                                  Issue

    How does a financial institution fulfill the requirement that it 
furnish information about the person on whose behalf a reportable 
currency transaction is being conducted?

                                  Facts

    No. 1. Linda Scott has had an account relationship with the Bank for 
15 years. Ms. Scott enters the bank and deposits $15,000 in cash into 
her personal checking account. The bank knows that Ms. Scott is an 
artist who on occasions exhibits and sells her art work and that her art 
work currently is on exhibit at the local gallery. The bank further 
knows that cash deposits in the amount of $15,000 are commensurate with 
Ms. Scott's art sales.
    No. 2. Dick Wallace has recently opened a personal account at the 
Bank. Although the bank verified his identity when the account was 
opened, the bank has no additional information about Mr. Wallace. Mr. 
Wallace enters the bank with $18,000 in currency and asks that it be 
wire transferred to a bank in a foreign country.
    No. 3. Dorothy Green, a partner at a law firm, makes a $50,000 cash 
deposit into the firm's trust account.\1\ The bank knows that this is a 
trust account. The $50,000 represents cash received from three clients.
---------------------------------------------------------------------------

    \1\ This type of account is sometimes called a trust account, 
attorney account or special account. It is an account established by an 
attorney into which commingled funds of clients may be deposited. It is 
not necessarily a ``trust'' in the legal sense of the term.
---------------------------------------------------------------------------

    No. 4. Carlos Gomez enters a Currency Dealer and asks to buy $12,000 
in traveler's checks with cash.
    No. 5. Gail Julian, a trusted employee of Q-mart, a large retail 
chain, enters the bank three times during one business day and makes 
three large cash deposits totalling $48,000 into Q-mart's account. The 
Bank knows that Ms. Julian is responsible for making the deposits on 
behalf of Q-mart. Q-mart has an exemption limit of $45,000.

                            Law and Analysis

    Under Sec. 103.28 of the Bank Secrecy Act (``BSA'') regulations, 31 
CFR part 103, a financial institution must report on a Currency 
Transaction Report (``CTR'') the name and address of the individual 
conducting the transaction, and the identity, account number, and the 
social security or taxpayer identification number of any person on whose 
behalf the transaction was conducted. See 31 U.S.C. 5313. ``A 
participant acting for another person shall make the report as the agent 
or bailee of the person and identify the person for whom the transaction 
is being made.'' Identifying information about the person on whose 
behalf the transaction is conducted must always be furnished if the 
transaction is reportable under the BSA, regardless of whether the 
transaction involves an account.

[[Page 368]]

    Because the BSA requires financial institutions to file complete and 
accurate CTR's, it is the financial institution's responsibility to 
ascertain the real party in interest. 31 U.S.C. 5313. One way that a 
financial institution can obtain information about the identity of the 
person on whose behalf the transaction is being conducted is to ask the 
person conducting the transaction whether he is acting for himself or on 
behalf of another person. Only if as a result of strong ``know your 
customer'' or other internal control policies, the financial institution 
is satisfied that its records contain information concerning the true 
identity of the person on whose behalf the transaction is conducted, may 
the financial institution rely on those records to complete the CTR.
    No. 1. Linda Scott, an artist, is a known customer of the bank. The 
bank is aware that she is exhibiting her work at a local gallery and 
that cash deposits in the amount of $15,000 would not be unusual or 
inconsistent with Ms. Scott's business practices. Therefore, if the bank 
through its stringent ``know your customer'' policies is satisfied that 
the money being deposited by Ms. Scott into her personal account is for 
her benefit, the bank need not ask Ms. Scott whether she is acting on 
behalf of someone else.
    No. 2. Because Dick Wallace is a new customer of the bank and 
because the bank has no additional information about him or his business 
activity, the bank should ask Mr. Wallace whether he is acting on his 
own behalf or on behalf of someone else. This is particularly true given 
the nature of the transaction--a wire transfer with cash for an 
individual to a foreign country.
    No. 3. Dorothy Green's cash deposit of $50,000 into the law firm's 
trust account clearly is being done on behalf of someone else. The bank 
should ask Ms. Green to identify the clients on whose behalf the 
transaction is being conducted. Because Ms. Green is acting both on 
behalf of her employer and the clients, the names of the three clients 
and the law firm should be included on the CTR filed by the bank.
    No. 4. The currency dealer, having no account relationship with 
Carlos Gomez, should ask Mr. Gomez if he is acting on behalf of someone 
else.
    No. 5. Gail Julian is known to the bank as a trusted employee of Q-
mart, who often deposits cash into Q-mart's account. If the bank, 
through its strong ``know your customer'' policies is satisfied that Ms. 
Julian makes these deposits on behalf of Q-mart, the bank need not ask 
her if she is acting on behalf of someone other than Q-mart.

                                 Holding

    It is the responsibility of a financial institution to file complete 
and accurate CTRs. This includes providing identifying information about 
the person on whose behalf the transaction is conducted in Part II of 
the CTR. One way that a financial institution can obtain information 
about the true identity of the person on whose behalf the transaction is 
being conducted is to ask the person conducting the transaction whether 
he is acting for himself or on behalf of another person. Only if as a 
result of strong ``know your customer'' or other internal control 
policies, the financial institution is satisfied that its record contain 
the necessary information concerning the true identity of the person on 
whose behalf the transaction is being conducted, may the financial 
institutions rely on those records in completing the CTR.

                        92-1 (November 16, 1992)

31 U.S.C. 5313--Reports on Domestic Coins and Currency Transactions
31 U.S.C. 5325--Identification Required to Purchase Certain Monetary 
          Instruments
31 CFR 103.28--Identification Required
31 CFR 103.29--Purchases of Bank Checks and Drafts, Cashier's Checks, 
          Money Orders and Traveler's Checks

    Identification of elderly or disabled patrons conducting large 
currency transactions. Financial institutions must file a form 4789, 
Currency Transaction Report (CTR) on transactions in currency in excess 
of $10,000, and must verify and record information about the identity of 
the person(s) who conduct(s) the transaction in Part I of the CTR. 
Financial institutions also must record on a chronological log sales of, 
and verify the identity of individuals who purchase, certain monetary 
instruments with currency in amounts between $3,000 and $10,000, 
inclusive. Many financial institutions have asked Treasury how they can 
meet the requirement to examine an identifying document that contains 
the person's name and address when s/he does not possess such a document 
(e.g., a driver's license). Financial institutions have indicated that 
this question arises almost exclusively with their elderly and/or 
disabled patrons. This Administrative Ruling answers those inquiries.

                                  Issue

    How does a financial institution fulfill the requirement to verify 
and record the name and address of an elderly or disabled individual who 
conducts a currency transaction in excess of $10,000 or who purchases 
certain monetary instruments with currency valued between $3,000 and 
$10,000 when he/she does not possess a passport, alien identification 
card or other official document, or other document that is normally 
acceptable within the banking community as a means of identification 
when cashing checks for nondepositors?

[[Page 369]]

                                 Holding

    It is the responsibility of a financial institution to file complete 
and accurate CTRs and to maintain complete and accurate monetary 
instrument logs pursuant to 31 CFR Secs. 103.27(d) and 103.29 of the BSA 
regulations. It is also the responsibility of a financial institution to 
verify and to record the identity of individuals conducting reportable 
currency transactions and/or cash purchases of certain monetary 
instruments as required by BSA regulations Secs. 103.28 and 103.29. Only 
if the financial institution is confident that an elderly or disabled 
patron is who s/he says s/he is may it complete these transactions. A 
financial institution shall use whatever information it has available, 
in accordance with its established policies and procedures, to determine 
its patron's identity. This includes review of its internal records for 
any information on file, and asking for other forms of identification, 
including a social security or medicare/medicaid card along with another 
document which contains both the patron's name and address such as an 
organizational membership card, voter registration card, utility bill or 
real estate tax bill. These forms of identification shall also be 
identified as acceptable in the bank's formal written policy and 
operating procedures as identification for transactions involving the 
elderly or the disabled. Once implemented, the financial institution 
should permit no exception to its policy and procedures. In these cases, 
the financial institution should record the word ``Elderly'' or 
``Disabled'' on the CTR and/or chronological log and the method used to 
identify the elderly, or disabled patron such as ``Social Security and 
(organization) Membership Card only ID.''

                            Law and Analysis

    Before concluding a transaction for which a Currency Transaction 
Report is required pursuant to 31 CFR 103.22, a financial institution 
must verify and record the name and address of the individual conducting 
the transaction. 31 CFR 103.28. Verification of the individual's 
identity must be made by examination of a document, other than a bank 
signature card, that is normally acceptable within the banking community 
as a means of identification when cashing checks for nondepositors 
(e.g., a driver's license). A bank signature card may be relied upon 
only if it was issued after documents establishing the identity of the 
individual were examined and a notation of the method and specific 
information regarding identification (e.g., state of issuance and 
driver's license number) was made on the signature card. In each 
instance, the specific identifying information noted above and used to 
verify the identity of the individual must be recorded on the CTR. The 
notation of ``known customer'' or ``bank signature card on file'' on the 
CTR is prohibited. 31 CFR 103.28.
    Before issuing or selling bank checks or drafts, cashier's checks, 
traveler's checks or money orders to an individual(s), for currency 
between $3,000 and $10,000, a financial institution must verify whether 
the individual has a deposit account or verify the individual's 
identity. 31 CFR 103.29. Verification may be made by examination of a 
signature card or other account record at the financial institution if 
the deposit accountholder's name and address were verified at the time 
the account was opened, or at any subsequent time, and that information 
was recorded on the signature card or record being examined.
    Verification may also be made by examination of a document that 
contains the name and address of the purchaser and which is normally 
acceptable within the banking community as a means of identification 
when cashing checks for nondepositors. In the case of a deposit 
accountholder whose identity has not been previously verified, the 
financial institution shall record the specific identifying information 
on its chronological log (e.g. state of issuance and driver's license 
number). In all situations, the financial institution must record all 
the appropriate information required by Sec. 103.29(a)(1)(i) for deposit 
account holders or 103.29(a)(2)(i) for nondeposit account holders.
    Certain elderly or disabled patrons do not possess identification 
documents that would normally be considered acceptable within the 
banking community (e.g., driver's licenses, passports, or state-issued 
identification cards). Accordingly, the procedure set forth below should 
be followed to fulfill the identification verification requirements of 
Secs. 103.28 and 103.29.
    Financial institutions may accept as appropriate identification a 
social security, medicare, medicaid or other insurance card presented 
along with another document that contains both the name and address of 
the patron (e.g. an organization membership or voter registration card, 
utility or real estate tax bill). Such forms of identification shall be 
specified in the bank's formal written policy and operating procedures 
as acceptable identification for transactions involving elderly or 
disabled patrons who do not possess identification documents normally 
considered acceptable within the banking community for cashing checks 
for nondepositors.
    This procedure may only be applied if the following circumstances 
exist. First, the financial institution must establish that the 
identification the elderly or disabled patron has is limited to a social 
security or medicare/medicaid card plus another document which contains 
the patron's name and address. Second, the financial institution must 
use whatever information it has available, or

[[Page 370]]

policies and procedures it has in place, to determine the patron's 
identity. If the patron is a deposit accountholder, the financial 
institution should review its internal records to determine if there is 
information on file to verify his/her identity. Only if the financial 
institution is confident that the elderly or disabled patron is who s/he 
says s/he is, may the transaction be concluded. Failure to identify an 
elderly or a disabled customer's identity as required by 31 CFR 
Sec. 103.28 and as described herein may result in the imposition of 
civil and or criminal penalties. Finally, the financial institution 
shall establish a formal written policy and implement operating 
procedures for processing reportable currency transactions or recording 
cash sales of certain monetary instruments to elderly or disabled 
patrons who do not have forms of identification ordinarily considered 
``acceptable.'' Once implemented, the financial institution shall permit 
no exceptions to its policy and procedures. In addition, financial 
institutions are encouraged to record the elderly or disabled patron's 
identity and address as well as the method of identification on a 
signature card or other record when it is obtained and verified.
    In completing a CTR, if all of the above conditions are satisfied, 
the financial institution should enter the words ``Elderly'' or 
``Disabled'' and the method used to verify the patron's identity, such 
as ``Social Security and (organization) Membership Cards Only ID,'' in 
Item 15a.
    Similarly, when logging the cash purchase of a monetary 
instrument(s), the financial institution shall enter on its 
chronological log the words, ``Elderly'' or ``Disabled,'' and the method 
used to verify such patron's identity.

                                 Example

    Jesse Fleming, a 75 year old retiree, has been saving $10 bills for 
twenty years in order to help pay for his granddaughter's college 
education. He enters the Trustworthy National Bank where he has no 
account but his granddaughter has a savings account, and presents 
$13,000 in $10 bills to the teller. He instructs the teller to deposit 
$9,000 into his granddaughter's savings account, and requests a 
cashier's check for $4,000 made payable to State University.
    Because of poor eyesight, Mr. Fleming no longer drives and does not 
possess a valid driver's license. When asked for identification by the 
teller he presents a social security card and his retirement 
organization membership card that contains his name and address.

                      Application of Law to Example

    In this example, the Trustworthy National Bank must check to 
determine if Mr. Fleming's social security and organizational membership 
cards are acceptable forms of identification as defined in the bank's 
policy and procedures. If so, and the bank is confident that Mr. Fleming 
is who he says he is, it may complete the transaction. Because Mr. 
Fleming conducted a transaction in currency which exceeded $10,000 
(deposit of $9,000 and purchase of $4,000 monetary instrument), First 
National Bank must complete a CTR. It should record information about 
Mr. Fleming in Part I of the CTR and in Item 15a record the words 
``Elderly--Social Security and (organization) Membership Cards Only 
ID.'' The balance of the CTR must be appropriately completed as required 
by Secs. 103.22 and 103.27(d). First National Bank must also record the 
transaction in its monetary instrument sales log because it issued to 
Mr. Fleming a cashier's check for $4,000 in currency. Mr. Fleming must 
be listed as the purchaser and the bank should record on the log the 
words ``Elderly--Social Security and (organization) Membership Cards 
Only ID'' as the method used to verify his identity. In addition, 
because Mr. Fleming is not a deposit accountholder at First National 
Bank, the bank is required to record on the log all the information 
required under Sec. 103.29(a)(2)(i) for cash purchases of monetary 
instruments by nondeposit accountholders.

                        92-2 (November 16, 1992)

31 U.S.C. 5313--Reports on Domestic Coins and Currency Transactions
31 CFR 103.22--Reporting of Currency Transactions
31 CFR 103.28--Identification Required

    Proper completion of the Currency Transaction Report (CTR), IRS Form 
4789, when reporting multiple transactions. Financial institutions must 
report transactions in currency that exceed $10,000 or an exempted 
account's established exemption limit and provide certain information 
including verified identifying information about the individual 
conducting the transaction. Multiple currency transactions must be 
treated as a single transaction, aggregated, and reported on a single 
Form 4789, if the financial institution has knowledge that the 
transactions are by or on behalf of any person and result in either cash 
in or cash out totalling more than $10,000, or the exemption limit, 
during any one business day. All CTRs must be fully and accurately 
completed. Some or all of the individual transactions which comprise an 
aggregated CTR are frequently below the $10,000 reporting or applicable 
exemption threshold and, as such, are not reportable and financial 
institutions do not gather the information required to complete a CTR.

                                  Issue

    How should a financial institution complete a CTR when multiple 
transactions are

[[Page 371]]

aggregated and reported on a single form and all or part of the 
information called for in the form may not be known?

                                 Holding

    Multiple transactions that total in excess of $10,000, or an 
established exemption limit, when aggregated must be reported on a CTR 
if the financial institution has knowledge that the transactions have 
occurred. In many cases, the individual transactions being reported are 
each under $10,000, or the exemption limit, and the institution was not 
aware at the time of any one of the transactions that a CTR would be 
required. Therefore, the identifying information on the person 
conducting the transaction was not required to be obtained at the time 
the transaction was conducted.
    If after a reasonable effort to obtain the information required to 
complete items 4 through 15 of the CTR, all or part of such information 
is not available, the institution must check item 3d to indicate that 
the information is not being provided because the report involves 
multiple transactions for which complete information is not available. 
The institution must, however, provide as much of the information as is 
reasonably available.
    All subsections of item 48 on the CTR must be completed to report 
the number of transactions involved and the number of locations of the 
financial institution and zip codes of those locations where the 
transactions were conducted.

