[Federal Register Volume 61, Number 207 (Thursday, October 24, 1996)]
[Rules and Regulations]
[Page 55079]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-27248]



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 Rules and Regulations
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  Federal Register / Vol. 61, No. 207 / Thursday, October 24, 1996 / 
Rules and Regulations  

[[Page 55079]]



FARM CREDIT SYSTEM INSURANCE CORPORATION

12 CFR Part 1411

RIN 3055-AA05


Rules of Practice and Procedure; Adjusting Civil Money Penalties 
for Inflation

AGENCY: Farm Credit System Insurance Corporation.

ACTION: Final rule.

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SUMMARY: The Farm Credit System Insurance Corporation (Corporation) 
through its Board (Board) adopts a final regulation that adjusts each 
civil money penalty (CMP) under its jurisdiction by the rate of 
inflation using the formula prescribed in the Debt Collection 
Improvement Act of 1996 (DCIA). This statute requires all Federal 
agencies to adjust each CMP by the rate of inflation and publish the 
adjustment within 180 days after enactment of DCIA and at least once 
every 4 years thereafter. Any increase in a CMP shall apply only to 
violations that occur after the effective date of this regulation.

EFFECTIVE DATE: October 23, 1996.

FOR FURTHER INFORMATION CONTACT: Dorothy L. Nichols, General Counsel, 
Farm Credit System Insurance Corporation, McLean, VA 22102-5090, (703) 
883-4211, TDD (703) 883-4444.

SUPPLEMENTARY INFORMATION: DCIA 1 amended the Federal Civil 
Monetary Penalties Inflation Adjustment Act of 1990 2 (FCMPIA Act) 
by requiring every Federal agency to adjust each CMP 3 by the rate 
of inflation pursuant to the inflation adjustment formula in section 
5(b) of the FCMPIA Act. Each Federal agency is required to publish the 
adjusted penalty to implement the DCIA by October 23, 1996, which is 
180 days after the date that DCIA was enacted, and at least once every 
4 years thereafter. Section 7 of the amended FCMPIA Act specifies that 
only CMPs for violations that occur after October 23, 1996 will be 
adjusted for inflation.
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    \1\ Pub. L. 104-134, 31001(s), 110 Stat. 1321-358, (Apr. 26, 
1996). This provision is codified at 28 U.S.C. 2461 note.
    \2\ Pub. L. 101-410, 104 Stat. 890, (Oct. 5, 1990).
    \3\ Section 3(2) of the amended FCMPIA Act defines a CMP as any 
penalty, fine, or other sanction that: (1) Either is for a specific 
monetary amount as provided by Federal law or has a maximum amount 
provided for by Federal law; (2) is assessed or enforced by an 
agency pursuant to Federal law; and (3) is assessed or enforced 
pursuant to an administrative proceeding or a civil action in the 
Federal courts.
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    The inflation adjustment is based on the percentage increase in the 
Consumer Price Index 4 (CPI) for the period from June of the 
calendar year when the CMP was last set until June of the calendar year 
preceding the adjustment. Furthermore, each CMP that has been adjusted 
for inflation must be rounded to a number prescribed by section 5(a) of 
the FCMPIA Act. Another provision of the DCIA specifies that the first 
adjustment of a CMP may not exceed 10 percent of the original penalty.
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    \4\ The CPI is published by the Department of Labor, Bureau of 
Statistics.
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    Two provisions of section 5.65 of the Farm Credit Act of 1971, as 
amended (Act) authorize the Corporation to impose CMPs on Farm Credit 
System (System) insured banks. First, section 5.65(c) specifies that 
any insured System bank that willfully fails or refuses to file any 
certified statement or pay any premium required under part E of the Act 
shall be subject to a penalty of $100 for each day that the violation 
continues. 12 U.S.C. 2277a-14(c). Second, section 5.65(d) makes it 
unlawful for anyone convicted of a criminal offense involving 
dishonesty or a breach of trust to serve as a director, officer, or 
employee of any System institution, without the prior written consent 
of the Farm Credit Administration. 12 U.S.C. 2277a-14(d). For a willful 
violation of this section, the Corporation may subject the institution 
to a penalty of $100 for each day that the violation continues.
    The maximum penalty that the Corporation can impose under section 
5.65 (c) and (d) of the Act for a violation of these provisions is $110 
per day, when it is adjusted for inflation, pursuant to the 
requirements of the DCIA. The Corporation now adopts in final a new 
Sec. 1411.1. This regulation adjusts these two CMPs to the rate of 
inflation, as required by the DCIA.
    DCIA provides Federal agencies with no discretion about how to 
adjust CMPs to the rate of inflation, and it also requires the 
inflation adjusted penalty to take effect on October 23, 1996. This 
regulation, implementing DCIA as required, is minor, technical, and 
noncontroversial. For these reasons, the Corporation finds good cause 
to determine that public notice and comment for this new regulation is 
unnecessary, impractical, and contrary to the public interest, pursuant 
to the Administrative Procedure Act (APA), 5 U.S.C. 553(a)(3)(B). The 
same rationale provides the Corporation with good cause to adopt an 
effective date for this regulation that is less than 30 days after the 
date of publication in the Federal Register and prior to filing any 
reports called for in the Small Business Regulatory Enforcement 
Fairness Act, 5 U.S.C. 801-808.

List of Subjects in 12 CFR Part 1411

    Banks, banking, Civil money penalties, Penalties.

    For the reasons stated in the preamble, part 1411 of chapter XIV, 
title 12 of the Code of Federal Regulations is added to read as 
follows:

PART 1411--RULES OF PRACTICE AND PROCEDURE

    Authority: Secs. 5.58(10), 5.65(c) and (d) of the Farm Credit 
Act (12 U.S.C. 2277a-7(10), 2277a-14(c) and (d)).

Subpart A--Rules and Procedures for Assessment and Collection of 
Civil Money Penalties


Sec. 1411.1  Inflation adjustment of civil money penalties for failure 
to file a certified statement, pay any premium required or obtain 
approval before employment of persons convicted of criminal offenses.

    A civil money penalty imposed pursuant to section 5.65(c) or (d) of 
the Act for a violation occurring on or after October 23, 1996 shall 
not exceed $110 per day for each day the violation continues.

    Dated: October 18, 1996.
Floyd Fithian,
Secretary, Farm Credit System Insurance Corporation Board.
[FR Doc. 96-27248 Filed 10-23-96; 8:45 am]
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