[Federal Register Volume 67, Number 161 (Tuesday, August 20, 2002)]
[Notices]
[Pages 53936-53942]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-21117]


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FEDERAL TRADE COMMISSION


Agency Information Collection Activities; Proposed Collection; 
Comment Request; Extension

AGENCY: Federal Trade Commission (FTC).

ACTION: Notice.

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SUMMARY: The Federal Trade Commission is seeking public

[[Page 53937]]

comments on its proposal to extend through December 31, 2005 the 
current Paperwork Reduction Act (``PRA'') clearance for information 
collection requirements contained in four consumer credit regulations 
enforced by the Commission. That clearance expires on December 31, 
2002.

DATES: Comments must be filed by October 21, 2002.

ADDRESSES: Send written comments to Secretary, Federal Trade 
Commission, Room H-159, 600 Pennsylvania Ave., NW., Washington, DC 
20580. All comments should be captioned ``Regs BEMZ: Paperwork 
Comment.'' Comments in electronic form should be sent to: 
[email protected], as prescribed below.

FOR FURTHER INFORMATION CONTACT: Requests for additional information or 
copies of the proposed information requirements should be addressed to 
Carole Reynolds, Attorney, Division of Financial Practices, Bureau of 
Consumer Protection, Federal Trade Commission, 600 Pennsylvania Ave., 
NW., Washington, DC 20580, (202) 326-3230.

SUPPLEMENTARY INFORMATION: Under the PRA (44 U.S.C. 3501-3520), Federal 
agencies must obtain approval from the Office of Management and Budget 
(OMB) for each collection of information they conduct or sponsor. 
``Collection of information'' means agency requests or requirements 
that members of the public submit reports, keep records, or provide 
information to a third party. 44 U.S.C. 3502(3), 5 CFR 1320.3(c). As 
required by section 3506(c)(2)(A) of the PRA, the FTC is providing this 
opportunity for public comment before requesting that OMB extend the 
existing paperwork clearance for the regulations noted herein.
    The FTC invites comments on: (1) Whether the proposed collection of 
information is necessary for the proper performance of the functions of 
the agency, including whether the information will have practical 
utility; (2) the accuracy of the agency's estimate of the burden of the 
proposed collection of information, including the validity of the 
methodology and assumptions used; (3) ways to enhance the quality, 
utility, and clarity of the information to be collected; and (4) ways 
to minimize the burden of the collection of information on those who 
are to respond, including through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology, e.g., permitting electronic 
submission of responses.
    If a comment contains nonpublic information, it must be filed in 
paper form, and the first page of the document must be clearly labeled 
``confidential.'' Comments that do not contain any nonpublic 
information may instead be filed in electronic form (in ASCII format, 
WordPerfect, or Microsoft Word) as part of or as an attachment to e-
mail messages directed to the following e-mail box: 
[email protected]. Such comments will be considered by the 
Commission and will be available for inspection and copying at its 
principal office in accordance with Section 4.9(b)(6)(ii) of the 
Commission's rules of practice, 16 CFR section 4.9(b)(6)(ii)).
    The four rules covered by this notice are:
    (1) Regulations promulgated under The Equal Credit Opportunity Act, 
15 U.S.C. 1691 et seq. (``ECOA'') (``Regulation B'') (Control Number: 
3084-0087);
    (2) Regulations promulgated under The Electronic Fund Transfer Act, 
15 U.S.C. 1693 et seq. (``EFTA'') (``Regulation E'') (Control Number: 
3084-0085);
    (3) Regulations promulgated under The Consumer Leasing Act, 15 
U.S.C. 1697 et seq. (``CLA'') (``Regulation M'') (Control Number: 3084-
0086);
    (4) Regulations promulgated under The Truth-In-Lending Act, 15 
U.S.C. 1601 et seq. (``TILA'') (``Regulation Z'') (Control Number: 
3084-0088);
    Each of these four rules impose certain PRA recordkeeping and 
disclosure requirements associated with providing credit or with other 
financial transactions. All of these rules require covered entities to 
keep certain records. Staff believes that these entities would likely 
retain these records in the normal course of business even absent the 
recordkeeping requirement in the rules.\1\ There is, however, some 
burden associated with ensuring that covered entities do not 
prematurely dispose of relevant records during the period of time 
required by the applicable rule.
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    \1\ PRA ``burden'' does not include effort expended in the 
ordinary course of business, regardless of any regulatory 
requirement. 5 CFR 1320.3(b)(2).
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    Disclosure requirements involve both set-up and monitoring costs as 
well as certain transaction-specific costs. ``Set-up'' burden, incurred 
by new entrants only, includes identifying the applicable disclosure 
requirements, determining compliance obligations, and designing and 
developing compliance systems and procedures. ``Monitoring'' burden, 
incurred by all covered entities, includes reviewing revisions to 
regulatory requirements, revising compliance systems and procedures as 
necessary, and monitoring the ongoing operation of systems and 
procedures to ensure continued compliance. ``Transaction-related'' 
burden refers to the effort associated with providing the various 
required disclosures in individual transactions. While this burden 
varies with the number of transactions, the figures shown for 
transaction-related burden in the tables that follow are estimated 
averages.
    The actual range of compliance burden experienced by covered 
entities, and reflected in those averages, varies widely. Depending on 
the extent to which covered entities have developed automated systems 
and procedures for providing the required disclosures, and the efficacy 
of those systems and procedures, some entities may have little or no 
such burden, while others incur a higher burden.\2\
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    \2\ For example, large retailers may use automated means to 
provide required disclosures, such as issuing, en masse, notices of 
changes of terms. Smaller retailers and certain types of creditors 
may have less automated compliance systems, and thus may issue 
disclosures on an individual transaction basis, resulting in higher 
burden.
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    Calculating the burden associated with the four regulations' 
disclosure requirements is very difficult because of the highly diverse 
group of affected entities. The ``respondents'' included in the 
following burden calculations consist of credit and lease advertisers, 
creditors, financial institutions, service providers, certain 
government agencies and others involved in delivering electronic fund 
transfers of government benefits, and lessors. The burden estimates 
represent staff's best assessment, based on its knowledge and expertise 
relating to the financial services industry. To derive these estimates, 
staff considered the wide variations in covered entities: (1) Size and 
location; (2) credit or lease products offered, extended, or 
advertised, and their particular terms; (3) types of electronic fund 
transfers (EFTs) used; (4) types and occurrences of adverse actions; 
(5) types of appraisal reports utilized; and (6) automation with regard 
to compliance operations.
    In some instances, where covered entities may make certain required 
disclosures in the ordinary course of business, the Regulation imposes 
no PRA burden. In addition, some entities have developed highly 
automated means of providing the required disclosures, while others 
rely on methods requiring more manual effort.
    The estimated PRA burden associated with these rules, attributable 
to the Commission, is less today than in the past. Staff believes that 
as automation and expanded quality control become more pervasive in the 
financial services