                            Law and Analysis

    Sections 103.22(a)(1) and (c) of the Bank Secrecy Act (BSA) 
regulations, 31 CFR part 103, require a financial institution to file a 
CTR for each deposit, withdrawal, exchange of currency, or other payment 
or transfer, by, through, or to the financial institution, which 
involves a transaction in currency of more than $10,000 or the 
established exemption limit for an exempt account. Multiple transactions 
must be treated as a single transaction if the financial institution has 
knowledge that they are by, or on behalf of, any person and result in 
either cash in or cash out of the financial institution totalling more 
than $10,000 or the exemption limit during any one business day. 
Knowledge, in this context, means knowledge on the part of a partner, 
director, officer or employee of the financial institution or on the 
part of any existing automated or manual system at the financial 
institution that permits it to aggregate transactions.
    The purpose of item 3 on the CTR is to indicate why all or part of 
the information required in items 4 through 15 is not being provided on 
the form. If the reason information is missing is solely because the 
transaction(s) occurred through an armored car service, a mail deposit 
or shipment, or a night deposit or Automated Teller Machine (ATM), the 
financial institution must check either box a, b, or c, as appropriate, 
in item 3. CTR instructions state that item 3d is to be checked for 
multiple transactions where none of the individual transactions exceeds 
$10,000 or the exemption limit and all of the required information might 
not be available.
    As described in Example No. 5 below, there may be situations where 
one transaction among several exceeds the applicable threshold. Item 3d 
should be checked whenever multiple transactions are being reported and 
all or part of the information necessary to complete items 4 through 15 
is not available because at the time of any one of the individual 
transactions, a CTR was not required and the financial institution did 
not obtain the appropriate information.
    When reporting multiple transactions, the financial institution must 
complete as many of items 4 through 15 as possible. In the event the 
institution learns that more than one person conducted the multiple 
transactions being reported, it must check item 2 on the CTR and is 
encouraged to make reasonable efforts to obtain and report any 
appropriate information on each of the persons in items 4 through 15 on 
the front and back of the CTR form, and if necessary, on additional 
sheets of paper attached to the report.
    The purpose of item 48 is to indicate that multiple transactions are 
involved in the CTR being filed. Items 48 a, b, and c require 
information about the number of transactions being reported and the 
number of bank branches and the zip code of each branch where the 
transactions took place. If multiple transactions exceeding $10,000 or 
an account exemption limit occur at the same time, the financial 
institution should treat the transactions in a manner consistent with 
its internal transaction posting procedures. For example, if a customer 
presents four separate deposits, at the same time, totalling over 
$10,000, the institution may report the transactions in item 48a to be 
one or four separate transactions. If the transactions are posted as 
four separate transactions the financial institution should enter the 
number 4 in item 48a and the number 1 in item 48b. If the transactions 
are posted as one transaction the institution should enter the 1 in both 
48a and 48b. Reporting the transactions in this manner will guarantee 
the integrity of the paper trail being created, that is, the number of 
transactions reported on the CTR will be the same as the number of 
transactions showing in the institution's records.
    These situations should be differentiated from those cases where 
separate transactions occur at different times during the same business 
day, and which, when aggregated, exceed $10,000 or the exemption limit. 
For instance, if the same or another individual

[[Page 372]]

conducts two of the same type of transactions at different times during 
the same business day at two different branches of the financial 
institution on behalf of the same person, and the institution has 
knowledge that the transactions occurred and exceed $10,000 or the 
exemption limit, then the financial institution must enter the number 2 
in items 48a and 48b.

               Examples and Application of Law to Examples

                              Example No. 1

    Dorothy Fishback presents a teller with three cash deposits to the 
same account, at the same time, in amounts of $5,000, $6,000, and $8,500 
requesting that the deposits be posted to the account separately. It is 
the bank's procedure to post the transactions separately. A CTR is 
completed while the customer is at the teller window.

                   Application of Law to Example No. 1

    A CTR is completed based upon the information obtained at the time 
Dorothy Fishback presents the multiple transactions. Item 3d would not 
be checked on the CTR because all of the information in items 4 through 
15 is being provided contemporaneously with the transaction. As it is 
the bank's procedure to post the transactions separately, the number of 
transactions reported in item 48a would be 3 and the number of branches 
reported in item 48b would be 1. The zip code for the location where the 
transactions were conducted would be entered in item 48c.

                              Example No. 2

    Andrew Weiner makes a $7,000 cash deposit to his account at ABC 
Federal Savings Bank. Later the same day, Mr. Weiner returns to the same 
teller and deposits $5,000 in cash to a different account. At the time 
Mr. Weiner makes the second deposit, the teller realizes that the two 
deposits exceed $10,000 and prepares a CTR obtaining all of the 
necessary identifying information directly from Mr. Weiner.

                   Application of Law to Example No. 2

    Even though the two transactions were conducted at different times 
during the same business day, Mr. Weiner conducted both transactions at 
the same place and the appropriate identifying information was obtained 
by the teller at the time of the second transaction. Item 3d would not 
be checked on the CTR. The number of transactions reported in item 48a 
must be 2 and the number of branches reported in item 48b would be 1. 
The zip code for the location where the transactions took place would be 
entered in item 48c.

                              Example No. 3

    Internal auditor Mike Pelzer is reviewing the daily cash 
transactions report for People's Bank and notices that five cash 
deposits were made the previous day to account #12345. The total of the 
deposits is $25,000 and they were made at three different offices of the 
bank. Mike researches the account data base and finds that the account 
belongs to a department store and that the account is exempted for 
deposits up to $17,000 per day. Each of the five transactions was under 
$17,000.

                   Application of Law to Example No. 3

    Having reviewed the report of aggregated transactions, Mike Pelzer 
has knowledge that transactions exceeding the account exemption limit 
have occurred during a single business day. A CTR must be filed. 
People's Bank is encouraged to make a reasonable effort to provide the 
information for items 4 through 15 on the CTR. Such efforts could 
include a search of the institution's records or a phone call to the 
department store to identify the persons that conducted the 
transactions. If all of the information is not contained in the 
institution's records or otherwise obtained, item 3d must be checked. 
The number of transactions reported in item 48a must be 5 and the number 
of branches reported in 48b would be 3. The zip codes for the three 
locations where the transactions occurred must be entered in item 48c.

                              Example No. 4

    Mrs. Saunders makes a cash withdrawal, for $4,000, from a joint 
savings account she owns with her husband. That day her husband, Mr. 
Saunders, withdraws $7,000 cash using the same teller. Realizing that 
the withdrawals exceed $10,000, the teller obtains identifying 
information on Mr. Saunders required to complete a CTR.

                   Application of Law to Example No. 4

    In this case, item 2 on the CTR must be checked because the teller 
knows that more than one person conducted the transactions. Information 
on Mr. Saunders would appear in Part I and the bank is encouraged to ask 
him for, or to check its records for the required identifying 
information on Mrs. Saunders. If after taking reasonable efforts to 
locate the desired information, all of the required information is not 
found on file in the institution's records or is not otherwise obtained, 
box 3d must be checked to indicate that all information is not being 
provided because multiple transactions are being reported. Whatever 
information on Mrs. Saunders is contained in the records of the 
institution must be reported in the continuation of Part I on the back 
of Form 4789. The number of transactions reported in item 48a must

[[Page 373]]

be 2 and the number of branches reported in item 48b would be 1. The zip 
code for the branch where the transactions took place would be entered 
in item 48c.

                              Example No. 5

    On another day, Mrs. Saunders makes a deposit of $3,000 cash and no 
information required for Part I of the CTR is requested of her. She is 
followed later the same day by her husband, Mr. Saunders, who deposits 
$12,000 in currency and who provides all data required to complete Part 
I for himself.

                   Application of Law to Example No. 5

    Item 2 on the CTR must be checked because the teller knows that more 
than one person conducted the transactions. Information on Mr. Saunders 
would appear in Part I and the bank is encouraged to ask him for, or to 
check its records for the required identifying information on Mrs. 
Saunders. If after taking reasonable efforts to locate the desired 
information, all of the required information is not found on file in the 
institution's records or is not otherwise obtained, box 3d must be 
checked to indicate that all information is not being provided because 
multiple transactions are being reported. Whatever information on Mrs. 
Saunders is contained in the records of the institution must be reported 
in the continuation of Part I on the back of Form 4789. The number of 
transactions reported in item 48a must be 2 and the number of branches 
reported in item 48b would be 1. The zip code for the branch where the 
transactions took place would be entered in item 48c.

                              Example No. 6

    A review of First Federal Bank's daily cash transactions report for 
a given day indicates several cash deposits to a single account totaling 
more than $10,000. Two separate deposits were made in the night 
depository at the institution's main office, and two deposits were 
conducted at the teller windows of two other branch locations. Each 
deposit was under $10,000.

                   Application of Law to Example No. 6

    Item 3c should be checked to indicate that identifying information 
is not provided because transactions were received through the night 
deposit box. If the tellers involved with the two face to face deposits 
remember who conducted the transactions, institution records can be 
checked for identifying information. If the records contain some of the 
information required by items 4 through 15, that information must be 
provided, and item 3d must be checked to indicate that some information 
is missing because multiple transactions are being reported and the 
information was not obtained at the time the transactions were 
conducted. Item 48a must indicate 4 transactions and item 48b must 
indicate 3 locations. The zip code of those locations would be provided 
in item 48c.

[53 FR 40064, Oct. 13, 1988, as amended at 54 FR 21214, May 17, 1989; 54 
FR 30543, July 21, 1989; 55 FR 1022, Jan. 11, 1990; 58 FR 7048, Feb. 4, 
1993]



PART 123 [RESERVED]--Table of Contents






PART 128--REPORTING OF INTERNATIONAL CAPITAL AND FOREIGN-CURRENCY TRANSACTIONS AND POSITIONS--Table of Contents




                     Subpart A--General Information

Sec.
128.1  General reporting requirements.
128.2  Manner of reporting.
128.3  Use of information reported.
128.4  Penalties.
128.5  Recordkeeping requirements.

 Subpart B--Reports on International Capital Transactions and Positions

128.11  Purpose of reports.
128.12  Periodic reports.
128.13  Special survey reports.

            Subpart C--Reports on Foreign Currency Positions

128.21  Purpose of reports.
128.22  Periodic reports.
128.23  Special survey reports.

Appendix A to Part 128--Determination Made by National Advisory Council 
          Pursuant to Section 2 (a) and (b) of E.O. 10033

    Authority: 22 U.S.C. 286f and 3101 et seq.; 31 U.S.C. 5315 and 5321.

    Source: 58 FR 58495, Nov. 2, 1993, unless otherwise noted.



                     Subpart A--General Information



Sec. 128.1  General reporting requirements.

    (a) International capital transactions and positions. (1) In order 
to implement the International Investment and Trade in Services Survey 
Act, as amended (22 U.S.C. 3101 et seq.); and E.O. 11961, and to obtain 
information requested by the International Monetary Fund under the 
articles of agreement of the Fund pursuant to section 8(a) of the 
Bretton Woods Agreements

[[Page 374]]

Act (22 U.S.C. 286f) and E.O. 10033, persons subject to the jurisdiction 
of the United States are required to report information pertaining to--
    (i) United States claims on, and liabilities to, foreigners;
    (ii) Transactions in securities and other financial assets with 
foreigners; and
    (iii) The monetary reserves of the United States.
    (2) Data pertaining to direct investment transactions are not 
required to be reported under this Part.
    (3) Reports shall be made in such manner and at such intervals as 
specified by the Secretary of the Treasury. See subpart B of this part 
for additional requirements concerning these reports.
    (b) Foreign currency positions. (1) In order to provide data on the 
nature and source of flows of mobile capital, including transactions by 
large United States business enterprises (as determined by the 
Secretary) and their foreign affiliates as required by 31 U.S.C. 5315, 
persons subject to the jurisdiction of the United States are required to 
report information pertaining to--
    (i) Transactions in foreign exchange;
    (ii) Transfers of credit that are, in whole or part, denominated in 
a foreign currency; and
    (iii) The creation or acquisition of claims that reference 
transactions, holdings, or evaluations of foreign exchange.
    (2) Reports shall be made in such manner and at such intervals as 
specified by the Secretary. See subpart C of this part for additional 
requirements concerning these reports.
    (c) Notice of reports. Notice of reports required by this part, 
specification of persons required to file report, and forms to be used 
to file reports will be published in the Federal Register. Persons 
currently required to file reports shall continue to file such reports 
using existing Treasury International Capital Forms BL-1/BL-1(SA), BL-2/
BL-2(SA), BL-3, BC/BC(SA), BQ-1, BQ-2, CM, CQ-1, CQ-2, S, and existing 
Treasury Foreign Currency Forms FC-1, FC-2, FC-3, and FC-4 until further 
notice is published in the Federal Register.



Sec. 128.2  Manner of reporting.

    (a) Methods of reporting--(1) Prescribed forms. (i) Except as 
provided in Sec. 128.2(a)(2), reports required by this part shall be 
made on forms prescribed by the Secretary. The forms and accompanying 
instructions will be published in accordance with Sec. 128.1(c).
    (ii) Copies of forms and instructions prescribed by the Secretary 
for reporting under this Part may be obtained from any Federal Reserve 
Bank, or from the Office of the Assistant Secretary (Economic Policy), 
Department of the Treasury, Washington, DC 20220.
    (2) Alternative methods of reporting. In lieu of reporting on forms 
prescribed by the Secretary pursuant to this part, reports may be filed 
on magnetic tape or other media acceptable to, and approved in writing 
by, the Federal Reserve district bank with which the report is filed, or 
by the Assistant Secretary (Economic Policy) in the case of a special 
exception filing pursuant to Sec. 128.2(b)(3). The Secretary may require 
that magnetic tape or other machine-readable media, or other rapid means 
of communication be used for filing special survey reports under subpart 
B or C of this part.
    (b) Filing of periodic reports--(1) Banks and other depository 
institutions, International Banking Facilities, and bank holding 
companies. Except as provided in Sec. 128.2(b)(3), each bank, depository 
institution, International Banking Facility, and bank holding company in 
the United States required to file periodic reports under subpart B or C 
of this part shall file such reports with the Federal Reserve bank of 
the district in which such bank, depository institution, International 
Banking Facility or bank holding company has its principal place of 
business in the United States.
    (2) Nonbanking enterprises and other persons. Except as provided in 
Sec. 128.2(b)(3), nonbanking enterprises and other persons in the United 
States required to file periodic reports under subpart B or C of this 
part shall file such reports with the Federal Reserve Bank of New York.
    (3) Special exceptions. If a respondent described in 
Sec. 128.2(b)(1) or (2) is unable to file with a Federal Reserve 
district

[[Page 375]]

bank, such respondent shall file periodic reports with the Office of the 
Assistant Secretary (Economic Policy), Department of the Treasury, 
Washington, DC 20220, or as otherwise provided in the instructions to 
the periodic report forms.
    (c) Filing of special survey reports. All respondents required to 
file special survey reports under subpart B or C of this part file such 
reports as provided in Sec. 128.2(b) unless otherwise provided in the 
instructions to the special survey reports.



Sec. 128.3  Use of information reported.

    (a) Except for use in violation and enforcement proceedings pursuant 
to the International Investment and Trade in Services Survey Act, 22 
U.S.C. 3101 et seq., information submitted by any individual respondent 
on reports required under subpart B of this part may be used only for 
analytical and statistical purposes within the United States Government 
and will not be disclosed publicly by the Department of the Treasury, or 
by any other Federal agency or Federal Reserve district bank having 
access to the information as provided herein. Aggregate data derived 
from these forms may be published or otherwise publicly disclosed only 
in a manner which will not reveal the amounts reported by any individual 
respondent. The Department may furnish information from these forms to 
the Federal Reserve Board and to Federal agencies to the extent 
permitted by applicable law.
    (b) The information submitted by any individual respondent on 
reports required under subpart C of this part will not be disclosed 
publicly. Aggregated data may be published or disclosed only in a manner 
which will not reveal the information reported by any individual 
respondent. The Department may furnish to Federal agencies, the Board of 
Governors of the Federal Reserve System, and to Federal Reserve district 
banks data reported pursuant to subpart C of this part to the extent 
permitted by applicable law.



Sec. 128.4  Penalties.

    (a) Whoever fails to file a report required by subpart B of this 
part shall be subject to a civil penalty of not less than $2,500 and not 
more than $25,000
    (b) Whoever willfully fails to file a report required by subpart B 
of this part may be criminally prosecuted and upon conviction fined not 
more than $10,000 and, if an individual (including any officer, 
director, employee, or agent of any corporation who knowingly 
participates in such violation), may be imprisoned for not more than one 
year, or both.
    (c) Whoever fails to file a report required by subpart C of this 
part shall be subject to a civil penalty of not more than $10,000.



