[Federal Register Volume 69, Number 184 (Thursday, September 23, 2004)]
[Rules and Regulations]
[Pages 56929-56930]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-21362]
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FEDERAL RESERVE SYSTEM
12 CFR Part 263
[Docket No. OP-1211]
Rules of Practice for Hearings
AGENCY: Board of Governors of the Federal Reserve System.
ACTION: Final rule.
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SUMMARY: The Board of Governors of the Federal Reserve System (the
Board) is amending its rules of practice and procedure to adjust the
maximum amount, as set by statute, of each civil money penalty (CMP)
within its jurisdiction to account for inflation. This action is
required under the Federal Civil Penalties Inflation Adjustment Act of
1990, as amended by the Debt Collection Improvement Act of 1996.
EFFECTIVE DATE: October 12, 2004.
FOR FURTHER INFORMATION CONTACT: Katherine H. Wheatley, Assistant
General Counsel (202/452-3779), or Katrina P. Sukduang, Senior Attorney
(202/452-3351), Legal Division, Board of Governors of the Federal
Reserve System, 20th and C Streets, NW., Washington, DC 20551. For
users of Telecommunication Device for the Deaf (TDD) only, contact 202/
263-4869.
SUPPLEMENTARY INFORMATION: The Federal Civil Penalties Inflation
Adjustment Act of 1990, as amended by the Debt Collection Improvement
Act of 1996, 28 U.S.C. 2461 note (FCPIA Act), requires each Federal
agency to adjust each CMP within its jurisdiction by a prescribed cost-
of-living adjustment at least once every four years. This cost-of-
living adjustment is based on the formula described in section 5(b) of
the FCPIA Act. The Board made its last adjustment in October 2000 (see
65 FR 60583).
The required cost-of-living adjustment formula is based on the
difference between the Consumer Price Index (CPI) for June of the year
preceding the adjustment (in this case, June 2003) and the CPI for June
of the year when the CMP was last set or adjusted. To calculate the
adjustment, the Board used the Department of Labor, Bureau of Labor
Statistics--All Urban Consumers tables, in which the period 1982-84 was
equal to 100, to get the CPI values.
The calculations performed for the 2004 adjustment consisted of
three categories, depending on the year in which the penalty was last
set or adjusted. For penalties that changed in 2000, the relevant CPIs
were June 2003 (183.7) and June 2000 (172.4), resulting in a CPI
increase of 6.6 percent. For
[[Page 56930]]
penalties that were last changed in 1996, the relevant CPIs were June
2003 (183.7) and June 1996 (156.7), resulting in a CPI increase of 17.2
percent. Finally, for the one penalty that had not changed since its
establishment in 1994, the relevant CPIs were June 2003 (183.7) and
June 1994 (148.0), resulting in a CPI increase of 24.1 percent.
Section 5 of the FCPIA Act provides that the adjustment amount must
be rounded before adding it to the existing penalty amount. The
rounding provision depends on the size of the penalty being adjusted.
For example, if the penalty is greater than $100 but less than or equal
to $1,000, the increase is rounded to the nearest $100; if it is
greater than $1,000 but less than or equal to $10,000, the increase is
rounded to the nearest $1,000. Because of this rounding rule, five
penalty amounts are not changing at this time. For example, the penalty
under 12 U.S.C. 3909(d) prior to the 2004 adjustment was $1,100. As
this penalty was last changed in 1996, the 17.2 percent adjustment
would be $189. Rounding that increase to the nearest $1,000 results in
an increase of $0. The penalties that are not adjusted at this time
because of this rounding formula will be adjusted at the next
adjustment cycle to take account of the entire period between the time
of their last adjustment (either 1996 or 2000) and the next adjustment
date. These unadjusted penalties include the inadvertently late or
misleading reports under 12 U.S.C. 324; 12 U.S.C. 1832(c); Tier I
penalty of 12 U.S.C. 1847(d), 3110(c); 12 U.S.C. 334, 374a, 1884; and
12 U.S.C. 3909(d).
Because the statute also prohibits initial increases that exceed 10
percent, the penalty for 42 U.S.C. 4012a(f)(5) will increase to only
$385 in 2004. This penalty was initially set at $350 in 1994, and did
not change in either the 1996 or 2000 adjustments. Accordingly, the
24.1 percent CPI increase from 1994 results in $84, which is rounded to
$100 pursuant to the rounding rules. As that increase would exceed 10
percent, the penalty was adjusted to $385.
In accordance with section 6 of the FCPIA Act, the increased
penalties set forth in this amendment apply only to violations that
occur after the date the increase takes effect.