[[Page 53938]]

industry, entities are able to comply more efficiently.
    The cost estimates shown below relate solely to labor costs. The 
applicable PRA requirements impose minimal capital or other non-labor 
costs, as affected entities generally have the necessary equipment for 
other business purposes. Similarly, staff estimates that compliance 
with these rules entails minimal printing and copying costs beyond that 
associated with documenting financial transactions in the ordinary 
course of business. The burden estimates shown below include the time 
necessary to train staff to be in compliance with the regulations.
    The following paragraphs discuss each of these rules, their 
particular FRA requirements, and staff's best estimates of the related 
hour and cost burdens.

1. Regulation B

    The ECOA prohibits discrimination in the extension of credit. 
Regulation B, 12 CFR 202, promulgated by the Board of Governors of the 
Federal Reserve System, establishes both recordkeeping and disclosure 
requirements to assist consumers in understanding their rights under 
the ECOA and to assist in detecting unlawful discrimination. The FTC 
enforces the ECOA as to all creditors except those that are subject to 
the regulatory authority of another federal agency (such as federally 
chartered or insured depository institutions).
    Estimated annual hours burden: 2,500,000 hours, rounded to the 
nearest thousand (1,150,000 recordkeeping hours - 1,409,499 
disclosure hours).
    Recordkeeping: FTC staff estimates that Regulation B's general 
recordkeeping requirements affect 1,000,000 credit firms subject to the 
Commission's jurisdiction, at an average annual burden of one hour per 
firm, for a total of 1,000,000 hours. Staff also estimates that the 
requirement that creditors monitor information about race/national 
original, sex, age, and marital status imposes a maximum burden of one 
minute each \3\ for approximately nine million credit applications 
(based on industry data regarding the approximate number of mortgage 
purchase and refinance originations), for a total of 150,000 hours. The 
total estimated recordkeeping burden is 1,150,000 hours.
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    \3\ Regulation B contains a model form the creditors may use to 
gather and retain the required information.
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    Disclosure: Regulation B requires that creditors (i.e., entities 
that regularly participate in the decision whether to extend credit 
under Regulation B) provide notices whenever they take adverse action. 
The Regulation also requires entities that extend various types of 
mortgage credit to provide a copy of the appraisal report to applicants 
and to notify them of their right to a copy of the report.
    Regulation B applies to retailers, mortgage lenders, mortgage 
brokers, finance companies, Internet businesses, and others. Below is 
staff's best estimate of burden applicable to this highly broad 
spectrum of covered entities.