Sec. 128.5  Recordkeeping requirements.

    Banks, other depository institutions, International Banking 
Facilities, bank holding companies, brokers and dealers, and nonbanking 
enterprises subject to the jurisdiction of the United States shall 
maintain all information necessary to make a complete report pursuant to 
this Part for not less than three years from the date such report is 
required to be filed or was filed, whichever is later, or for such 
shorter period as may be specified in the instructions to the applicable 
report form.

(Approved by the Office of Management and Budget under control number 
1505-0149)



 Subpart B--Reports on International Capital Transactions and Positions



Sec. 128.11  Purpose of reports.

    Reports on international capital transactions and positions provide 
timely and reliable information on international portfolio capital 
movements by U.S. persons. This information is needed for preparation of 
the capital accounts of the United States balance of payments and the 
international investment position of the United States.



Sec. 128.12  Periodic reports.

    (a) International capital positions. (1) Banks and other depository 
institutions, International Banking Facilities, bank holding companies, 
and brokers and dealers in the United States

[[Page 376]]

shall file monthly, quarterly and semiannual reports with respect to 
specified claims and liabilities positions with foreigners held for 
their own account and for the accounts of their customers.
    (2) Nonbanking enterprises in the United States not described in 
Sec. 128.12(a)(1) shall file monthly and quarterly reports with respect 
to deposits and certificates of deposit with banks outside the United 
States and specified claims and liabilities positions with unaffiliated 
foreigners.
    (b) Transactions in certain domestic and foreign long-term 
securities. Banks and nonbanking enterprises in the United States shall 
file monthly reports on their transactions in domestic and foreign long-
term securities or other financial assets with foreign residents.
    (c) Notice of periodic reports. Notice of periodic reports will be 
published in accordance with Sec. 128.1(c).



Sec. 128.13  Special survey reports.

    The Secretary may prescribe special survey reports at such times as 
the Secretary determines there is a need for detailed information on the 
aggregate data derived from current periodic reports or to provide 
additional qualitative information with respect to such data. Notice of 
special survey reports will be published in accordance with 
Sec. 128.1(c).



            Subpart C--Reports on Foreign Currency Positions



Sec. 128.21  Purpose of reports.

    Reports by respondents on foreign currency positions provide data on 
the nature and source of flows of mobile capital, including transactions 
by large United States business enterprises (as determined by the 
Secretary) and their foreign affiliates as required by 31 U.S.C. 5315.



Sec. 128.22  Periodic reports.

    Respondents shall file reports weekly, monthly and quarterly on the 
value of such items as outstanding foreign exchange contracts, dealing 
positions, derivative foreign currency instruments, and other assets and 
liabilities denominated in the currencies specified on the forms. Notice 
of periodic reports will be published in accordance with Sec. 128.1(c).



Sec. 128.23  Special survey reports.

    The Secretary may prescribe special survey reports with respect to 
foreign exchange positions and related information at such times as the 
Secretary determines that there is a need for prompt or expanded 
information on current conditions in the foreign exchange markets. 
Notice of special survey reports will be published in accordance with 
Sec. 128.1(c).

Appendix A to Part 128--Determination Made by National Advisory Council 
             Pursuant to Section 2(a) and (b) of E.O. 10033

I. Determination of the National Advisory Council pursuant to E.O. 10033

    In an action dated September 7, 1965, the National Advisory Council 
on International Monetary and Financial Problems made the following 
determination pursuant to section 2(a) of E.O. 10033 of February 8, 
1949.
    Action 65 (E.O.)-49. The National Advisory Council, having consulted 
with the Director of the Bureau of the Budget, determines the current 
information with respect to international capital movements, derived 
from data on U.S. liabilities to and claims on foreigners and 
transactions in securities with foreigners, and current information with 
respect to U.S. gold holdings, foreign-currency holdings, and dollar 
liabilities to foreigners, are essential in order that the United States 
may comply with official requests of the International Monetary Fund for 
information with respect to the U.S. balance of payments and monetary 
reserves.
    Action No. 320, March 17, 1949 is superseded by this determination 
and is hereby revoked.
    II. Designation of the Treasury Department by the Director of the 
Bureau of the Budget pursuant to section 2(b) of E.O. 10033.
    On December 1, 1965, the Treasury Department was designated, 
pursuant to section 2(b) of E.O. 10033 of February 8, 1949, to collect 
information for the International Monetary Fund under the National 
Advisory Council determination of September 7, 1965. The letter 
containing the designation reads as follows:

                            December 1, 1965.

Hon. Henry H. Fowler,
Secretary of the Treasury, Washington, DC 20220.

    Dear Mr. Secretary: On September 7, 1965, the National Advisory 
Council after consultation with this Bureau in accordance

[[Page 377]]

with section 2(a) of Executive Order 10033, made the following 
determination (Action 65 (E.O.)-49:
    ``The National Advisory Council, having consulted with the Director 
of the Bureau of the Budget, determines that current information with 
respect to international capital movements, derived from data on U.S. 
liabilities to claims on foreigners and transactions in securities with 
foreigners, and current information with respect to U.S. gold holdings, 
foreign-currency holdings, and dollar liabilities to foreigners, are 
essential in order that the United States may comply with official 
requests of the International Monetary Fund for information with respect 
to the U.S. balance of payments and monetary reserves.''
    It is hereby determined pursuant to section 2(b) of Executive Order 
10033, that the Treasury Department shall collect information pertaining 
to capital movements between the United States and foreign countries and 
pertaining to the monetary reserves of the United States, except 
information pertaining to direct-investment transactions, U.S. 
Government foreign lending operations, and claims and liabilities of 
U.S. Government agencies (other than public debt obligations), which is 
collected by the Department of Commerce.
    This letter supersedes the earlier determination as to the 
responsibilities of the Treasury Department in this area, dated April 
21, 1949, as amended May 4, 1950.

                            Sincerely yours,

Raymond T. Bowman,
Assistant Director for Statistical Standards.



PART 129--PORTFOLIO INVESTMENT SURVEY REPORTING--Table of Contents




Sec.
129.1  Purpose.
129.2  Definitions.
129.3  Reporting requirements.
129.4  Recordkeeping requirements.
129.5  Confidentiality.
129.6  Penalties specified by law.

    Authority: 22 U.S.C. 3101 et seq.; E.O. 11961, 42 FR 4321, 3 CFR, 
1977 Comp., p. 86.

    Source: 58 FR 30707, May 27, 1993, unless otherwise noted.



Sec. 129.1  Purpose.

    The purpose of this part is to provide general information on 
portfolio investment survey data collection programs and analyses under 
the International Investment and Trade in Services Survey Act ((formerly 
the International Investment Survey Act of 1976) (the ``Act'')). The 
purpose of the Act is to provide for the collection of comprehensive and 
reliable information concerning international investment, including 
portfolio investment. The Act specifies that regular data collection 
programs and surveys specified by the Act or deemed necessary by the 
Secretary of the Treasury shall be conducted to secure information on 
international capital flows and other information related to 
international portfolio investment, including information that may be 
necessary for computing and analyzing the United States balance of 
payments.



Sec. 129.2  Definitions.

    For purposes of the Act and for reporting requirements under this 
Part:
    (a) United States, when used in a geographic sense, means the 
several States, the District of Columbia, the Commonwealth of Puerto 
Rico, and the territories and possessions of the United States.
    (b) Foreign, when used in a geographic sense, means that which is 
situated outside the United States or which belongs to or is 
characteristic of a country other than the United States.
    (c) Person means any individual, branch, partnership, associated 
group, association, estate, trust, corporation, or other organization 
(whether or not organized under the laws of any State), and any 
government (including a foreign government, the United States 
Government, a State or local government, and any agency, corporation, 
financial institution, or other entity or instrumentality thereof, 
including a government-sponsored agency).
    (d) United States person means any person resident in the United 
States or subject to the jurisdiction of the United States.
    (e) Foreign person means any person resident outside the United 
States or subject to the jurisdiction of a country other than the United 
States.
    (f) Foreign parent means any foreign person who owns or controls, 
directly or indirectly, 10 percent or more of the voting securities of 
an incorporated United States business enterprise, or

[[Page 378]]

an equivalent interest in an unincorporated United States business 
enterprise.
    (g) Reporter means a United States person required to file a report.
    (h) Foreign official institution means central governments of 
foreign countries and their possessions, including recognized central 
banks of issue.



Sec. 129.3  Reporting requirements.

    (a) Notice of specific reporting requirements, including who is 
required to report, the information to be reported, the manner of 
reporting, and the time and place of filing reports, will be published 
by the Secretary of the Treasury in the Federal Register prior to the 
implementation of each survey or study.
    (b) Written responses are required from all reporters.
    (c) Information required from reporters shall be furnished under 
oath.



Sec. 129.4  Recordkeeping requirement.

    Reporters shall maintain all information used in preparing a report 
under this part for the period specified in the notice published by the 
Secretary of the Treasury pursuant to section 129.3, and shall make this 
information available for review and inspection at the request of the 
Department of the Treasury.



Sec. 129.5  Confidentiality.

    (a) Information collected pursuant to the Act will be kept in 
confidence.
    (b) Access to information collected pursuant to the Act shall be 
available only to officials and employees (including consultants and 
contractors and their employees) designated by the Secretary of the 
Treasury to perform functions under the Act.
    (c) Nothing in this part shall be construed to require any Federal 
agency to disclose information otherwise protected by law.
    (d) No person can compel the submission or disclosure of reports, or 
constituent parts thereof, or copies of such reports or constituents 
parts thereof, prepared pursuant to this part, without the prior written 
consent of the person who maintained or who furnished the report and the 
customer of the person who furnished the report, where the information 
supplied is identifiable as being derived from the records of the 
customer. As required by the Act, any published reports issued by the 
Treasury based upon information pursuant to this part will only contain 
data aggregated in such a way that neither the person supplying the 
information nor the investor can be identified.



Sec. 129.6  Penalties specified by law.

    Reporters are advised that the Act provides the following penalties:
    (a) Civil Penalties. Whoever fails to furnish any information 
required under the Act, whether required to be furnished in the form of 
a report or otherwise, or to comply with any other rule, regulation, 
order, or instruction promulgated under the Act, shall be subject to a 
civil penalty of not less than $2,500 and not more than $25,000.
    (b) Criminal Penalties. Whoever willfully violates any rule, 
regulation, order, or instruction promulgated under the Act, upon 
conviction, shall be fined not more than $10,000 and, if an individual, 
may be imprisoned for not more than one year, or both, and any officer, 
director, employee, or agent of any corporation who knowingly 
participates in such violation, upon conviction, may be punished by a 
like fine, imprisonment or both.



PARTS 130--199 [RESERVED]

[[Page 379]]



                              FINDING AIDS




  --------------------------------------------------------------------

  A list of CFR titles, subtitles, chapters, subchapters and parts and 
an alphabetical list of agencies publishing in the CFR are included in 
the CFR Index and Finding Aids volume to the Code of Federal Regulations 
which is published separately and revised annually.

  Material Approved for Incorporation by Reference
  Table of CFR Titles and Chapters
  Alphabetical List of Agencies Appearing in the CFR
  List of CFR Sections Affected

[[Page 381]]

            Material Approved for Incorporation by Reference

                      (Revised as of July 1, 2000)

  The Director of the Federal Register has approved under 5 U.S.C. 
552(a) and 1 CFR Part 51 the incorporation by reference of the following 
publications. This list contains only those incorporations by reference 
effective as of the revision date of this volume. Incorporations by 
reference found within a regulation are effective upon the effective 
date of that regulation. For more information on incorporation by 
reference, see the preliminary pages of this volume.


31 CFR (PARTS 0 TO 199)

MONETARY OFFICES, DEPARTMENT OF THE TREASURY
                                                                  31 CFR


American National Standards Institute

  11 West 42nd Street, New York, NY 10036; 
  Telephone: (212) 642-4900
ANSI A117.1--80, Specifications for Making                   51.55(k)(9)
  Buildings and Facilities Accessible to, and 
  Usable by the Physically Handicapped.
  (The following standard is available from: The 
  Engineering Society Library, 345 E. 47th St., 
  New York, NY 10017 (212) 644-7611 and Document 
  Engineering Company, 15210 Stagg St., Van Nuys, 
  CA 91405, (213) 782-1010, 873-5366.)
ANSI A117.1--61 (R 71) Specifications for Making             51.55(k)(9)
  Buildings and Facilities Accessible to and 
  Usable by the Physically Handicapped.



[[Page 383]]



                    Table of CFR Titles and Chapters




                      (Revised as of June 23, 2000)

                      Title 1--General Provisions

         I  Administrative Committee of the Federal Register 
                (Parts 1--49)
        II  Office of the Federal Register (Parts 50--299)
        IV  Miscellaneous Agencies (Parts 400--500)

                          Title 2--[Reserved]

                        Title 3--The President

         I  Executive Office of the President (Parts 100--199)

                           Title 4--Accounts

         I  General Accounting Office (Parts 1--99)
        II  Federal Claims Collection Standards (General 
                Accounting Office--Department of Justice) (Parts 
                100--299)

                   Title 5--Administrative Personnel

         I  Office of Personnel Management (Parts 1--1199)
        II  Merit Systems Protection Board (Parts 1200--1299)
       III  Office of Management and Budget (Parts 1300--1399)
         V  The International Organizations Employees Loyalty 
                Board (Parts 1500--1599)
        VI  Federal Retirement Thrift Investment Board (Parts 
                1600--1699)
       VII  Advisory Commission on Intergovernmental Relations 
                (Parts 1700--1799)
      VIII  Office of Special Counsel (Parts 1800--1899)
        IX  Appalachian Regional Commission (Parts 1900--1999)
        XI  Armed Forces Retirement Home (Part 2100)
       XIV  Federal Labor Relations Authority, General Counsel of 
                the Federal Labor Relations Authority and Federal 
                Service Impasses Panel (Parts 2400--2499)
        XV  Office of Administration, Executive Office of the 
                President (Parts 2500--2599)
       XVI  Office of Government Ethics (Parts 2600--2699)
       XXI  Department of the Treasury (Parts 3100--3199)
      XXII  Federal Deposit Insurance Corporation (Part 3201)

[[Page 384]]

     XXIII  Department of Energy (Part 3301)
      XXIV  Federal Energy Regulatory Commission (Part 3401)
       XXV  Department of the Interior (Part 3501)
      XXVI  Department of Defense (Part 3601)
    XXVIII  Department of Justice (Part 3801)
      XXIX  Federal Communications Commission (Parts 3900--3999)
       XXX  Farm Credit System Insurance Corporation (Parts 4000--
                4099)
      XXXI  Farm Credit Administration (Parts 4100--4199)
    XXXIII  Overseas Private Investment Corporation (Part 4301)
      XXXV  Office of Personnel Management (Part 4501)
        XL  Interstate Commerce Commission (Part 5001)
       XLI  Commodity Futures Trading Commission (Part 5101)
      XLII  Department of Labor (Part 5201)
     XLIII  National Science Foundation (Part 5301)
       XLV  Department of Health and Human Services (Part 5501)
      XLVI  Postal Rate Commission (Part 5601)
     XLVII  Federal Trade Commission (Part 5701)
    XLVIII  Nuclear Regulatory Commission (Part 5801)
         L  Department of Transportation (Part 6001)
       LII  Export-Import Bank of the United States (Part 6201)
      LIII  Department of Education (Parts 6300--6399)
       LIV  Environmental Protection Agency (Part 6401)
      LVII  General Services Administration (Part 6701)
     LVIII  Board of Governors of the Federal Reserve System (Part 
                6801)
       LIX  National Aeronautics and Space Administration (Part 
                6901)
        LX  United States Postal Service (Part 7001)
       LXI  National Labor Relations Board (Part 7101)
      LXII  Equal Employment Opportunity Commission (Part 7201)
     LXIII  Inter-American Foundation (Part 7301)
       LXV  Department of Housing and Urban Development (Part 
                7501)
      LXVI  National Archives and Records Administration (Part 
                7601)
      LXIX  Tennessee Valley Authority (Part 7901)
      LXXI  Consumer Product Safety Commission (Part 8101)
    LXXIII  Department of Agriculture (Part 8301)
     LXXIV  Federal Mine Safety and Health Review Commission (Part 
                8401)
     LXXVI  Federal Retirement Thrift Investment Board (Part 8601)
    LXXVII  Office of Management and Budget (Part 8701)