Public Comment Not Required
This rule is not subject to the provisions of 5 U.S.C. 553
requiring notice, public participation, and deferred effective date.
The FCPIA Act provides Federal agencies with no discretion in the
adjustment of CMPs to the rate of inflation, and it also requires that
adjustments be made at least every four years. Moreover, this
regulation is ministerial and technical. For these reasons, the Board
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(b)(3)(B). These same reasons also provide the Board 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, pursuant to
the APA, 5 U.S.C. 553(d).
Regulatory Flexibility Act
The Regulatory Flexibility Act applies only to rules for which an
agency publishes a general notice of proposed rulemaking pursuant to 5
U.S.C. 553(b). See 5 U.S.C. 601(2). Because the Board has determined
for good cause that the APA does not require public notice and comment
on this final rule, we are not publishing a general notice of proposed
rulemaking. Thus, the Regulatory Flexibility Act does not apply to this
final rule.
Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
Ch. 35; 5 CFR part 1320 Appendix A.1), the Board reviewed the final
rule under the authority delegated to the Board by the Office of
Management and Budget. No collections of information pursuant to the
Paperwork Reduction Act are contained in the final rule.
List of Subjects in 12 CFR Part 263
Administrative practice and procedure, Claims, Crime, Equal Access
to Justice, Lawyers, Penalties.
Authority and Issuance
0
For the reasons set forth in the preamble, the Board of Governors
amends 12 CFR part 263 as follows:
PART 263--RULES OF PRACTICE FOR HEARINGS
0
1. The authority citation for part 263 continues to read as follows:
Authority: 5 U.S.C. 504; 12 U.S.C. 248, 324, 504, 505, 1817(j),
1818, 1828(c), 1831o, 1831p-1, 1847(b), 1847(d), 1884(b),
1972(2)(F), 3105, 3107, 3108, 3907, 3909; 15 U.S.C. 21, 78o-4, 78o-
5, 78u-2; and 28 U.S.C. 2461 note.
0
2. Section 263.65 is revised to read as follows:
263.65 Civil penalty inflation adjustments
(a) Inflation adjustments. In accordance with the Federal Civil
Penalties Inflation Adjustment Act of 1990 (28 U.S.C. 2461 note), the
Board has set forth in paragraph (b) of this section adjusted maximum
penalty amounts for each civil money penalty provided by law within its
jurisdiction. The adjusted civil penalty amounts provided in paragraph
(b) of this section replace only the amounts published in the statutes
authorizing the assessment of penalties and the previously-adjusted
amounts adopted as of October 12, 2000 and October 24, 1996. The
authorizing statutes contain the complete provisions under which the
Board may seek a civil money penalty. The increased penalty amounts
apply only to violations occurring after the effective date of this
rule.
(b) Maximum civil money penalties. The maximum civil money
penalties as set forth in the referenced statutory sections are as
follows:
(1) 12 U.S.C. 324:
(i) Inadvertently late or misleading reports, inter alia--$2,200.
(ii) Other late or misleading reports, inter alia--$27,000.
(iii) Knowingly or recklessly false or misleading reports, inter
alia--$1,250,000.
(2) 12 U.S.C. 504, 505, 1817(j)(16), 1818(i)(2) and 1972(2)(F):
(i) First tier--$6,500.
(ii) Second tier--$32,500.
(iii) Third tier--$1,250,000.
(3) 12 U.S.C. 1832(c)--$1,100.
(4) 12 U.S.C. 1847(b), 3110(a)--$32,500.
(5) 12 U.S.C. 1847(d), 3110(c):
(i) First tier--$2,200.
(ii) Second tier--$27,000.
(iii) Third tier--$1,250,000.
(6) 12 U.S.C. 334, 374a, 1884--$110.
(7) 12 U.S.C. 3909(d)--$1,100.
(8) 15 U.S.C. 78u-2:
(i) 15 U.S.C. 78u-2(b)(1)--$6,500 for a natural person and $65,000
for any other person.
(ii) 15 U.S.C. 78u-2(b)(2)--$65,000 for a natural person and
$325,000 for any other person.
(iii) 15 U.S.C. 78u-2(b)(3)--$130,000 for a natural person and
$625,000 for any other person.
(9) 42 U.S.C. 4012a(f)(5):
(i) For each violation--$385.
(ii) For the total amount of penalties assessed under 42 U.S.C
4012a(f)(5) against an institution or enterprise during any calendar
year--$125,000.
Dated: September 20, 2004.
By order of the Board of Governors of the Federal Reserve
System.
Jennifer J. Johnson,
Secretary of the Board.
[FR Doc. 04-21362 Filed 9-22-04; 8:45 am]
BILLING CODE 6210-01-P