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                                                                  Setup/monitoring \1\                     Transaction-related \2\
                                                       ------------------------------------------------------------------------------------
                                                                         Average    Total setup/                   Average        Total     Total burden
                      Disclosure                                       burden per    monitoring     Number of    burden per    transaction     (hours)
                                                         Respondents   respondent      burden     transactions   transaction     burden
                                                                         (hours)       (hours)                    (minutes)      (hours)
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Adverse action notices................................     1,000,000            .5       500,000   200,000,000           .25       833,333     1,333,333
Appraisal notices.....................................        22,000            .5        11,000     6,500,000           .25        27,083        38,083
Appraisal reports.....................................        22,000            .5        11,000     6,500,000           .25        27,083        38,083
                                                       -------------------------------------------------------------------------------------------------
      Total...........................................  ............  ............  ............  ............  ............  ............    1,409,499
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\1\ With respect to appraisal notices and appraisal reports, the above figures assume that approximately half of applicable mortgage entities (.5 x
  44,000, or 22,000 businesses) would not otherwise provide this information and thus would be affected.
\2\ The above figures assume that half of applicable mortgage transactions (.5 x 13,000,000, or 6,500,000) would not otherwise provide the appraisal
  notices and reports and thus would be affected.

    Estimated annual cost burden: $46,418,000, rounded to the nearest 
thousand.
    Staff calculated labor costs by applying appropriate hourly cost 
figures to the burden hours described above. The hourly rates used 
below ($50 for managerial or professional time, $20 for skilled 
technical time, and $10 for clerical time) are averages.
    Recordkeeping: Staff estimates that the general recordkeeping 
responsibility of one hour per creditor would involve approximately 90 
percent clerical time and 10 percent skilled technical time. Keeping 
records of race/national origin, sex, age, and maritial status requires 
an estimated one minute of skilled technical time. As shown below, the 
total recordkeeping cost is $14,000,000.
    Disclosure: For each notice or information item listed, staff 
estimates that the burden hours consist of 10 percent managerial time 
and 90 percent skilled technical time. As shown below, the total 
disclosure cost is $32,418,500.

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                                                                Managerial               Skilled technical               Clerical
                                                       ------------------------------------------------------------------------------------  Total cost
                     Required task                                     Cost ($50/                  Cost ($20/                  Cost ($10/        ($)
                                                        Time (hours)      hr.)      Time (hours)      hr.)      Time (hours)      hr.)
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General Recordkeeping.................................             0             0       100,000    $2,000,000       900,000    $9,000,000   $11,000,000
Other Recordkeeping...................................             0             0       150,000     3,000,000             0             0     3,000,000
                                                       -------------------------------------------------------------------------------------------------
      Total Recordkeeping.............................  ............  ............  ............  ............  ............  ............    14,000,000
                                                       =================================================================================================
Adverse action notices................................       133,333    $6,666,650     1,200,000    24,000,000             0             0    30,666,650
Appraisal notices.....................................         3,808       190,400        34,275       685,500             0             0       875,900
Appraisal reports.....................................         3,808       190,400        34,275       685,500             0             0       875,900
                                                       -------------------------------------------------------------------------------------------------

[[Page 53939]]

 
      Total Disclosure................................  ............  ............  ............  ............  ............  ............    32,418,500
                                                       =================================================================================================
      Total Recordkeeping and Disclosure..............  ............  ............  ............  ............  ............  ............    46,418,450
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2. Regulation E