                          Title 6--[Reserved]

                         Title 7--Agriculture

            Subtitle A--Office of the Secretary of Agriculture 
                (Parts 0--26)
            Subtitle B--Regulations of the Department of 
                Agriculture

[[Page 385]]

         I  Agricultural Marketing Service (Standards, 
                Inspections, Marketing Practices), Department of 
                Agriculture (Parts 27--209)
        II  Food and Nutrition Service, Department of Agriculture 
                (Parts 210--299)
       III  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 300--399)
        IV  Federal Crop Insurance Corporation, Department of 
                Agriculture (Parts 400--499)
         V  Agricultural Research Service, Department of 
                Agriculture (Parts 500--599)
        VI  Natural Resources Conservation Service, Department of 
                Agriculture (Parts 600--699)
       VII  Farm Service Agency, Department of Agriculture (Parts 
                700--799)
      VIII  Grain Inspection, Packers and Stockyards 
                Administration (Federal Grain Inspection Service), 
                Department of Agriculture (Parts 800--899)
        IX  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Fruits, Vegetables, Nuts), Department 
                of Agriculture (Parts 900--999)
         X  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Milk), Department of Agriculture 
                (Parts 1000--1199)
        XI  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Miscellaneous Commodities), Department 
                of Agriculture (Parts 1200--1299)
      XIII  Northeast Dairy Compact Commission (Parts 1300--1399)
       XIV  Commodity Credit Corporation, Department of 
                Agriculture (Parts 1400--1499)
        XV  Foreign Agricultural Service, Department of 
                Agriculture (Parts 1500--1599)
       XVI  Rural Telephone Bank, Department of Agriculture (Parts 
                1600--1699)
      XVII  Rural Utilities Service, Department of Agriculture 
                (Parts 1700--1799)
     XVIII  Rural Housing Service, Rural Business-Cooperative 
                Service, Rural Utilities Service, and Farm Service 
                Agency, Department of Agriculture (Parts 1800--
                2099)
      XXVI  Office of Inspector General, Department of Agriculture 
                (Parts 2600--2699)
     XXVII  Office of Information Resources Management, Department 
                of Agriculture (Parts 2700--2799)
    XXVIII  Office of Operations, Department of Agriculture (Parts 
                2800--2899)
      XXIX  Office of Energy, Department of Agriculture (Parts 
                2900--2999)
       XXX  Office of the Chief Financial Officer, Department of 
                Agriculture (Parts 3000--3099)
      XXXI  Office of Environmental Quality, Department of 
                Agriculture (Parts 3100--3199)
     XXXII  Office of Procurement and Property Management, 
                Department of Agriculture (Parts 3200--3299)

[[Page 386]]

    XXXIII  Office of Transportation, Department of Agriculture 
                (Parts 3300--3399)
     XXXIV  Cooperative State Research, Education, and Extension 
                Service, Department of Agriculture (Parts 3400--
                3499)
      XXXV  Rural Housing Service, Department of Agriculture 
                (Parts 3500--3599)
     XXXVI  National Agricultural Statistics Service, Department 
                of Agriculture (Parts 3600--3699)
    XXXVII  Economic Research Service, Department of Agriculture 
                (Parts 3700--3799)
   XXXVIII  World Agricultural Outlook Board, Department of 
                Agriculture (Parts 3800--3899)
       XLI  [Reserved]
      XLII  Rural Business-Cooperative Service and Rural Utilities 
                Service, Department of Agriculture (Parts 4200--
                4299)

                    Title 8--Aliens and Nationality

         I  Immigration and Naturalization Service, Department of 
                Justice (Parts 1--599)

                 Title 9--Animals and Animal Products

         I  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 1--199)
        II  Grain Inspection, Packers and Stockyards 
                Administration (Packers and Stockyards Programs), 
                Department of Agriculture (Parts 200--299)
       III  Food Safety and Inspection Service, Department of 
                Agriculture (Parts 300--599)

                           Title 10--Energy

         I  Nuclear Regulatory Commission (Parts 0--199)
        II  Department of Energy (Parts 200--699)
       III  Department of Energy (Parts 700--999)
         X  Department of Energy (General Provisions) (Parts 
                1000--1099)
      XVII  Defense Nuclear Facilities Safety Board (Parts 1700--
                1799)
     XVIII  Northeast Interstate Low-Level Radioactive Waste 
                Commission (Part 1800)

                      Title 11--Federal Elections

         I  Federal Election Commission (Parts 1--9099)

                      Title 12--Banks and Banking

         I  Comptroller of the Currency, Department of the 
                Treasury (Parts 1--199)

[[Page 387]]

        II  Federal Reserve System (Parts 200--299)
       III  Federal Deposit Insurance Corporation (Parts 300--399)
        IV  Export-Import Bank of the United States (Parts 400--
                499)
         V  Office of Thrift Supervision, Department of the 
                Treasury (Parts 500--599)
        VI  Farm Credit Administration (Parts 600--699)
       VII  National Credit Union Administration (Parts 700--799)
      VIII  Federal Financing Bank (Parts 800--899)
        IX  Federal Housing Finance Board (Parts 900--999)
        XI  Federal Financial Institutions Examination Council 
                (Parts 1100--1199)
       XIV  Farm Credit System Insurance Corporation (Parts 1400--
                1499)
        XV  Department of the Treasury (Parts 1500--1599)
      XVII  Office of Federal Housing Enterprise Oversight, 
                Department of Housing and Urban Development (Parts 
                1700--1799)
     XVIII  Community Development Financial Institutions Fund, 
                Department of the Treasury (Parts 1800--1899)

               Title 13--Business Credit and Assistance

         I  Small Business Administration (Parts 1--199)
       III  Economic Development Administration, Department of 
                Commerce (Parts 300--399)
        IV  Emergency Steel Guarantee Loan Board (Parts 400--499)
         V  Emergency Oil and Gas Guaranteed Loan Board (Parts 
                500--599)

                    Title 14--Aeronautics and Space

         I  Federal Aviation Administration, Department of 
                Transportation (Parts 1--199)
        II  Office of the Secretary, Department of Transportation 
                (Aviation Proceedings) (Parts 200--399)
       III  Commercial Space Transportation, Federal Aviation 
                Administration, Department of Transportation 
                (Parts 400--499)
         V  National Aeronautics and Space Administration (Parts 
                1200--1299)

                 Title 15--Commerce and Foreign Trade

            Subtitle A--Office of the Secretary of Commerce (Parts 
                0--29)
            Subtitle B--Regulations Relating to Commerce and 
                Foreign Trade
         I  Bureau of the Census, Department of Commerce (Parts 
                30--199)
        II  National Institute of Standards and Technology, 
                Department of Commerce (Parts 200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)

[[Page 388]]

        IV  Foreign-Trade Zones Board, Department of Commerce 
                (Parts 400--499)
       VII  Bureau of Export Administration, Department of 
                Commerce (Parts 700--799)
      VIII  Bureau of Economic Analysis, Department of Commerce 
                (Parts 800--899)
        IX  National Oceanic and Atmospheric Administration, 
                Department of Commerce (Parts 900--999)
        XI  Technology Administration, Department of Commerce 
                (Parts 1100--1199)
      XIII  East-West Foreign Trade Board (Parts 1300--1399)
       XIV  Minority Business Development Agency (Parts 1400--
                1499)
            Subtitle C--Regulations Relating to Foreign Trade 
                Agreements
        XX  Office of the United States Trade Representative 
                (Parts 2000--2099)
            Subtitle D--Regulations Relating to Telecommunications 
                and Information
     XXIII  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                2300--2399)

                    Title 16--Commercial Practices

         I  Federal Trade Commission (Parts 0--999)
        II  Consumer Product Safety Commission (Parts 1000--1799)

             Title 17--Commodity and Securities Exchanges

         I  Commodity Futures Trading Commission (Parts 1--199)
        II  Securities and Exchange Commission (Parts 200--399)
        IV  Department of the Treasury (Parts 400--499)

          Title 18--Conservation of Power and Water Resources

         I  Federal Energy Regulatory Commission, Department of 
                Energy (Parts 1--399)
       III  Delaware River Basin Commission (Parts 400--499)
        VI  Water Resources Council (Parts 700--799)
      VIII  Susquehanna River Basin Commission (Parts 800--899)
      XIII  Tennessee Valley Authority (Parts 1300--1399)

                       Title 19--Customs Duties

         I  United States Customs Service, Department of the 
                Treasury (Parts 1--199)
        II  United States International Trade Commission (Parts 
                200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)

[[Page 389]]

                     Title 20--Employees' Benefits

         I  Office of Workers' Compensation Programs, Department 
                of Labor (Parts 1--199)
        II  Railroad Retirement Board (Parts 200--399)
       III  Social Security Administration (Parts 400--499)
        IV  Employees' Compensation Appeals Board, Department of 
                Labor (Parts 500--599)
         V  Employment and Training Administration, Department of 
                Labor (Parts 600--699)
        VI  Employment Standards Administration, Department of 
                Labor (Parts 700--799)
       VII  Benefits Review Board, Department of Labor (Parts 
                800--899)
      VIII  Joint Board for the Enrollment of Actuaries (Parts 
                900--999)
        IX  Office of the Assistant Secretary for Veterans' 
                Employment and Training, Department of Labor 
                (Parts 1000--1099)

                       Title 21--Food and Drugs

         I  Food and Drug Administration, Department of Health and 
                Human Services (Parts 1--1299)
        II  Drug Enforcement Administration, Department of Justice 
                (Parts 1300--1399)
       III  Office of National Drug Control Policy (Parts 1400--
                1499)

                      Title 22--Foreign Relations

         I  Department of State (Parts 1--199)
        II  Agency for International Development (Parts 200--299)
       III  Peace Corps (Parts 300--399)
        IV  International Joint Commission, United States and 
                Canada (Parts 400--499)
         V  Broadcasting Board of Governors (Parts 500--599)
       VII  Overseas Private Investment Corporation (Parts 700--
                799)
        IX  Foreign Service Grievance Board Regulations (Parts 
                900--999)
         X  Inter-American Foundation (Parts 1000--1099)
        XI  International Boundary and Water Commission, United 
                States and Mexico, United States Section (Parts 
                1100--1199)
       XII  United States International Development Cooperation 
                Agency (Parts 1200--1299)
      XIII  Board for International Broadcasting (Parts 1300--
                1399)
       XIV  Foreign Service Labor Relations Board; Federal Labor 
                Relations Authority; General Counsel of the 
                Federal Labor Relations Authority; and the Foreign 
                Service Impasse Disputes Panel (Parts 1400--1499)
        XV  African Development Foundation (Parts 1500--1599)
       XVI  Japan-United States Friendship Commission (Parts 
                1600--1699)
      XVII  United States Institute of Peace (Parts 1700--1799)

[[Page 390]]

                          Title 23--Highways

         I  Federal Highway Administration, Department of 
                Transportation (Parts 1--999)
        II  National Highway Traffic Safety Administration and 
                Federal Highway Administration, Department of 
                Transportation (Parts 1200--1299)
       III  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 1300--1399)

                Title 24--Housing and Urban Development

            Subtitle A--Office of the Secretary, Department of 
                Housing and Urban Development (Parts 0--99)
            Subtitle B--Regulations Relating to Housing and Urban 
                Development
         I  Office of Assistant Secretary for Equal Opportunity, 
                Department of Housing and Urban Development (Parts 
                100--199)
        II  Office of Assistant Secretary for Housing-Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 200--299)
       III  Government National Mortgage Association, Department 
                of Housing and Urban Development (Parts 300--399)
        IV  Office of Housing and Office of Multifamily Housing 
                Assistance Restructuring, Department of Housing 
                and Urban Development (Parts 400--499)
         V  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 500--599)
        VI  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 600--699) [Reserved]
       VII  Office of the Secretary, Department of Housing and 
                Urban Development (Housing Assistance Programs and 
                Public and Indian Housing Programs) (Parts 700--
                799)
      VIII  Office of the Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Section 8 Housing Assistance 
                Programs, Section 202 Direct Loan Program, Section 
                202 Supportive Housing for the Elderly Program and 
                Section 811 Supportive Housing for Persons With 
                Disabilities Program) (Parts 800--899)
        IX  Office of Assistant Secretary for Public and Indian 
                Housing, Department of Housing and Urban 
                Development (Parts 900--999)
         X  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Interstate Land Sales 
                Registration Program) (Parts 1700--1799)
       XII  Office of Inspector General, Department of Housing and 
                Urban Development (Parts 2000--2099)
        XX  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 3200--3899)
       XXV  Neighborhood Reinvestment Corporation (Parts 4100--
                4199)

[[Page 391]]

                           Title 25--Indians

         I  Bureau of Indian Affairs, Department of the Interior 
                (Parts 1--299)
        II  Indian Arts and Crafts Board, Department of the 
                Interior (Parts 300--399)
       III  National Indian Gaming Commission, Department of the 
                Interior (Parts 500--599)
        IV  Office of Navajo and Hopi Indian Relocation (Parts 
                700--799)
         V  Bureau of Indian Affairs, Department of the Interior, 
                and Indian Health Service, Department of Health 
                and Human Services (Part 900)
        VI  Office of the Assistant Secretary-Indian Affairs, 
                Department of the Interior (Part 1001)
       VII  Office of the Special Trustee for American Indians, 
                Department of the Interior (Part 1200)

                      Title 26--Internal Revenue

         I  Internal Revenue Service, Department of the Treasury 
                (Parts 1--799)

           Title 27--Alcohol, Tobacco Products and Firearms

         I  Bureau of Alcohol, Tobacco and Firearms, Department of 
                the Treasury (Parts 1--299)

                   Title 28--Judicial Administration

         I  Department of Justice (Parts 0--199)
       III  Federal Prison Industries, Inc., Department of Justice 
                (Parts 300--399)
         V  Bureau of Prisons, Department of Justice (Parts 500--
                599)
        VI  Offices of Independent Counsel, Department of Justice 
                (Parts 600--699)
       VII  Office of Independent Counsel (Parts 700--799)

                            Title 29--Labor

            Subtitle A--Office of the Secretary of Labor (Parts 
                0--99)
            Subtitle B--Regulations Relating to Labor
         I  National Labor Relations Board (Parts 100--199)
        II  Office of Labor-Management Standards, Department of 
                Labor (Parts 200--299)
       III  National Railroad Adjustment Board (Parts 300--399)
        IV  Office of Labor-Management Standards, Department of 
                Labor (Parts 400--499)
         V  Wage and Hour Division, Department of Labor (Parts 
                500--899)
        IX  Construction Industry Collective Bargaining Commission 
                (Parts 900--999)
         X  National Mediation Board (Parts 1200--1299)

[[Page 392]]

       XII  Federal Mediation and Conciliation Service (Parts 
                1400--1499)
       XIV  Equal Employment Opportunity Commission (Parts 1600--
                1699)
      XVII  Occupational Safety and Health Administration, 
                Department of Labor (Parts 1900--1999)
        XX  Occupational Safety and Health Review Commission 
                (Parts 2200--2499)
       XXV  Pension and Welfare Benefits Administration, 
                Department of Labor (Parts 2500--2599)
     XXVII  Federal Mine Safety and Health Review Commission 
                (Parts 2700--2799)
        XL  Pension Benefit Guaranty Corporation (Parts 4000--
                4999)

                      Title 30--Mineral Resources

         I  Mine Safety and Health Administration, Department of 
                Labor (Parts 1--199)
        II  Minerals Management Service, Department of the 
                Interior (Parts 200--299)
       III  Board of Surface Mining and Reclamation Appeals, 
                Department of the Interior (Parts 300--399)
        IV  Geological Survey, Department of the Interior (Parts 
                400--499)
        VI  Bureau of Mines, Department of the Interior (Parts 
                600--699)
       VII  Office of Surface Mining Reclamation and Enforcement, 
                Department of the Interior (Parts 700--999)

                 Title 31--Money and Finance: Treasury

            Subtitle A--Office of the Secretary of the Treasury 
                (Parts 0--50)
            Subtitle B--Regulations Relating to Money and Finance
         I  Monetary Offices, Department of the Treasury (Parts 
                51--199)
        II  Fiscal Service, Department of the Treasury (Parts 
                200--399)
        IV  Secret Service, Department of the Treasury (Parts 
                400--499)
         V  Office of Foreign Assets Control, Department of the 
                Treasury (Parts 500--599)
        VI  Bureau of Engraving and Printing, Department of the 
                Treasury (Parts 600--699)
       VII  Federal Law Enforcement Training Center, Department of 
                the Treasury (Parts 700--799)
      VIII  Office of International Investment, Department of the 
                Treasury (Parts 800--899)

