[Federal Register Volume 69, Number 84 (Friday, April 30, 2004)]
[Proposed Rules]
[Pages 23705-23706]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-9813]


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DEPARTMENT OF THE TREASURY

31 CFR Part 1


Privacy Act of 1974, Proposed Implementation

AGENCY: Internal Revenue Service, Treasury.

ACTION: Proposed rule.

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SUMMARY: In accordance with the requirements of the Privacy Act of 
1974, as amended, the Department of the Treasury gives notice of a 
proposed amendment to this part to exempt a new Internal Revenue 
Service (IRS) system of records entitled ``IRS 42.031--Anti-Money 
Laundering/Bank Secrecy Act (BSA) and Form 8300 Records'' from certain 
provisions of the Privacy Act.

DATES: Comments must be received no later than June 1, 2004.

ADDRESSES: Please submit comments to the Office of Governmental Liaison 
and Disclosure, 1111 Constitution Avenue, N:ADC:C, NW., Washington, DC 
20224. Comments will be made available for inspection at the IRS 
Freedom of Information Reading Room also located at 1111 Constitution 
Avenue, NW. The telephone number for the Reading Room is (202) 622-
5164.

FOR FURTHER INFORMATION CONTACT: IRS National Anti-Money Laundering 
Program Manager, S: C: CP:RE:AML, SBSE TEC , 19th Floor, 1601 Market 
Street, Philadelphia, PA 19106, phone (215) 861-1547

SUPPLEMENTARY INFORMATION: Under 5 U.S.C. 552a(k)(2), the head of an 
agency may promulgate rules to exempt a system of records from certain 
provisions of 5 U.S.C. 552a if the system is investigatory material 
compiled for law enforcement purposes. The IRS is hereby giving notice 
of a proposed rule to exempt IRS 42.031-the Anti-Money Laundering/Bank 
Secrecy Act (BSA) and Form 8300 Records, from certain provisions of the 
Privacy Act of 1974 pursuant to 5 U.S.C. 552a(k)(2). The proposed 
exemption is from provisions 552a(c)(3), (d), (e)(1), (e)(4)(G), 
(e)(4)(H), (e)(4)(I), and (f) because the system contains investigatory 
material compiled for law enforcement purposes. The following are the 
reasons why this system of records maintained by the IRS is exempt 
pursuant to 5 U.S.C. 552a(k)(2) of the Privacy Act of 1974.
    (1) 5 U.S.C. 552a(c)(3). These provisions of the Privacy Act 
provide 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/
her request. The reasons for exempting this system of records from the 
foregoing provisions are:
    (i) The release of disclosure accounting would put the subject of 
an investigation on notice that an investigation exists 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 which 
disclosure was 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.
    (iii) Release to the individual of the disclosure accounting would 
alert the individual as to which agencies were investigating the 
subject 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(d), (e)(4)(G), (e)(4)(H), and (f). These 
provisions of the Privacy Act relate to an individual's right to be 
notified of the existence of records pertaining to such individual; 
requirements for identifying an individual who requested access to 
records, the agency procedures relating to access to records and the 
content of the information contained in such records and the civil 
remedies available

[[Page 23706]]

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 this system of records from the 
foregoing provisions are as follows: To notify an individual at the 
individual's request of the existence of an investigative file 
pertaining to such individual or to grant access to an investigative 
file pertaining to such individual 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)(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 this system of records from the foregoing are as 
follows:
    (i) The IRS will limit the Anti-Money Laundering/Bank Secrecy Act 
(BSA) and Form 8300 Records to those relevant and necessary for 
identifying, monitoring, and responding to complaints, allegations and 
other information received concerning violations or potential 
violations of the anti-money laundering provisions of Title 31 and 
Title 26 laws. However, an exemption from the foregoing is needed 
because, particularly in the early stages of an 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 first received 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.
    (4) 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 an exemption from this provision 
has been claimed, 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.
    As required by Executive Order 12866, it has been determined that 
this proposed rule is not a significant regulatory action, and 
therefore, does not require a regulatory impact analysis.
    The regulation will not have a substantial direct effect on the 
States, on the relationship between the Federal Government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government. Therefore, it is determined that this 
proposed rule does not have federalism implications under Executive 
Order 13132.
    Pursuant to the requirements of the Regulatory Flexibility Act, 5 
U.S.C. 601-612, it is hereby certified that these regulations will not 
significantly affect a substantial number of small entities. The 
proposed rule imposes no duties or obligations on small entities.
    In accordance with the provisions of the Paperwork Reduction Act of 
1995, the Department of the Treasury has determined that this proposed 
rule would not impose new recordkeeping, application, reporting, or 
other types of information collection requirements.

List of Subjects in 31 CFR Part 1

    Privacy.

    Part 1, Subpart C of title 31 of the Code of Federal Regulations is 
amended as follows:

PART 1--[AMENDED]

    1. The authority citation for part 1 continues to read as follows:

    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.
    2. Section 1.36 paragraph (g)(1)(viii) is amended by adding the 
following text to the table in numerical order.


Sec.  1.36  Systems exempt in whole or in part from provisions of 5 
U.S.C. 522a and this part.

* * * * *
    (g) * * *
    (1) * * *
    (viii) * * *

------------------------------------------------------------------------
            Number                           Name of system
------------------------------------------------------------------------
                                * * * * *
IRS 42.031....................  Anti-Money Laundering/Bank Secrecy Act
                                 (BSA) and Form 8300 Records.
                                * * * * *
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* * * * *

    Dated: April 21, 2004.
Jesus Delgado-Jenkins,
Acting Assistant Secretary for Management.
[FR Doc. 04-9813 Filed 4-29-04; 8:45 am]
BILLING CODE 4830-01-P