    The EFTA requires accurate disclosure of the costs, terms, and 
rights relating to electronic fund transfer (EFT) services to 
consumers. Regulation E, 12 CFR 205, promulgated by the Board of 
Governors of the Federal Reserve System, establishes both recordkeeping 
and disclosure requirements applicable to entities providing EFT 
services to consumers. The FTC enforces the EFTA as to all entities 
providing EFT services except those that are subject to the regulatory 
authority of another federal agency (such as federally chartered or 
insured depository institutions).
    Estimated annual hours burden: 3,580,000 hours (500,000 
recordkeeping hours + approximately 3,080,000 disclosure hours).
    Recordkeeping: Staff estimates that Regulation E's recordkeeping 
requirements affect 500,000 firms offering EFT services to consumers 
and subject to the Commission's jurisdiction, at an average burden of 
one hour per firm, for a total of 500,000 hours.
    Disclosure: Regulation E applies to financial institutions 
(including certain retailers and electronic commerce entities), service 
providers, various federal and state agencies offering electronic fund 
transfers (EFTs), and others. Below is staff's best estimate of burden 
applicable to this highly broad spectrum of covered entities.

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                                                                Setup/monitoring                           Transaction-related
                                                   ----------------------------------------------------------------------------------------
                                                                     Average    Total setup/                       Average        Total     Total burden
                    Disclosure                                     burden per    monitoring       Number of      burden per    transaction     (hours)
                                                     Respondents   respondent      burden       transactions     transaction     burden
                                                                     (hours)       (hours)                        (minutes)      (hours)
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Initial terms.....................................       100,000            .5        50,000         1,000,000           .02           333        50,333
Change in terms...................................        25,000            .5        12,500        33,000,000           .02        11,000        23,500
Periodic statements...............................       100,000            .5        50,000      1,200,000,00           .02       400,000       450,000
Error resolution..................................       100,000            .5        50,000         1,000,000             5        83,333       133,333
Transaction receipts..............................       100,000            .5        50,000     5,000,000,000           .02     1,666,667     1,716,667
Preauthorized transfers...........................       500,000            .5       250,000         1,000,000           .25         4,167       254,167
Service provider notices..........................       100,000           .25        25,000         1,000,000           .25         4,167        29,167
Govt. benefit notices.............................        10,000            .5         5,000       100,000,000           .25       416,667       421,667
ATM notices \1\...................................           500           .25           125           250,000           .25         1,041         1,166
                                                   -----------------------------------------------------------------------------------------------------
      Total.......................................  ............  ............  ............  ................  ............  ............    3,080,000
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\1\ Starting in 2001, ATM operators were required to provide certain notices to consumers regarding ATM fees. Generally, these notices must be provided
  on or at ATM machines and/or on paper before the consumer is committed to paying a fee.

    Estimate annual cost burden: $76,240,000, rounded to the nearest 
thousand.
    Staff calculated labor costs by applying appropriate hourly cost 
figures to the burden hours described above. The hourly rates used 
below ($50 for managerial or professional time, $20 for skilled 
technical time, and $10 for clerical time) are averages.
    Recordkeeping: For the 500,000 recordkeeping hours, staff estimates 
that 10 percent of the burden hours require skilled technical time and 
90 percent require clerical time. As shown below, the total 
recordkeeping cost is $5,500,000.
    Disclosure: For each notice or information item listed, staff 
estimates that 10 percent of the burden hours require managerial time 
and 90 percent require skilled technical time. As shown below, the 
total disclosure cost is $70,740,000.

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                                                                Managerial               Skilled technical               Clerical
                                                       ------------------------------------------------------------------------------------  Total cost
                     Required task                                     Cost ($50/                  Cost ($20/                  Cost ($10/        ($)
                                                        Time (hours)      hr.)      Time (hours)      hr.)      Time (hours)      hr.)
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Recordkeeping.........................................             0            $0        50,000    $1,000,000       450,000    $4,500,000    $5,500,000
                                                       =================================================================================================
Disclosure:
    Initial terms.....................................         5,033      $251,650        45,300      $906,000             0            $0    $1,157,650
    Change in terms...................................         2,350       117,500        21,150       423,000             0             0       540,500
    Periodic statements...............................        45,000     2,250,000       405,000     8,100,000             0             0    10,350,000
    Error resolution..................................        13,333       666,650       120,000     2,400,000             0             0     3,066,650
    Transaction receipts..............................       171,667     8,583,350     1,540,000    30,800,000             0             0    39,383,350
    Preauthorized transfers...........................        25,417     1,270,850       228,750     4,575,000             0             0     5,845,850
    Service provider notices..........................         2,917       145,850        26,250       525,000             0             0       670,850
    Govt. benefit notices.............................        42,167     2,108,350       379,500     7,590,000             0             0     9,698,350
    ATM Notices.......................................           116         5,800         1,050        21,000             0             0        26,800
                                                       -------------------------------------------------------------------------------------------------