                      Title 32--National Defense

            Subtitle A--Department of Defense
         I  Office of the Secretary of Defense (Parts 1--399)
         V  Department of the Army (Parts 400--699)
        VI  Department of the Navy (Parts 700--799)

[[Page 393]]

       VII  Department of the Air Force (Parts 800--1099)
            Subtitle B--Other Regulations Relating to National 
                Defense
       XII  Defense Logistics Agency (Parts 1200--1299)
       XVI  Selective Service System (Parts 1600--1699)
     XVIII  National Counterintelligence Center (Parts 1800--1899)
       XIX  Central Intelligence Agency (Parts 1900--1999)
        XX  Information Security Oversight Office, National 
                Archives and Records Administration (Parts 2000--
                2099)
       XXI  National Security Council (Parts 2100--2199)
      XXIV  Office of Science and Technology Policy (Parts 2400--
                2499)
     XXVII  Office for Micronesian Status Negotiations (Parts 
                2700--2799)
    XXVIII  Office of the Vice President of the United States 
                (Parts 2800--2899)

               Title 33--Navigation and Navigable Waters

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Corps of Engineers, Department of the Army (Parts 
                200--399)
        IV  Saint Lawrence Seaway Development Corporation, 
                Department of Transportation (Parts 400--499)

                          Title 34--Education

            Subtitle A--Office of the Secretary, Department of 
                Education (Parts 1--99)
            Subtitle B--Regulations of the Offices of the 
                Department of Education
         I  Office for Civil Rights, Department of Education 
                (Parts 100--199)
        II  Office of Elementary and Secondary Education, 
                Department of Education (Parts 200--299)
       III  Office of Special Education and Rehabilitative 
                Services, Department of Education (Parts 300--399)
        IV  Office of Vocational and Adult Education, Department 
                of Education (Parts 400--499)
         V  Office of Bilingual Education and Minority Languages 
                Affairs, Department of Education (Parts 500--599)
        VI  Office of Postsecondary Education, Department of 
                Education (Parts 600--699)
       VII  Office of Educational Research and Improvement, 
                Department of Education (Parts 700--799)
        XI  National Institute for Literacy (Parts 1100--1199)
            Subtitle C--Regulations Relating to Education
       XII  National Council on Disability (Parts 1200--1299)

                        Title 35--Panama Canal

         I  Panama Canal Regulations (Parts 1--299)

[[Page 394]]

             Title 36--Parks, Forests, and Public Property

         I  National Park Service, Department of the Interior 
                (Parts 1--199)
        II  Forest Service, Department of Agriculture (Parts 200--
                299)
       III  Corps of Engineers, Department of the Army (Parts 
                300--399)
        IV  American Battle Monuments Commission (Parts 400--499)
         V  Smithsonian Institution (Parts 500--599)
       VII  Library of Congress (Parts 700--799)
      VIII  Advisory Council on Historic Preservation (Parts 800--
                899)
        IX  Pennsylvania Avenue Development Corporation (Parts 
                900--999)
         X  Presidio Trust (Parts 1000--1099)
        XI  Architectural and Transportation Barriers Compliance 
                Board (Parts 1100--1199)
       XII  National Archives and Records Administration (Parts 
                1200--1299)
       XIV  Assassination Records Review Board (Parts 1400--1499)
        XV  Oklahoma City National Memorial Trust (Part 1501)

             Title 37--Patents, Trademarks, and Copyrights

         I  Patent and Trademark Office, Department of Commerce 
                (Parts 1--199)
        II  Copyright Office, Library of Congress (Parts 200--299)
        IV  Assistant Secretary for Technology Policy, Department 
                of Commerce (Parts 400--499)
         V  Under Secretary for Technology, Department of Commerce 
                (Parts 500--599)

           Title 38--Pensions, Bonuses, and Veterans' Relief

         I  Department of Veterans Affairs (Parts 0--99)

                       Title 39--Postal Service

         I  United States Postal Service (Parts 1--999)
       III  Postal Rate Commission (Parts 3000--3099)

                  Title 40--Protection of Environment

         I  Environmental Protection Agency (Parts 1--799)
         V  Council on Environmental Quality (Parts 1500--1599)
       VII  Environmental Protection Agency and Department of 
                Defense; Uniform National Discharge Standards for 
                Vessels of the Armed Forces (Parts 1700--1799)

          Title 41--Public Contracts and Property Management

            Subtitle B--Other Provisions Relating to Public 
                Contracts
        50  Public Contracts, Department of Labor (Parts 50-1--50-
                999)

[[Page 395]]

        51  Committee for Purchase From People Who Are Blind or 
                Severely Disabled (Parts 51-1--51-99)
        60  Office of Federal Contract Compliance Programs, Equal 
                Employment Opportunity, Department of Labor (Parts 
                60-1--60-999)
        61  Office of the Assistant Secretary for Veterans 
                Employment and Training, Department of Labor 
                (Parts 61-1--61-999)
            Subtitle C--Federal Property Management Regulations 
                System
       101  Federal Property Management Regulations (Parts 101-1--
                101-99)
       102  Federal Management Regulation (Parts 102-1--102-299)
       105  General Services Administration (Parts 105-1--105-999)
       109  Department of Energy Property Management Regulations 
                (Parts 109-1--109-99)
       114  Department of the Interior (Parts 114-1--114-99)
       115  Environmental Protection Agency (Parts 115-1--115-99)
       128  Department of Justice (Parts 128-1--128-99)
            Subtitle D--Other Provisions Relating to Property 
                Management [Reserved]
            Subtitle E--Federal Information Resources Management 
                Regulations System
       201  Federal Information Resources Management Regulation 
                (Parts 201-1--201-99) [Reserved]
            Subtitle F--Federal Travel Regulation System
       300  General (Parts 300-1--300.99)
       301  Temporary Duty (TDY) Travel Allowances (Parts 301-1--
                301-99)
       302  Relocation Allowances (Parts 302-1--302-99)
       303  Payment of Expenses Connected with the Death of 
                Certain Employees (Part 303-70)
       304  Payment from a Non-Federal Source for Travel Expenses 
                (Parts 304-1--304-99)

                        Title 42--Public Health

         I  Public Health Service, Department of Health and Human 
                Services (Parts 1--199)
        IV  Health Care Financing Administration, Department of 
                Health and Human Services (Parts 400--499)
         V  Office of Inspector General-Health Care, Department of 
                Health and Human Services (Parts 1000--1999)

                   Title 43--Public Lands: Interior

            Subtitle A--Office of the Secretary of the Interior 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Lands
         I  Bureau of Reclamation, Department of the Interior 
                (Parts 200--499)
        II  Bureau of Land Management, Department of the Interior 
                (Parts 1000--9999)

[[Page 396]]

       III  Utah Reclamation Mitigation and Conservation 
                Commission (Parts 10000--10005)

             Title 44--Emergency Management and Assistance

         I  Federal Emergency Management Agency (Parts 0--399)
        IV  Department of Commerce and Department of 
                Transportation (Parts 400--499)

                       Title 45--Public Welfare

            Subtitle A--Department of Health and Human Services 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Welfare
        II  Office of Family Assistance (Assistance Programs), 
                Administration for Children and Families, 
                Department of Health and Human Services (Parts 
                200--299)
       III  Office of Child Support Enforcement (Child Support 
                Enforcement Program), Administration for Children 
                and Families, Department of Health and Human 
                Services (Parts 300--399)
        IV  Office of Refugee Resettlement, Administration for 
                Children and Families Department of Health and 
                Human Services (Parts 400--499)
         V  Foreign Claims Settlement Commission of the United 
                States, Department of Justice (Parts 500--599)
        VI  National Science Foundation (Parts 600--699)
       VII  Commission on Civil Rights (Parts 700--799)
      VIII  Office of Personnel Management (Parts 800--899)
         X  Office of Community Services, Administration for 
                Children and Families, Department of Health and 
                Human Services (Parts 1000--1099)
        XI  National Foundation on the Arts and the Humanities 
                (Parts 1100--1199)
       XII  Corporation for National and Community Service (Parts 
                1200--1299)
      XIII  Office of Human Development Services, Department of 
                Health and Human Services (Parts 1300--1399)
       XVI  Legal Services Corporation (Parts 1600--1699)
      XVII  National Commission on Libraries and Information 
                Science (Parts 1700--1799)
     XVIII  Harry S. Truman Scholarship Foundation (Parts 1800--
                1899)
       XXI  Commission on Fine Arts (Parts 2100--2199)
     XXIII  Arctic Research Commission (Part 2301)
      XXIV  James Madison Memorial Fellowship Foundation (Parts 
                2400--2499)
       XXV  Corporation for National and Community Service (Parts 
                2500--2599)

[[Page 397]]

                          Title 46--Shipping

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Maritime Administration, Department of Transportation 
                (Parts 200--399)
       III  Coast Guard (Great Lakes Pilotage), Department of 
                Transportation (Parts 400--499)
        IV  Federal Maritime Commission (Parts 500--599)

                      Title 47--Telecommunication

         I  Federal Communications Commission (Parts 0--199)
        II  Office of Science and Technology Policy and National 
                Security Council (Parts 200--299)
       III  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                300--399)

           Title 48--Federal Acquisition Regulations System

         1  Federal Acquisition Regulation (Parts 1--99)
         2  Department of Defense (Parts 200--299)
         3  Department of Health and Human Services (Parts 300--
                399)
         4  Department of Agriculture (Parts 400--499)
         5  General Services Administration (Parts 500--599)
         6  Department of State (Parts 600--699)
         7  United States Agency for International Development 
                (Parts 700--799)
         8  Department of Veterans Affairs (Parts 800--899)
         9  Department of Energy (Parts 900--999)
        10  Department of the Treasury (Parts 1000--1099)
        12  Department of Transportation (Parts 1200--1299)
        13  Department of Commerce (Parts 1300--1399)
        14  Department of the Interior (Parts 1400--1499)
        15  Environmental Protection Agency (Parts 1500--1599)
        16  Office of Personnel Management Federal Employees 
                Health Benefits Acquisition Regulation (Parts 
                1600--1699)
        17  Office of Personnel Management (Parts 1700--1799)
        18  National Aeronautics and Space Administration (Parts 
                1800--1899)
        19  Broadcasting Board of Governors (Parts 1900--1999)
        20  Nuclear Regulatory Commission (Parts 2000--2099)
        21  Office of Personnel Management, Federal Employees 
                Group Life Insurance Federal Acquisition 
                Regulation (Parts 2100--2199)
        23  Social Security Administration (Parts 2300--2399)
        24  Department of Housing and Urban Development (Parts 
                2400--2499)
        25  National Science Foundation (Parts 2500--2599)
        28  Department of Justice (Parts 2800--2899)
        29  Department of Labor (Parts 2900--2999)

[[Page 398]]

        34  Department of Education Acquisition Regulation (Parts 
                3400--3499)
        35  Panama Canal Commission (Parts 3500--3599)
        44  Federal Emergency Management Agency (Parts 4400--4499)
        51  Department of the Army Acquisition Regulations (Parts 
                5100--5199)
        52  Department of the Navy Acquisition Regulations (Parts 
                5200--5299)
        53  Department of the Air Force Federal Acquisition 
                Regulation Supplement (Parts 5300--5399)
        54  Defense Logistics Agency, Department of Defense (Part 
                5452)
        57  African Development Foundation (Parts 5700--5799)
        61  General Services Administration Board of Contract 
                Appeals (Parts 6100--6199)
        63  Department of Transportation Board of Contract Appeals 
                (Parts 6300--6399)
        99  Cost Accounting Standards Board, Office of Federal 
                Procurement Policy, Office of Management and 
                Budget (Parts 9900--9999)

                       Title 49--Transportation

            Subtitle A--Office of the Secretary of Transportation 
                (Parts 1--99)
            Subtitle B--Other Regulations Relating to 
                Transportation
         I  Research and Special Programs Administration, 
                Department of Transportation (Parts 100--199)
        II  Federal Railroad Administration, Department of 
                Transportation (Parts 200--299)
       III  Federal Motor Carrier Safety Administration, 
                Department of Transportation (Parts 300--399)
        IV  Coast Guard, Department of Transportation (Parts 400--
                499)
         V  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 500--599)
        VI  Federal Transit Administration, Department of 
                Transportation (Parts 600--699)
       VII  National Railroad Passenger Corporation (AMTRAK) 
                (Parts 700--799)
      VIII  National Transportation Safety Board (Parts 800--999)
         X  Surface Transportation Board, Department of 
                Transportation (Parts 1000--1399)
        XI  Bureau of Transportation Statistics, Department of 
                Transportation (Parts 1400--1499)

                   Title 50--Wildlife and Fisheries

         I  United States Fish and Wildlife Service, Department of 
                the Interior (Parts 1--199)

[[Page 399]]

        II  National Marine Fisheries Service, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 200--299)
       III  International Fishing and Related Activities (Parts 
                300--399)
        IV  Joint Regulations (United States Fish and Wildlife 
                Service, Department of the Interior and National 
                Marine Fisheries Service, National Oceanic and 
                Atmospheric Administration, Department of 
                Commerce); Endangered Species Committee 
                Regulations (Parts 400--499)
         V  Marine Mammal Commission (Parts 500--599)
        VI  Fishery Conservation and Management, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 600--699)

                      CFR Index and Finding Aids

            Subject/Agency Index
            List of Agency Prepared Indexes
            Parallel Tables of Statutory Authorities and Rules
            List of CFR Titles, Chapters, Subchapters, and Parts
            Alphabetical List of Agencies Appearing in the CFR



[[Page 401]]





           Alphabetical List of Agencies Appearing in the CFR




                      (Revised as of June 23, 2000)

                                                  CFR Title, Subtitle or 
                     Agency                               Chapter

Administrative Committee of the Federal Register  1, I
Advanced Research Projects Agency                 32, I
Advisory Commission on Intergovernmental          5, VII
     Relations
Advisory Council on Historic Preservation         36, VIII
African Development Foundation                    22, XV
  Federal Acquisition Regulation                  48, 57
Agency for International Development, United      22, II
     States
  Federal Acquisition Regulation                  48, 7
Agricultural Marketing Service                    7, I, IX, X, XI
Agricultural Research Service                     7, V
Agriculture Department                            5, LXXIII
  Agricultural Marketing Service                  7, I, IX, X, XI
  Agricultural Research Service                   7, V
  Animal and Plant Health Inspection Service      7, III; 9, I
  Chief Financial Officer, Office of              7, XXX
  Commodity Credit Corporation                    7, XIV
  Cooperative State Research, Education, and      7, XXXIV
       Extension Service
  Economic Research Service                       7, XXXVII
  Energy, Office of                               7, XXIX
  Environmental Quality, Office of                7, XXXI
  Farm Service Agency                             7, VII, XVIII
  Federal Acquisition Regulation                  48, 4
  Federal Crop Insurance Corporation              7, IV
  Food and Nutrition Service                      7, II
  Food Safety and Inspection Service              9, III
  Foreign Agricultural Service                    7, XV
  Forest Service                                  36, II
  Grain Inspection, Packers and Stockyards        7, VIII; 9, II
       Administration
  Information Resources Management, Office of     7, XXVII
  Inspector General, Office of                    7, XXVI
  National Agricultural Library                   7, XLI
  National Agricultural Statistics Service        7, XXXVI
  Natural Resources Conservation Service          7, VI
  Operations, Office of                           7, XXVIII
  Procurement and Property Management, Office of  7, XXXII
  Rural Business-Cooperative Service              7, XVIII, XLII
  Rural Development Administration                7, XLII
  Rural Housing Service                           7, XVIII, XXXV
  Rural Telephone Bank                            7, XVI
  Rural Utilities Service                         7, XVII, XVIII, XLII
  Secretary of Agriculture, Office of             7, Subtitle A
  Transportation, Office of                       7, XXXIII
  World Agricultural Outlook Board                7, XXXVIII
Air Force Department                              32, VII
  Federal Acquisition Regulation Supplement       48, 53
Alcohol, Tobacco and Firearms, Bureau of          27, I
AMTRAK                                            49, VII
American Battle Monuments Commission              36, IV
American Indians, Office of the Special Trustee   25, VII
Animal and Plant Health Inspection Service        7, III; 9, I
Appalachian Regional Commission                   5, IX
Architectural and Transportation Barriers         36, XI
   Compliance Board
[[Page 402]]

Arctic Research Commission                        45, XXIII
Armed Forces Retirement Home                      5, XI
Army Department                                   32, V
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 51
Assassination Records Review Board                36, XIV
Benefits Review Board                             20, VII
Bilingual Education and Minority Languages        34, V
     Affairs, Office of
Blind or Severely Disabled, Committee for         41, 51
     Purchase From People Who Are
Board for International Broadcasting              22, XIII
Broadcasting Board of Governors                   22, V
  Federal Acquisition Regulation                  48, 19
Census Bureau                                     15, I
Central Intelligence Agency                       32, XIX
Chief Financial Officer, Office of                7, XXX
Child Support Enforcement, Office of              45, III
Children and Families, Administration for         45, II, III, IV, X
Civil Rights, Commission on                       45, VII
Civil Rights, Office for                          34, I
Coast Guard                                       33, I; 46, I; 49, IV
Coast Guard (Great Lakes Pilotage)                46, III
Commerce Department                               44, IV
  Census Bureau                                   15, I
  Economic Affairs, Under Secretary               37, V
  Economic Analysis, Bureau of                    15, VIII
  Economic Development Administration             13, III
  Emergency Management and Assistance             44, IV
  Export Administration, Bureau of                15, VII
  Federal Acquisition Regulation                  48, 13
  Fishery Conservation and Management             50, VI
  Foreign-Trade Zones Board                       15, IV
  International Trade Administration              15, III; 19, III
  National Institute of Standards and Technology  15, II
  National Marine Fisheries Service               50, II, IV, VI
  National Oceanic and Atmospheric                15, IX; 50, II, III, IV, 
       Administration                             VI
  National Telecommunications and Information     15, XXIII; 47, III
       Administration
  National Weather Service                        15, IX
  Patent and Trademark Office                     37, I
  Productivity, Technology and Innovation,        37, IV
       Assistant Secretary for
  Secretary of Commerce, Office of                15, Subtitle A
  Technology, Under Secretary for                 37, V
  Technology Administration                       15, XI
  Technology Policy, Assistant Secretary for      37, IV
Commercial Space Transportation                   14, III
Commodity Credit Corporation                      7, XIV
Commodity Futures Trading Commission              5, XLI; 17, I
Community Planning and Development, Office of     24, V, VI
     Assistant Secretary for
Community Services, Office of                     45, X
Comptroller of the Currency                       12, I
Construction Industry Collective Bargaining       29, IX
     Commission
Consumer Product Safety Commission                5, LXXI; 16, II
Cooperative State Research, Education, and        7, XXXIV
     Extension Service
Copyright Office                                  37, II
Corporation for National and Community Service    45, XII, XXV
Cost Accounting Standards Board                   48, 99
Council on Environmental Quality                  40, V
Customs Service, United States                    19, I
Defense Contract Audit Agency                     32, I
Defense Department                                5, XXVI; 32, Subtitle A; 
                                                  40, VII
  Advanced Research Projects Agency               32, I
  Air Force Department                            32, VII

[[Page 403]]

  Army Department                                 32, V; 33, II; 36, III, 
                                                  48, 51
  Defense Intelligence Agency                     32, I
  Defense Logistics Agency                        32, I, XII; 48, 54
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 2
  National Imagery and Mapping Agency             32, I
  Navy Department                                 32, VI; 48, 52
  Secretary of Defense, Office of                 32, I
Defense Contract Audit Agency                     32, I
Defense Intelligence Agency                       32, I
Defense Logistics Agency                          32, XII; 48, 54
Defense Nuclear Facilities Safety Board           10, XVII
Delaware River Basin Commission                   18, III
Drug Enforcement Administration                   21, II
East-West Foreign Trade Board                     15, XIII
Economic Affairs, Under Secretary                 37, V
Economic Analysis, Bureau of                      15, VIII
Economic Development Administration               13, III
Economic Research Service                         7, XXXVII
Education, Department of                          5, LIII
  Bilingual Education and Minority Languages      34, V
       Affairs, Office of
  Civil Rights, Office for                        34, I
  Educational Research and Improvement, Office    34, VII
       of
  Elementary and Secondary Education, Office of   34, II
  Federal Acquisition Regulation                  48, 34
  Postsecondary Education, Office of              34, VI
  Secretary of Education, Office of               34, Subtitle A
  Special Education and Rehabilitative Services,  34, III
       Office of
  Vocational and Adult Education, Office of       34, IV
Educational Research and Improvement, Office of   34, VII
Elementary and Secondary Education, Office of     34, II
Emergency Oil and Gas Guaranteed Loan Board       13, V
Emergency Steel Guarantee Loan Board              13, IV
Employees' Compensation Appeals Board             20, IV
Employees Loyalty Board                           5, V
Employment and Training Administration            20, V
Employment Standards Administration               20, VI
Endangered Species Committee                      50, IV
Energy, Department of                             5, XXIII; 10, II, III, X
  Federal Acquisition Regulation                  48, 9
  Federal Energy Regulatory Commission            5, XXIV; 18, I
  Property Management Regulations                 41, 109
Energy, Office of                                 7, XXIX
Engineers, Corps of                               33, II; 36, III
Engraving and Printing, Bureau of                 31, VI
Environmental Protection Agency                   5, LIV; 40, I, VII
  Federal Acquisition Regulation                  48, 15
  Property Management Regulations                 41, 115
Environmental Quality, Office of                  7, XXXI
Equal Employment Opportunity Commission           5, LXII; 29, XIV
Equal Opportunity, Office of Assistant Secretary  24, I
     for
Executive Office of the President                 3, I
  Administration, Office of                       5, XV
  Environmental Quality, Council on               40, V
  Management and Budget, Office of                25, III, LXXVII; 48, 99
  National Drug Control Policy, Office of         21, III
  National Security Council                       32, XXI; 47, 2
  Presidential Documents                          3
  Science and Technology Policy, Office of        32, XXIV; 47, II
  Trade Representative, Office of the United      15, XX
       States
Export Administration, Bureau of                  15, VII
Export-Import Bank of the United States           5, LII; 12, IV
Family Assistance, Office of                      45, II
Farm Credit Administration                        5, XXXI; 12, VI
Farm Credit System Insurance Corporation          5, XXX; 12, XIV

[[Page 404]]

Farm Service Agency                               7, VII, XVIII
Federal Acquisition Regulation                    48, 1
Federal Aviation Administration                   14, I
  Commercial Space Transportation                 14, III
Federal Claims Collection Standards               4, II
Federal Communications Commission                 5, XXIX; 47, I
Federal Contract Compliance Programs, Office of   41, 60
Federal Crop Insurance Corporation                7, IV
Federal Deposit Insurance Corporation             5, XXII; 12, III
Federal Election Commission                       11, I
Federal Emergency Management Agency               44, I
  Federal Acquisition Regulation                  48, 44
Federal Employees Group Life Insurance Federal    48, 21
     Acquisition Regulation
Federal Employees Health Benefits Acquisition     48, 16
     Regulation
Federal Energy Regulatory Commission              5, XXIV; 18, I
Federal Financial Institutions Examination        12, XI
     Council
Federal Financing Bank                            12, VIII
Federal Highway Administration                    23, I, II
Federal Home Loan Mortgage Corporation            1, IV
Federal Housing Enterprise Oversight Office       12, XVII
Federal Housing Finance Board                     12, IX
Federal Labor Relations Authority, and General    5, XIV; 22, XIV
     Counsel of the Federal Labor Relations 
     Authority
Federal Law Enforcement Training Center           31, VII
Federal Management Regulation                     41, 102
Federal Maritime Commission                       46, IV
Federal Mediation and Conciliation Service        29, XII
Federal Mine Safety and Health Review Commission  5, LXXIV; 29, XXVII
Federal Motor Carrier Safety Administration       49, III
Federal Prison Industries, Inc.                   28, III
Federal Procurement Policy Office                 48, 99
Federal Property Management Regulations           41, 101
Federal Railroad Administration                   49, II
Federal Register, Administrative Committee of     1, I
Federal Register, Office of                       1, II
Federal Reserve System                            12, II
  Board of Governors                              5, LVIII
Federal Retirement Thrift Investment Board        5, VI, LXXVI
Federal Service Impasses Panel                    5, XIV
Federal Trade Commission                          5, XLVII; 16, I
Federal Transit Administration                    49, VI
Federal Travel Regulation System                  41, Subtitle F
Fine Arts, Commission on                          45, XXI
Fiscal Service                                    31, II
Fish and Wildlife Service, United States          50, I, IV
Fishery Conservation and Management               50, VI
Food and Drug Administration                      21, I
Food and Nutrition Service                        7, II
Food Safety and Inspection Service                9, III
Foreign Agricultural Service                      7, XV
Foreign Assets Control, Office of                 31, V
Foreign Claims Settlement Commission of the       45, V
     United States
Foreign Service Grievance Board                   22, IX
Foreign Service Impasse Disputes Panel            22, XIV
Foreign Service Labor Relations Board             22, XIV
Foreign-Trade Zones Board                         15, IV
Forest Service                                    36, II
General Accounting Office                         4, I, II
General Services Administration                   5, LVII; 41, 105
  Contract Appeals, Board of                      48, 61
  Federal Acquisition Regulation                  48, 5
  Federal Management Regulation                   41, 102
  Federal Property Management Regulations         41, 101
  Federal Travel Regulation System                41, Subtitle F
  General                                         41, 300
  Payment From a Non-Federal Source for Travel    41, 304
     Expenses
[[Page 405]]

  Payment of Expenses Connected With the Death    41, 303
       of Certain Employees
  Relocation Allowances                           41, 302
  Temporary Duty (TDY) Travel Allowances          41, 301
Geological Survey                                 30, IV
Government Ethics, Office of                      5, XVI
Government National Mortgage Association          24, III
Grain Inspection, Packers and Stockyards          7, VIII; 9, II
     Administration
Harry S. Truman Scholarship Foundation            45, XVIII
Health and Human Services, Department of          5, XLV; 45, Subtitle A
  Child Support Enforcement, Office of            45, III
  Children and Families, Administration for       45, II, III, IV, X
  Community Services, Office of                   45, X
  Family Assistance, Office of                    45, II
  Federal Acquisition Regulation                  48, 3
  Food and Drug Administration                    21, I
  Health Care Financing Administration            42, IV
  Human Development Services, Office of           45, XIII
  Indian Health Service                           25, V
  Inspector General (Health Care), Office of      42, V
  Public Health Service                           42, I
  Refugee Resettlement, Office of                 45, IV
Health Care Financing Administration              42, IV
Housing and Urban Development, Department of      5, LXV; 24, Subtitle B
  Community Planning and Development, Office of   24, V, VI
       Assistant Secretary for
  Equal Opportunity, Office of Assistant          24, I
       Secretary for
  Federal Acquisition Regulation                  48, 24
  Federal Housing Enterprise Oversight, Office    12, XVII
       of
  Government National Mortgage Association        24, III
  Housing--Federal Housing Commissioner, Office   24, II, VIII, X, XX
       of Assistant Secretary for
  Inspector General, Office of                    24, XII
  Multifamily Housing Assistance Restructuring,   24, IV
       Office of
  Public and Indian Housing, Office of Assistant  24, IX
       Secretary for
  Secretary, Office of                            24, Subtitle A, VII
Housing--Federal Housing Commissioner, Office of  24, II, VIII, X, XX
     Assistant Secretary for
Human Development Services, Office of             45, XIII
Immigration and Naturalization Service            8, I
Independent Counsel, Office of                    28, VII
Indian Affairs, Bureau of                         25, I, V
Indian Affairs, Office of the Assistant           25, VI
     Secretary
Indian Arts and Crafts Board                      25, II
Indian Health Service                             25, V
Information Resources Management, Office of       7, XXVII
Information Security Oversight Office, National   32, XX
     Archives and Records Administration
Inspector General
  Agriculture Department                          7, XXVI
  Health and Human Services Department            42, V
  Housing and Urban Development Department        24, XII
Institute of Peace, United States                 22, XVII
Inter-American Foundation                         5, LXIII; 22, X
Intergovernmental Relations, Advisory Commission  5, VII
     on
Interior Department
  American Indians, Office of the Special         25, VII
       Trustee
  Endangered Species Committee                    50, IV
  Federal Acquisition Regulation                  48, 14
  Federal Property Management Regulations System  41, 114
  Fish and Wildlife Service, United States        50, I, IV
  Geological Survey                               30, IV
  Indian Affairs, Bureau of                       25, I, V
  Indian Affairs, Office of the Assistant         25, VI
       Secretary
  Indian Arts and Crafts Board                    25, II
  Land Management, Bureau of                      43, II
  Minerals Management Service                     30, II

[[Page 406]]

  Mines, Bureau of                                30, VI
  National Indian Gaming Commission               25, III
  National Park Service                           36, I
  Reclamation, Bureau of                          43, I
  Secretary of the Interior, Office of            43, Subtitle A
  Surface Mining and Reclamation Appeals, Board   30, III
       of
  Surface Mining Reclamation and Enforcement,     30, VII
       Office of
Internal Revenue Service                          26, I
International Boundary and Water Commission,      22, XI
     United States and Mexico, United States 
     Section
International Development, United States Agency   22, II
     for
  Federal Acquisition Regulation                  48, 7
International Development Cooperation Agency,     22, XII
     United States
International Fishing and Related Activities      50, III
International Investment, Office of               31, VIII
International Joint Commission, United States     22, IV
     and Canada
International Organizations Employees Loyalty     5, V
     Board
International Trade Administration                15, III; 19, III
International Trade Commission, United States     19, II
Interstate Commerce Commission                    5, XL
James Madison Memorial Fellowship Foundation      45, XXIV
Japan-United States Friendship Commission         22, XVI
Joint Board for the Enrollment of Actuaries       20, VIII
Justice Department                                5, XXVIII; 28, I
  Drug Enforcement Administration                 21, II
  Federal Acquisition Regulation                  48, 28
  Federal Claims Collection Standards             4, II
  Federal Prison Industries, Inc.                 28, III
  Foreign Claims Settlement Commission of the     45, V
       United States
  Immigration and Naturalization Service          8, I
  Offices of Independent Counsel                  28, VI
  Prisons, Bureau of                              28, V
  Property Management Regulations                 41, 128
Labor Department                                  5, XLII
  Benefits Review Board                           20, VII
  Employees' Compensation Appeals Board           20, IV
  Employment and Training Administration          20, V
  Employment Standards Administration             20, VI
  Federal Acquisition Regulation                  48, 29
  Federal Contract Compliance Programs, Office    41, 60
       of
  Federal Procurement Regulations System          41, 50
  Labor-Management Standards, Office of           29, II, IV
  Mine Safety and Health Administration           30, I
  Occupational Safety and Health Administration   29, XVII
  Pension and Welfare Benefits Administration     29, XXV
  Public Contracts                                41, 50
  Secretary of Labor, Office of                   29, Subtitle A
  Veterans' Employment and Training, Office of    41, 61; 20, IX
       the Assistant Secretary for
  Wage and Hour Division                          29, V
  Workers' Compensation Programs, Office of       20, I
Labor-Management Standards, Office of             29, II, IV
Land Management, Bureau of                        43, II
Legal Services Corporation                        45, XVI
Library of Congress                               36, VII
  Copyright Office                                37, II
Management and Budget, Office of                  5, III, LXXVII; 48, 99
Marine Mammal Commission                          50, V
Maritime Administration                           46, II
Merit Systems Protection Board                    5, II
Micronesian Status Negotiations, Office for       32, XXVII
Mine Safety and Health Administration             30, I
Minerals Management Service                       30, II
Mines, Bureau of                                  30, VI
Minority Business Development Agency              15, XIV

[[Page 407]]