[[Page 53940]]

 
      Total Disclosure................................  ............  ............  ............  ............  ............  ............    70,740,000
                                                       =================================================================================================
      Total Recordkeeping and Disclosures.............  ............  ............  ............  ............  ............  ............    76,240,000
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3. Regulation M

    The CLA requires accurate disclosure of the costs and terms of 
leases to consumers. Regulations M, 12 CFR 213, promulgated by the 
Board of Governors of the Federal Reserve System, establishes 
disclosure requirements that assist consumers in comparison shopping 
and in understanding the terms of leases and recordkeeping requirements 
that assist enforcement of the CLA. The FTC enforces the CLA as to all 
lessors and advertisers except those that are subject to the regulatory 
authority of another federal agency (such as federally chartered or 
insured depository institutions).
    Estimated annual hours burden: 279,000 hours, rounded to the 
nearest thousand (150,000 recordkeeping hours + 129,167 disclosure 
hours).
    Recordkeeping: Staff estimates that Regulation M's recordkeeping 
requirements affect approximately 150,000 firms leasing products to 
consumers and subject to the Commission's jurisdiction, at an average 
annual burden of one hour per firm, for a total of 150,000 hours.
    Disclosure: Regulation M applies to automobile lessors (such as 
auto dealers, independent leasing companies, and manufacturers' captive 
finance companies), computer lessors (such as computer dealers and 
other retailers), furniture lessors, various electronic commerce 
lessors, and diverse types of lease advertisers, and others. Below is 
staff's best estimate of burden applicable to his highly broad spectrum 
of covered entities.

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                                                                         Setup/Monitoring                      Transaction-related
                                                             -------------------------------------------------------------------------------
                                                                             Average    Total setup/                 Average       Total        Total
                         Disclosure                                         burden per   monitoring    Number of    burden per  transaction     burden
                                                              Respondents   respondent     burden    transactions  transaction     burden      (hours)
                                                                             (hours)      (hours)                   (minutes)     (hours)
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Auto Leases\1\..............................................       50,000          .75       37,500     2,500,000          .50       20,833       58,333
Other Leases\2\.............................................      100,000          .50       50,000     1,000,000          .25        4,167       54,167
Advertising.................................................       25,000          .50       12,500     1,000,000          .25        4,167       16,667
                                                             -------------------------------------------------------------------------------------------
      Total.................................................  ...........  ...........  ...........  ............  ...........  ...........     129,167
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\1\ This category focuses on consumer vehicle leases. Vehicle leasing has decreased in the past two years. Vehicle leases are subject to more lease
  disclosure requirements (pertaining to computation of payment obligations) than other lease transactions. (Only consumer leases for more than four
  months are covered.) See 15 U.S.C. 1667(1); 12 CFR 213.2(e)(1).
\2\ This category focuses on all types of consumer leases other than vehicle leases. It includes leases for computers, other electronics, small
  appliances, furniture, and other transactions. (Only consumer leases for more than four months are covered.) See 15 U.S.C. 1667(1); 12 CFR
  213.2(e)(1).

    Estimated annual cost burden: $4,621,000, rounded to the nearest 
thousand.
    Staff calculated labor costs by applying appropriate hourly cost 
figures to the burden hours described above. The hourly rates used 
below ($50 for managerial or professional time, $20 for skilled 
technical time, and $10 for clerical time) are averages.
    Recordkeeping: For the 150,000 recordkeeping hours, staff estimates 
that 10 percent of the burden hours require skilled technical time and 
90 percent require clerical time. As shown below, the total 
recordkeeping costs is $1,650,000.
    Disclosure: For each notice or information item listed, staff 
estimates that 10 percent of the burden hours require managerial time 
and 90 percent require skill technical time. As shown below, the total 
disclosure cost is $2,970,850.