Miscellaneous Agencies                            1, IV
Monetary Offices                                  31, I
Multifamily Housing Assistance Restructuring,     24, IV
     Office of
National Aeronautics and Space Administration     5, LIX; 14, V
  Federal Acquisition Regulation                  48, 18
National Agricultural Library                     7, XLI
National Agricultural Statistics Service          7, XXXVI
National and Community Service, Corporation for   45, XII, XXV
National Archives and Records Administration      5, LXVI; 36, XII
  Information Security Oversight Office           32, XX
National Bureau of Standards                      15, II
National Capital Planning Commission              1, IV
National Commission for Employment Policy         1, IV
National Commission on Libraries and Information  45, XVII
     Science
National Council on Disability                    34, XII
National Counterintelligence Center               32, XVIII
National Credit Union Administration              12, VII
National Drug Control Policy, Office of           21, III
National Foundation on the Arts and the           45, XI
     Humanities
National Highway Traffic Safety Administration    23, II, III; 49, V
National Imagery and Mapping Agency               32, I
National Indian Gaming Commission                 25, III
National Institute for Literacy                   34, XI
National Institute of Standards and Technology    15, II
National Labor Relations Board                    5, LXI; 29, I
National Marine Fisheries Service                 50, II, IV, VI
National Mediation Board                          29, X
National Oceanic and Atmospheric Administration   15, IX; 50, II, III, IV, 
                                                  VI
National Park Service                             36, I
National Railroad Adjustment Board                29, III
National Railroad Passenger Corporation (AMTRAK)  49, VII
National Science Foundation                       5, XLIII; 45, VI
  Federal Acquisition Regulation                  48, 25
National Security Council                         32, XXI
National Security Council and Office of Science   47, II
     and Technology Policy
National Telecommunications and Information       15, XXIII; 47, III
     Administration
National Transportation Safety Board              49, VIII
National Weather Service                          15, IX
Natural Resources Conservation Service            7, VI
Navajo and Hopi Indian Relocation, Office of      25, IV
Navy Department                                   32, VI
  Federal Acquisition Regulation                  48, 52
Neighborhood Reinvestment Corporation             24, XXV
Northeast Dairy Compact Commission                7, XIII
Northeast Interstate Low-Level Radioactive Waste  10, XVIII
     Commission
Nuclear Regulatory Commission                     5, XLVIII; 10, I
  Federal Acquisition Regulation                  48, 20
Occupational Safety and Health Administration     29, XVII
Occupational Safety and Health Review Commission  29, XX
Offices of Independent Counsel                    28, VI
Oklahoma City National Memorial Trust             36, XV
Operations Office                                 7, XXVIII
Overseas Private Investment Corporation           5, XXXIII; 22, VII
Panama Canal Commission                           48, 35
Panama Canal Regulations                          35, I
Patent and Trademark Office                       37, I
Payment From a Non-Federal Source for Travel      41, 304
     Expenses
Payment of Expenses Connected With the Death of   41, 303
     Certain Employees
Peace Corps                                       22, III
Pennsylvania Avenue Development Corporation       36, IX
Pension and Welfare Benefits Administration       29, XXV
Pension Benefit Guaranty Corporation              29, XL
Personnel Management, Office of                   5, I, XXXV; 45, VIII

[[Page 408]]

  Federal Acquisition Regulation                  48, 17
  Federal Employees Group Life Insurance Federal  48, 21
       Acquisition Regulation
  Federal Employees Health Benefits Acquisition   48, 16
       Regulation
Postal Rate Commission                            5, XLVI; 39, III
Postal Service, United States                     5, LX; 39, I
Postsecondary Education, Office of                34, VI
President's Commission on White House             1, IV
     Fellowships
Presidential Documents                            3
Presidio Trust                                    36, X
Prisons, Bureau of                                28, V
Procurement and Property Management, Office of    7, XXXII
Productivity, Technology and Innovation,          37, IV
     Assistant Secretary
Public Contracts, Department of Labor             41, 50
Public and Indian Housing, Office of Assistant    24, IX
     Secretary for
Public Health Service                             42, I
Railroad Retirement Board                         20, II
Reclamation, Bureau of                            43, I
Refugee Resettlement, Office of                   45, IV
Regional Action Planning Commissions              13, V
Relocation Allowances                             41, 302
Research and Special Programs Administration      49, I
Rural Business-Cooperative Service                7, XVIII, XLII
Rural Development Administration                  7, XLII
Rural Housing Service                             7, XVIII, XXXV
Rural Telephone Bank                              7, XVI
Rural Utilities Service                           7, XVII, XVIII, XLII
Saint Lawrence Seaway Development Corporation     33, IV
Science and Technology Policy, Office of          32, XXIV
Science and Technology Policy, Office of, and     47, II
     National Security Council
Secret Service                                    31, IV
Securities and Exchange Commission                17, II
Selective Service System                          32, XVI
Small Business Administration                     13, I
Smithsonian Institution                           36, V
Social Security Administration                    20, III; 48, 23
Soldiers' and Airmen's Home, United States        5, XI
Special Counsel, Office of                        5, VIII
Special Education and Rehabilitative Services,    34, III
     Office of
State Department                                  22, I
  Federal Acquisition Regulation                  48, 6
Surface Mining and Reclamation Appeals, Board of  30, III
Surface Mining Reclamation and Enforcement,       30, VII
     Office of
Surface Transportation Board                      49, X
Susquehanna River Basin Commission                18, VIII
Technology Administration                         15, XI
Technology Policy, Assistant Secretary for        37, IV
Technology, Under Secretary for                   37, V
Tennessee Valley Authority                        5, LXIX; 18, XIII
Thrift Supervision Office, Department of the      12, V
     Treasury
Trade Representative, United States, Office of    15, XX
Transportation, Department of                     5, L
  Coast Guard                                     33, I; 46, I; 49, IV
  Coast Guard (Great Lakes Pilotage)              46, III
  Commercial Space Transportation                 14, III
  Contract Appeals, Board of                      48, 63
  Emergency Management and Assistance             44, IV
  Federal Acquisition Regulation                  48, 12
  Federal Aviation Administration                 14, I
  Federal Highway Administration                  23, I, II
  Federal Motor Carrier Safety Administration     49, III
  Federal Railroad Administration                 49, II
  Federal Transit Administration                  49, VI
  Maritime Administration                         46, II
  National Highway Traffic Safety Administration  23, II, III; 49, V

[[Page 409]]

  Research and Special Programs Administration    49, I
  Saint Lawrence Seaway Development Corporation   33, IV
  Secretary of Transportation, Office of          14, II; 49, Subtitle A
  Surface Transportation Board                    49, X
  Transportation Statistics Bureau                49, XI
Transportation, Office of                         7, XXXIII
Transportation Statistics Brureau                 49, XI
Travel Allowances, Temporary Duty (TDY)           41, 301
Treasury Department                               5, XXI; 12, XV; 17, IV
  Alcohol, Tobacco and Firearms, Bureau of        27, I
  Community Development Financial Institutions    12, XVIII
       Fund
  Comptroller of the Currency                     12, I
  Customs Service, United States                  19, I
  Engraving and Printing, Bureau of               31, VI
  Federal Acquisition Regulation                  48, 10
  Federal Law Enforcement Training Center         31, VII
  Fiscal Service                                  31, II
  Foreign Assets Control, Office of               31, V
  Internal Revenue Service                        26, I
  International Investment, Office of             31, VIII
  Monetary Offices                                31, I
  Secret Service                                  31, IV
  Secretary of the Treasury, Office of            31, Subtitle A
  Thrift Supervision, Office of                   12, V
Truman, Harry S. Scholarship Foundation           45, XVIII
United States and Canada, International Joint     22, IV
     Commission
United States and Mexico, International Boundary  22, XI
     and Water Commission, United States Section
Utah Reclamation Mitigation and Conservation      43, III
     Commission
Veterans Affairs Department                       38, I
  Federal Acquisition Regulation                  48, 8
Veterans' Employment and Training, Office of the  41, 61; 20, IX
     Assistant Secretary for
Vice President of the United States, Office of    32, XXVIII
Vocational and Adult Education, Office of         34, IV
Wage and Hour Division                            29, V
Water Resources Council                           18, VI
Workers' Compensation Programs, Office of         20, I
World Agricultural Outlook Board                  7, XXXVIII

[[Page 411]]

                                     

                                     



                           Redesignation Table





                           Redesignation Table
------------------------------------------------------------------------
           Old section (26 CFR)                 New section (31 CFR)
------------------------------------------------------------------------
                  General                        Subpart A--General
 
601.901...................................  19.100
601.902...................................  19.105
601.903...................................  19.110
601.904...................................  19.115
             Effect of action                Subpart B--Effect of action
 
601.910...................................  19.200
601.911...................................  19.205
601.912...................................  19.210
601.913...................................  19.215
601.914...................................  19.220
601.915...................................
                                            19.225
 
                 Debarment
                                                Subpart C--Debarment
 
601.920...................................  19.300
601.921...................................  19.305
601.922...................................  19.310
601.923...................................  19.311
601.924...................................  19.312
601.925...................................  19.313
601.926...................................  19.314
601.927...................................  19.315
601.928...................................  19.320
601.929...................................
                                            19.325
 
                Suspensions
                                               Subpart D--Suspensions
 
601.930...................................  19.400
601.931...................................  19.405
601.932...................................  19.410
601.933...................................  19.411
601.934...................................  19.412
601.935...................................  19.413
601.936...................................  19.415
601.937...................................
                                            19.420
 
    Responsibilities of GSA, agency and      Subpart E--Responsibilities
               participants                       of GSA, agency and
                                                     participants
 
601.940...................................  19.500
601.941...................................  19.505
601.942...................................
                                            19.510
 
Appendix A................................  Appendix A to Part 19
Appendix B................................  Appendix B to Part 19
------------------------------------------------------------------------


[[Page 413]]



List of CFR Sections Affected



All changes in this volume of the Code of Federal Regulations which were 
made by documents published in the Federal Register since January 1, 
1986, are enumerated in the following list. Entries indicate the nature 
of the changes effected. Page numbers refer to Federal Register pages. 
The user should consult the entries for chapters and parts as well as 
sections for revisions.
For the period before January 1, 1986, see the ``List of CFR Sections 
Affected, 1949-1963, 1964-1972, and 1973-1985'' published in seven 
separate volumes.

                                  1986

31 CFR
                                                                   51 FR
                                                                    Page
Subtitle A
10.1  (b) revised...................................................2878
10.4  Nomenclature change...........................................2879
10.5  (a), (b) and (c) nomenclature change; (d) revised.............2878
10.6  Revised.......................................................2878
10.7  Nomenclature change...........................................2879
10.99  Revised......................................................2881
16  Added; interim.................................................28811
Chapter I
51.3  (e)(2) amended; interim......................................26884
51.25  (b) amended; interim........................................26884
51.26  (b)(2) revised; (b) introductory text republished; interim 
                                                                   19147
51.29  (c) added; interim..........................................19147
51.59  (b)(2) amended; interim.....................................26884
51.60  (c)(2) amended; interim.....................................26884
51.101  (b) amended; interim.......................................26884
51.210  (b)(2) and (10) revised....................................26885
51.211  (a) and (b) revised........................................26885
51.217  (a)(2) amended.............................................26886
51.218  Heading revised; nomenclature change.......................26886
51.219  Amended....................................................26886
51.221  Removed; new 51.221 redesignated from 51.223 and (c) 
        amended....................................................26886
51.222  Removed; new 51.222 redesignated from 51.224 and (b) 
        revised and (c) and (d) amended............................26886
51.223  Redesignated as 51.221 and (c) amended.....................26886
51.224  Redesignated as 51.222 and (b) revised and (c) and (d) 
        amended....................................................26886
103  Authority citation revised....................................45109
103.22  (d), (e), and (f) redesignated as (e), (f), and (g); new 
        (d) added; new (e) revised; new (g) amended................45109
128.11c  Added......................................................9790

                                  1987

31 CFR
                                                                   52 FR
                                                                    Page
Subtitle A
1  Authority citation revised......................................26305
1.1--1.7 (Subpart A)  Revised......................................26305
1.8--1.12 (Subpart B)  Revised.....................................26319
1.20  Revised......................................................26320
1.21--1.22  Revised................................................26321
1.23  Revised......................................................26322
1.24  Revised......................................................26323
1.25--1.26  Revised................................................26324
1.27  Revised......................................................26326
1.28  Revised......................................................26327
1.29--1.30  Revised................................................26328
1.31--1.32  Revised................................................26329
1.33  Removed......................................................26302
1.34--1.35  Revised................................................26329
1.36  Amended......................................................11990
1.20--1.36 (Subpart C)  Appendixes A through L revised.............26329
5.1--5.4 (Subpart A)  Heading added; authority citation revised.......44
5.5--5.22 (Subpart B)  Added..........................................44
    Revised........................................................39514

[[Page 414]]

5.23--5.29 (Subpart C)  Added.........................................50
5.30--5.38 (Subpart D)  Added.........................................52
16  Added..........................................................35071
18  Added (temporary)...............................................1452
Chapter I
51  Authority citation revised................................415, 36925
51.0  Revised; interim.............................................36925
51.1  Revised; interim.............................................36925
51.26  (a) heading revised; new (a)(3) added.........................415
103  Authority citation revised......................11441, 23978, 35545
    Nomenclature change............................................11442
103.11  Revised; eff. in part 7-7-87...............................11441
    (c) and (j)(4) corrected.......................................12641
103.22  Revised....................................................11442
103.24  Amended....................................................11443
    Correctly designated...........................................12641
103.26  Revised; eff. in part 7-7-87...............................11443
    (a)(1) and (b)(1) corrected....................................12641
103.27  Revised; eff. 7-7-87.......................................11443
    Corrected......................................................12641
103.32  Amended....................................................11444
103.33  Introductory text, (a) and (b) revised; OMB number; eff. 
        in part 7-7-87.............................................11444
103.34  (a) (1) and (2) amended; (b)(1) revised; (b)(13) added; 
        OMB number; eff. in part 7-7-87............................11444
103.35  (a) (1) and (2) amended; OMB number........................11444
103.36  (a) amended; OMB number....................................11444
103.37  Redesignated as 103.38; new 103.37 added; eff. 7-7-87......11444
103.38  Redesignated as 103.39; new 103.38 redesignated from 
        103.37.....................................................11444
    (c) redesignated as (d) and revised; new (c) added; OMB number
                                                                   11445
103.39  Redesignated from 103.38...................................11444
103.43  (a), (b), and (c) redesignated as (b), (d), and (e); new 
        (b) revised; new (a), (c), and (f) added...................35545
103.46  (b) removed; (a) redesignated as (b); new (b) introductory 
        text, (5) and (8) revised; (a), (c), (d), (e) and (f) 
        added......................................................11445
103.47  (a) and (b) redesignated as (b) and (d); new (b) revised; 
        (a), (c), (e), (f), (g) and (h) added......................11445
    (e) corrected..................................................12641
103.53  Added......................................................11446
103.61--103.67 (Subpart E)  Added..................................23979
103.70--103-77 (Subpart F)  Added..................................35546

                                  1988

31 CFR
                                                                   53 FR
                                                                    Page
Subtitle A
0  Revised.........................................................52090
5.30  Amended......................................................16703
25  Added; interim..................................................9728
    Revised........................................................25426
Chapter I
103  Exemption withdrawn...........................................32221
103  Appendix revised..............................................40064
103.11  (g)(9) and (r) added.........................................777
    (p) revised.....................................................4138
    Effective date corrected........................................5080
103.22  (a)(1) and (c) amended; (a)(3) redesignated as (a)(4); new 
        (a)(3) added.................................................777
    (d) and (e) amended.............................................4138
103.23  (b) amended.................................................4138
103.25  (a) amended; (e)(3) revised................................10073
103.26  (b)(3) amended..............................................4138
103.49  (c) (1) and (2) amended.....................................4138

                                  1989

31 CFR
                                                                   54 FR
                                                                    Page
Subtitle A
19  Redesignated from 26 CFR 601.901--601.942 (Subpart I) and 
        heading revised; authority citation added; interim..........4958
    Technical correction............................................6363
19.100--19.115 (Subpart A)  Heading added; interim..................4958
19.200--19.225 (Subpart B)  Heading added; interim..................4958
19.300--19.325 (Subpart C)  Heading added; interim..................4958
19.305  (c) (3) and (4) amended; (c)(5) added; interim..............4958
19.320  (a) revised; interim........................................4958
19.400--19.420 (Subpart D)  Heading added; interim..................4958

[[Page 415]]