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                                                                Managerial               Skilled technical               Clerical
                                                       ------------------------------------------------------------------------------------  Total cost
                     Required task                                     Cost ($50/                  Cost ($20/                  Cost ($10/        ($)
                                                        Time (hours)      hr.)      Time (hours)      hr.)      Time (hours)      hr.)
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Recordkeeping.........................................             0            $0        15,000      $300,000       135,000    $1,350,000    $1,650,000
                                                       =================================================================================================
Disclosures
    Auto Leases.......................................         5,833      $291,650        52,500    $1,050,000             0            $0    $1,341,650
    Other Leases......................................         5,417       270,850        48,750       975,000             0             0     1,245,850
    Advertising.......................................         1,667        83,350        15,000       300,000             0             0       383,350
                                                       -------------------------------------------------------------------------------------------------
      Total Disclosures...............................  ............  ............  ............  ............  ............  ............     2,970,850
                                                       =================================================================================================
      Total Recordkeeping and Disclosures.............  ............  ............  ............  ............  ............  ............     4,620,850
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[[Page 53941]]

4. Regulation Z

    The TILA was enacted for foster comparison credit shopping and 
informed credit decision making by requiring accurate disclosure of the 
costs and terms of credit to consumers. Regulation, Z, 12 CFR 226, 
promulgated by the Board of Governors of the Federal Reserve System, 
establishes both recordkeeping and disclosure requirements to assist 
consumers and the enforcement of the TILA. The FTC enforces the TILA as 
to all creditors and advertisers except those that are subject to the 
regulatory authority of another federal agency (such as federally 
chartered or insured depository institutions).
    Estimated annual hours burden: 20,179,000 hours, rounded to the 
nearest thousand (1,000,000 recordkeeping hours + 19,178,749 disclosure 
hours).
    Recordkeeping: FTC staff estimates that Regulation Z's 
recordkeeping requirements affect approximately 1,000,000 firms 
offering credit and subject to the Commission's jurisdiction, at an 
average annual burden of one hour per firm, for a total of 1,000,000 
hours.
    Disclosure: Regulation Z disclosure requirements pertain to open-
end and closed-end credit. The Regulation applies to retailers (such as 
department stores, appliance stores, discount retailers, medical-dental 
service providers, home improvement sellers, and electronic commerce 
retail operators); mortgage companies; finance companies; credit 
advertisers; auto dealerships; student loan companies; home fuel or 
power services (for furnaces, stoves, microwaves, and other heating, 
cooling or residential power equipment); credit advertisers; and 
others. Below is staff's best estimate of burden applicable to this 
highly broad spectrum of covered entities.

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                                                         Setup/monitoring                               Transaction-related
                                         ------------------------------------------------------------------------------------------------
                                                                                                          Average burden                   Total burden
             Disclosure \1\                               Average burden   Total setup/      Number of          per            Total          (hours)
                                            Respondents   per respondent    monitoring     transactions     transaction     transaction
                                                              (hours)     burden (hours)                     (minutes)    burden (hours)
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Open-end credit:
    Initial terms.......................         100,000              .5          50,000      50,000,000             .25         208,333         258,333
    Rescission notices..................          10,000              .5           5,000         100,000             .25             417           5,417
    Change in terms.....................          25,000              .5          12,500     136,000,000            .125         283,333         295,833
    Periodic statements.................         100,000              .5          50,000   4,800,000,000           .0625       5,000,000       5,050,000
    Error resolution....................         100,000              .5          50,000      10,000,000               5         833,333         883,333
    Credit and charge card accounts.....         100,000              .5          50,000      50,000,000             .25         208,333         258,333
    Home equity lines of credit.........          10,000              .5           5,000       5,000,000             .25          20,833          25,833
    Advertising.........................         250,000             .25          62,500         700,000              .5            5833          68,333
Closed-end credit:
    Credit disclosures..................         800,000             .50         400,000     330,000,000               2      11,000,000      11,400,000
    Rescission notices..................         100,000             .50          50,000      34,000,000               1         566,667         616,667
    Variable rate mortgages.............          75,000             .50          37,500       1,800,000               2          60,000          97,500
    High rate/high fee mortgages........          50,000             .50          25,000         750,000               2          25,000          50,000
    Reverse mortgages...................          50,000             .50          25,000         150,000               1           2,500          27,500
    Advertising.........................         500,000             .25         125,000       1,000,000               1          16,667         141,667
                                         ---------------------------------------------------------------------------------------------------------------
      Total open-end credit.............  ..............  ..............  ..............  ..............  ..............  ..............       6,845,415
      Total closed-end credit...........  ..............  ..............  ..............  ..............  ..............  ..............      12,333,334
                                         ---------------------------------------------------------------------------------------------------------------
      Total credit......................  ..............  ..............  ..............  ..............  ..............  ..............     19,178,749
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\1\ In some areas, e.g., home equity lines of credit, companies have merged, changed their business focus, and/or have shifted that focus into areas not
  under the FTC's jurisdiction. Accordingly, staff's estimates account for a reduced number of respondents in these areas. Moreover, computer technology
  has further facilitated the disclosure process thereby lessening the average burden per respondent, particularly with regard to setup and monitoring.

    Estimated annual cost burden: $452,111,000, rounded to the nearest 
thousand.
    Staff calculated labor costs by applying appropriate hourly cost 
figures to the burden hours described above. The hourly rates used 
below ($50 for managerial or professional time, $20 for skilled 
technical time, and $10 for clerical time) are averages.
    Recordkeeping: For the 1,000,000 recordkeeping hours, staff 
estimates that 10 percent of the burden hours require skilled technical 
time and 90 percent require clerical time. As shown below, the total 
recordkeeping cost is $11,000,000.
    Disclosure: For each notice or information item listed, staff 
estimates that 10 percent of the burden hours require managerial time 
and 90 percent require skilled technical time. As shown below, the 
total disclosure cost is $441,111,200.

[[Page 53942]]



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                                                    Managerial                   Skilled Techincal                   Clerical
              Required task              ------------------------------------------------------------------------------------------------ Total cost ($)
                                           Time (hours)   Cost ($50/hr.)   Time (hours)   Cost ($20/hr.)   Time (hours)    Cost (10/hr.)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Recordkeeping...........................               0              $0         100,000      $2,000,000         900,000      $9,000,000     $11,000,000
                                         ===============================================================================================================
Open-end credit Disclosures:
    Initial terms.......................          25,833      $1,291,650         232,500      $4,650,000               0              $0      $5,941,650
    Rescission notices..................             542         $27,100           4,875         $97,500               0              $0        $124,600
    Change in terms.....................          29,583      $1,479,150         266,250      $5,325,000               0              $0      $6,804,150
    Periodic statements.................         505,000     $25,250,000       4,545,000     $90,900,000               0              $0    $116,150,000
    Error resolution....................          88,333      $4,416,650         795,000      15,900,000               0              $0     $20,316,650
    Credit and charge card accounts.....          25,833      $1,291,650         232,500      $4,650,000               0              $0      $5,941,650
    Home equity lines of credit.........           2,583        $129,150          23,250        $465,000               0              $0        $594,150
    Advertising.........................           6,833        $341,650          61,500      $1,230,000               0              $0      $1,571,650
                                         ---------------------------------------------------------------------------------------------------------------
      Total open-end credit.............  ..............  ..............  ..............  ..............  ..............  ..............    $157,444,500
                                         ===============================================================================================================
Closed-end credit Disclosures:
    Credit disclosures..................       1,140,000     $57,000,000      10,260,000    $205,200,000               0              $0    $262,200,000
    Rescission notices..................          61,667      $3,083,350         555,000     $11,100,000               0              $0     $14,183,350
    Variable rate mortgages.............           9,750        $487,500          87,750      $1,755,000               0              $0      $2,242,500
    High rate/high fee mortgages........           5,000        $250,000          45,000        $900,000               0              $0      $1,150,000
    Reverse mortgages...................           2,750        $137,500          24,750        $495,000               0              $0        $632,500
    Advertising.........................          14,167        $708,350         127,500      $2,550,000               0              $0      $3,258,350
                                         ---------------------------------------------------------------------------------------------------------------
      Total closed-end credit...........  ..............  ..............  ..............  ..............  ..............  ..............    $283,666,700
                                         ===============================================================================================================
      Total Disclosures.................  ..............  ..............  ..............  ..............  ..............  ..............    $441,111,200
                                         ===============================================================================================================
      Total Recordkeeping and             ..............  ..............  ..............  ..............  ..............  ..............    $452,111,200
       Disclosures......................
--------------------------------------------------------------------------------------------------------------------------------------------------------


William E. Kovacic,
General Counsel.
[FR Doc. 02-21117 Filed 8-19-02; 8:45 am]
BILLING CODE 6750-01-M