19.500--19.510 (Subpart E)  Heading added; interim..................4958
19.600--19.630 (Subpart F)  Added; interim..........................4958
19  Appendixes A and B redesignated from 26 CFR 601.901--601.942 
        (Subpart I); interim........................................4958
    Appendix C added..........................................4951, 4958
Chapter I
103  Authority citation revised.....................................3027
103.11  (n) through (r) redesignated as (o) through (s); new (n) 
        added.......................................................3027
    (a) through (s) and (l)(1) (ii) through (iv) redesignated as 
(b) through (t) and (iii) through (v); new (l)(1) (iii) and (iv) 
amended; new (a) and (l)(1)(ii) added..............................28418
    Technical correction...........................................53036
103.23  (a) and (b) amended; (c)(8) redesignated as (9); new 
        (c)(8) added (OMB number)..................................28418
103.26  Redesignated as 103.27; new 103.26 added...................33679
103.27  Amended.....................................................3027
    Redesignated as 103.28; new 103.27 redesignated from 103.26....33679
103.28  Redesignated from 103.27...................................33678
103.33  (d) added..................................................33679
    Corrected......................................................34976
103.36  (b)(8) and (c) added........................................1167
103.38  (d) amended................................................33679
    Corrected......................................................34976
103.53  (c) amended.................................................3027
103  Appendix added................................................21214
    Appendix amended...............................................30543
129  Reporting requirements and forms availability.................50373
129.1  Revised.....................................................38228
129.2  (g) revised.................................................38228
129.3  Revised.....................................................38228

                                  1990

31 CFR
                                                                   55 FR
                                                                    Page
Subtitle A
2  Revised..........................................................1644
    Authority citation revised.....................................50321
2.2  (a) corrected.................................................13134
2.14  (a) designation correctly removed............................13134
2.26  (d) introductory text corrected..............................13134
2.28  (d)(1) revised...............................................50321
2.36  Introductory text corrected...................................5118
19.600--19.635 (Subpart F)  Regulation at 54 FR 4950, 4958 
        confirmed; revised; eff. in part 7-24-90............21688, 21697
19  Appendix C regulation at 54 FR 4950, 4958 confirmed; revised; 
        eff. 7-24-90........................................21690, 21697
21  Added.....................................................6737, 6751
103.11  (g) through (t) redesignated as (h) through (u); new (g) 
        added; eff 8-13-90.........................................20143
103.29  Added; eff 8-13-90.........................................20143
103  Appendix amended...............................................1022

                                  1991

31 CFR
                                                                   56 FR
                                                                    Page
Subtitle A
1.36  Amended......................................................12447
3  Heading and authority citation revised..........................42938
3.30 (Subpart C)  Added............................................42938
17  Added..........................................................40788
Chapter I
100.5  (a) introductory text amended...............................10170
100.7  (d) amended.................................................10170
100.9  Amended.....................................................10170
100.17  Amended....................................................10170

                                  1992

31 CFR
                                                                   57 FR
                                                                    Page
Subtitle A
10.0  Amended......................................................41095
10.20  (a) and (b) amended.........................................41095
10.21  Amended.....................................................41095
10.22  Introductory text amended...................................41095
10.23  Amended.....................................................41095
10.24  Introductory text amended...................................41095
10.26  (a)(4) amended..............................................41095
10.27  Amended.....................................................41095
10.28  Amended.....................................................41095
10.29  Amended.....................................................41095

[[Page 416]]

10.30  (b) removed; (c)(1) introductory text, (2), (3) and (e) 
        amended; (c), (d) and (e) redesignated as (b), (c) and 
        (d); (a) and new (c) revised; new (b)(1)(iv) amended.......41095
10.31  Amended.....................................................41095
10.50  Amended.....................................................41095
10.51  Introductory text amended...................................41095
10.52  (a) amended.................................................41095
10.53  Amended.....................................................41095
10.54  Amended.....................................................41095
10.55  (a) and (b) amended.........................................41095
12  Removed........................................................19377
26  Added..........................................................24545
Chapter I
123  Removed.......................................................21740

                                  1993

31 CFR
                                                                   58 FR
                                                                    Page
Subtitle A
11  Revised........................................................57560
Chapter I
103  Authority citation revised....................................13546
103.11  (i)(7) revised; eff. 9-8-93................................13546
    Regulation at 58 FR 13546 eff. date delayed to 3-1-94..........45263
103.22  (a)(2) revised; eff. 9-8-93................................13547
    Regulation at 58 FR 13547 eff. date delayed to 3-1-94..........45263
103.28  Existing text designated in part as (a)(1) and (a)(3); 
        remaining text removed; (a)(2) and (b) added; new (a)(1) 
        amended; eff. 9-8-93.......................................13547
    Regulation at 58 FR 13547 eff. date delayed to 3-1-94..........45263
103.36  (a) and (b)(4) amended; (b)(9) through (15) added; eff. 9-
        8-93.......................................................13548
    Regulation at 58 FR 13548 eff. date delayed to 3-1-94..........45263
103.54  Added; eff. 9-8-93.........................................13549
    Regulation at 58 FR 13549 eff. date delayed to 3-1-94..........45263
103  Appendix amended...............................................7048
128  Revised.......................................................58495
129  Revised.......................................................30707
    Reporting requirements.........................................68528

                                  1994

31 CFR
                                                                   59 FR
                                                                    Page
Subtitle A
1.36  (a)(1) table amended.........................................47538
10.0  Revised......................................................31526
10.2  Revised......................................................31526
10.3  (a), (b), (e), and (f) revised...............................31526
10.4  (d) removed..................................................31526
10.7  Heading and text revised; authority citation removed.........31526
10.26  (a)(4) revised..............................................31527
10.28  Revised.....................................................31527
10.33  (c)(1) revised..............................................31527
    (d)  redesignated from 10.76; amended; authority citation 
removed............................................................31528
10.34  Added.......................................................31527
10.50  Revised.....................................................31528
10.51  (j) amended.................................................31528
10.52  Revised.....................................................31528
10.65  (a) revised.................................................31528
10.76  Redesignated as 10.33 (d); new 10.76 added..................31528
10.99  Removed.....................................................31529
Chapter I
51  Removed........................................................35624
52  Removed........................................................35624
103  Authority citation revised....................................52252
103.11  Regulation  at 58 FR 13546 eff. date delayed to 12-1-94.....9088
103.22  Regulation  at 58 FR 13547 eff. date delayed to 12-1-94.....9088
103.22  (a)(2)(iii) revised; (a)(2)(iv) removed....................61662
103.28  Regulation  at 58 FR 13547 eff. date delayed to 12-1-94.....9088
103.28  Regulation at 58 FR 13547 withdrawn........................61662
103.29  Revised....................................................52252
103.36  Regulation  at 57 FR 13548 eff. date delayed to 12-1-94.....9088
103.36  Regulation at 58 FR 13548 withdrawn in part; (a) amended; 
        (b)(11) and (12) redesignated as (b)(9) and (10)...........61662
103.54  Regulation  at 57 FR 13549 eff. date delayed to 12-1-94.....9088
103.54  (a)(2)(iii) and (v)(B) revised; (b) and (d) removed; (c) 
        redesignated as (b)........................................61662

                                  1995

31 CFR
                                                                   60 FR
                                                                    Page
Subtitle A
0  Revised; interim................................................28535

[[Page 417]]

0  Regulation at 60 FR 28535 confirmed.............................42042
1.1  (d)(13) added.................................................31632
1.1--1.7 (Subpart A)  Appendix J amended...........................57333
1.1--1.8 (Subpart A)  appendix M revised...........................31632
1.20  (m) added....................................................31633
1.20--1.36 (Subpart C)  appendix M added...........................31633
  Appendix J amended...............................................57333
19.100  Revised; eff. 8-25-95...............................33040, 33052
19.105  Amended; eff. 8-25-95...............................33041, 33052
19.110  (c) revised; eff. 8-25-95...........................33041, 33052
19.200  Revised; eff. 8-25-95...............................33041, 33052
19.215  Revised; eff. 8-25-95...............................33041, 33052
19.220  Revised; eff. 8-25-95...............................33041, 33052
19.225  Revised; eff. 8-25-95...............................33041, 33052
19  Appendixes A and B revised; eff. 8-25-95................33042, 33052
Chapter I
103  Authority citation revised......................................228
103.11  (a) through (u) redesignated as (b), (c), (f) through (k), 
        (n), (o), (p), (t), (u), (z), (ee), (gg), (hh), (ii), 
        (nn), (oo) and (pp); new (j) amended; new (a), new (d), 
        new (e), new (l), new (m), new (q), new (r), new (s), (v) 
        through (y), (aa) through (dd), (ff) and (jj) through (mm) 
        added; eff. 1-1-96...........................................228
103.11  Regulation at 60 FR 228 eff. date delayed to 4-1-96........44144
103.25  (b)(2) revised; eff. 1-1-96..................................229
103.25  Regulation at 60 FR 229 eff. date delayed to 4-1-96........44144
    Regulation at 60 FR 229 eff. date delayed to 4-1-96............44144
    Regulation at 60 FR 238 eff. date delayed to 4-1-96............44145
103.33  (e) and (f) added; eff. 1-1-96...............................229
    (g) added; eff. 1-1-96...........................................238
103.54  (a)(1) revised; (a)(2)(v)(B) amended.......................33725

                                  1996

31 CFR
                                                                   61 FR
                                                                    Page
Subtitle A
1  Determination...................................................60559
1.36  Amended........................................................387
12  Added..........................................................25396
Chapter I
103  Authority citation revised..............................4331, 14383
103.11  (r) revised; (qq) added.....................................4331
    (n)(7)(i), (z) and (nn) revised; (rr), (ss) and (tt) added; 
eff. 8-1-96.........................................................7055
    (r) correctly designated.......................................14249
    Regulation at 60 FR 228 eff. date delayed to 5-28-96...........14382
    (e), (w), (y) introductory text, (aa), (bb), (dd), (kk) 
introductory text, (ll) and (mm) revised...........................14385
103.20  Redesignated from 103.21....................................4331
103.21  Redesignated as 103.20; new 103.21 added....................4331
    (e) corrected..................................................14249
    (f) corrected..................................................18250
103.22  (a)(1) amended; (h) added; interim.........................18209
103.25  Regulation at 60 FR 229 eff. date delayed to 5-28-96.......14382
103.33  (e) introductory text, (1)(i) introductory text, (ii), 
        (iii), (6)(i)(A) through (G), (ii), (f) introductory text, 
        (1)(i) introductory text, (ii), (iii), (6)(i)(A) through 
        (G) and (ii) revised.......................................14385
    Regulation at 60 FR 229 eff. date delayed to 5-28-96...........14382
    Regulation at 60 FR 238 eff. date delayed to 5-28-96...........14383
    (g) introductory text, (1) introductory text revised; (g)(3) 
and (4) added......................................................14388
    (g)(3) introductory text corrected.............................18250
103.36  (b)(7) amended; eff. 8-1-96.................................7056

                                  1997

31 CFR
                                                                   62 FR
                                                                    Page
Subtitle A
1.36  (a)(1) table and (b)(1) table amended........................19505
    Amended........................................................26939
    Heading revised; (g) redesignated as (l); new (g) through (k) 
added..............................................................58908
    (b)(1) table amended...........................................60782
4  Revised.........................................................18518

[[Page 418]]

Chapter I
27  Added; interim.................................................42213
27.7  (c)(3)(ii)(F) corrected......................................44036
103  Meeting.......................................................58909
103.22  Regulation at 61 FR 18209 confirmed; (a)(1) amended; (h) 
        revised....................................................47147

                                  1998

31 CFR
                                                                   63 FR
                                                                    Page
Chapter I
103  Technical correction..........................................37777
103.22  Revised....................................................50156
Chapter II
208  Revised.......................................................51502
285  Regulation at 62 FR 34179 confirmed...........................46140
    Authority citation revised..............................67756, 72094
285.1  Regulation at 62 FR 36210 confirmed; (a) amended; (g), (m), 
        (n) and (o) revised; (j)(5) added..........................46145
285.3  Added.......................................................72094
285.4  Added; interim..............................................44988
    Regulation at 63 FR 44988 confirmed............................71204
285.13  Added......................................................67756
317  Authority citation revised.............................38041, 64550
317.0  Revised.....................................................38041
317.1  (d) revised.................................................38041
    Revised........................................................64550
317.2  Revised.....................................................64550
317.3  (a) introductory text revised; (b) and (c) amended..........64550
317.6  (b) revised.................................................64550
317.8  Appendix amended............................................38041
    Appendix amended...............................................64550
317.9  (b)(2) removed; (b)(1) redesignated as (b); new (b) table 
        amended....................................................38041
321  Authority citation revised....................................38042
321.0  (a) and (b) revised.........................................38042
321.1  (o) revised.................................................38042
321.3  (c) revised.................................................38042
321.6  Revised.....................................................38042
321.7  (a) and (g) revised.........................................38042
321.9  (a) revised.................................................38042
321.12  Revised....................................................38042
321.25  (b)(2) removed; (b)(1) redesignated as (b); new (b) table 
        amended....................................................38042
321  Appendix amended.......................................38042, 38043
330  Authority citation revised....................................38044
330.1  (f) revised.................................................38044
330.5  (a) revised.................................................38044
330.6  (a) revised.................................................38044
330.7  Revised.....................................................38044
330.8  Revised.....................................................38044
330.9  (b)(2) removed; (b)(1) redesignated as (b); new (b) table 
        amended....................................................38044
330.10  Revised....................................................38044
351.1  Revised.....................................................64551
351.5  Revised.....................................................64551
353  Authority citation revised....................................64551
353.6  (b)(4) amended..............................................64551
353.13  (c)(3) amended.............................................64551
353.21  (a) revised................................................64551
353.27  Revised....................................................64551
357  Determination..........................................35807, 50159
357  Appendix B amended............................................69191
359  Added.........................................................38044
359.2  (e)(1)(i) through (v) revised...............................45946
359.3  (b)(1) revised..............................................45947
360  Added.........................................................38049
370  Authority citation revised....................................64552
    Heading revised................................................64552
370.0--370.1 (Subpart A)  Revised..................................64552
370.20--370.25 (Subpart C)  Heading revised........................64553
370.30--370.31 (Subpart D)  Redesignated as 370.60--370.61 
        (Subpart F)................................................64553
370.30--370.38 (Subpart D)  Added..................................64553
370.50--370.57 (Subpart E)  Added..................................64554
Chapter V
501.803  Correctly revised.........................................35809
515.560  Corrected.................................................35808
538  Added.........................................................35810
560  Authority citation revised....................................62941
560.525  Corrected.................................................35808
560.603  Revised...................................................62941
575  Authority citation revised....................................62942
575.522  Heading revised; (a)(2) and (3) amended; (a)(4) added.....62942
585  Authority citation revised....................................59884
585.528  Heading revised; (d) added................................59884
586  Added.........................................................54576
Chapter VII
700  Revised.......................................................39730

[[Page 419]]

                                  1999

31 CFR
                                                                   64 FR
                                                                    Page
Subtitle A
1.36  Amended......................................................62586
18  Revised........................................................62112
Chapter I
100  Authority citation revised....................................39920
100.11  (b) revised................................................39920
100.12  (b) revised................................................39920
103  Exception.....................................................41041
103.11  (c)(7) and (n)(3) revised; (i), (n)(4), (5) and (10) 
        removed; (n)(6) through (9) redesignated as (n)(4) through 
        (7); new (n)(5), new (6) and new (7) amended; (uu) and 
        (vv) added.................................................45450
103.36  (b)(10) amended............................................45453
103.37  (c) added..................................................45453
103.41--103.54 (Subpart D)  Redesignated as 103.51--103.64 
        (Subpart E); new 103.41 (Subpart D) added..................45451
103.56  (b)(7) amended.............................................45453
103.57  (d) and (e) amended........................................45453
103.61--103.67 (Subpart E)  Redesignated as 103.71--103.77 
        (Subpart F)................................................45451
103.72  Introductory text amended..................................45453
103.73  (a) introductory text, (1), (b) introductory text and (1) 
        amended....................................................45453
103.74  (a) amended................................................45453
103.75  (a) and (c) introductory text amended......................45453
103.76  Amended....................................................45453
103.70--103.77 (Subpart F)  Redesignated as 103.80--103.87 
        (Subpart G)................................................45451
103.82  Amended....................................................45453
103.83  (b) amended................................................45453
103.85  Amended....................................................45453
103.86  (a) introductory text and (b) amended......................45453

                                  2000

   (Regulations published from January 1, 2000, through July 1, 2000)

31 CFR
                                                                   65 FR
                                                                    Page
Subtitle A
1.1--1.7 (Subpart A)  Revised......................................40504
1.20  (a) through (l) revised.......................................2333
1.20--1.36 (Subpart C)  Appendix K removed; Appendixes L and M 
        redesignated as Appendixes K and L..........................2334
Chapter I
103.11  (ii)(1) revised............................................13692
103.15  Redesignated from 103.20...................................13692
103.18  Redesignated from 103.21...................................13692
103.20  Redesignated as 103.15; new 103.20 added...................13692
103.21  Redesignated as 103.18.....................................13692