[Federal Register Volume 74, Number 212 (Wednesday, November 4, 2009)]
[Notices]
[Pages 57174-57177]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-26582]


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FEDERAL TRADE COMMISSION


Agency Information Collection Activities; Submission for OMB 
Review; Comment Request

AGENCY: Federal Trade Commission.

ACTION: Notice.

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SUMMARY: The FTC is submitting the information collection requirements 
described below to the Office of Management and Budget (OMB) for 
review, as required by the Paperwork Reduction Act (PRA). Pursuant to 
the OMB regulations that implement the PRA, the Commission is providing 
this second opportunity for public comment on proposed Orders that 
would seek information from depository institutions lacking federal 
deposit insurance. The Commission plans to use this information to help 
ensure that such institutions are complying with the

[[Page 57175]]

disclosure requirements of the Federal Deposit Insurance Corporation 
Improvement Act (``FDICIA'').

DATES: Written comments must be received on or before December 4, 2009.

ADDRESSES: Interested parties are invited to submit written comments 
electronically or in paper form by following the instructions in the 
Request for Comments part of the SUPPLEMENTARY INFORMATION section 
below. Comments in electronic form should be submitted by using the 
following weblink: (https://public.commentworks.com/ftc/fdiciacompliancepra2) (and following the instructions on the web-based 
form). Comments filed in paper form should be mailed or delivered to 
the following address: Federal Trade Commission, Office of the 
Secretary, Room H-135 (Annex J), 600 Pennsylvania Avenue, NW., 
Washington, DC 20580, in the manner detailed in the SUPPLEMENTARY 
INFORMATION section below.

FOR FURTHER INFORMATION CONTACT: Hampton Newsome, (202) 326-2889, 
Attorney, Division of Enforcement, Bureau of Consumer Protection, 
Federal Trade Commission, Room NJ-2122, 600 Pennsylvania Avenue, NW., 
Washington, DC 20580.

SUPPLEMENTARY INFORMATION:

Request for Comments

    Interested parties are invited to submit written comments 
electronically or in paper form. Comments should refer to ``FDICIA 
Compliance Monitoring: Paperwork Comment; FTC File No. P094205'' to 
facilitate the organization of comments. Please note that your comment 
- including your name and your state - will be placed on the public 
record of this proceeding, including on the publicly accessible FTC 
website, at (http://www.ftc.gov/os/publiccomments.shtm).
    Because comments will be made public, they should not include any 
sensitive personal information, such as any individual's Social 
Security Number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. Comments also 
should not include any sensitive health information, such as medical 
records or other individually identifiable health information. In 
addition, comments should not include ``[t]rade secret or any 
commercial or financial information which is obtained from any person 
and which is privileged or confidential'' as provided in Section 6(f) 
of the Federal Trade Commission Act (``FTC Act''), 15 U.S.C. 46(f), and 
FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). Comments containing matter for 
which confidential treatment is requested must be filed in paper form, 
must be clearly labeled ``Confidential,'' and must comply with FTC Rule 
4.9(c).\1\
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    \1\The comment must be accompanied by an explicit request for 
confidential treatment, including the factual and legal basis for 
the request, and must identify the specific portions of the comment 
to be withheld from the public record. The request will be granted 
or denied by the Commission's General Counsel, consistent with 
applicable law and the public interest. See FTC Rule 4.9(c), 16 CFR 
4.9.(c).
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    Because paper mail addressed to the FTC is subject to delay due to 
heightened security screening, please consider submitting your comments 
in electronic form. Comments filed in electronic form should be 
submitted using the following weblink: (https://public.commentworks.com/ftc/fdiciacompliancepra2) (and following the 
instructions on the web-based form). To ensure that the Commission 
considers an electronic comment, you must file it on the web-based form 
at the weblink (https://public.commentworks.com/ftc/fdiciacompliancepra2). If this Notice appears at (www.regulations.gov/search/index.jsp), you may also file an electronic comment through that 
website. The Commission will consider all comments that regulations.gov 
forwards to it. You may also visit the FTC Website at (http://www.FTC.gov) to read the Notice and the news release describing it.
    A comment filed in paper form should include the ``FDICIA 
Compliance Monitoring: Paperwork Comment; FTC File No. P094205'' 
reference both in the text and on the envelope, and should be mailed or 
delivered to the following address: Federal Trade Commission, Office of 
the Secretary, Room H-135 (Annex J), 600 Pennsylvania Avenue, N.W., 
Washington, DC 20580. The FTC is requesting that any comment filed in 
paper form be sent by courier or overnight service, if possible, 
because U.S. postal mail in the Washington area and at the Commission 
is subject to delay due to heightened security precautions.
    All comments should additionally be submitted to: Office of 
Information and Regulatory Affairs, Office of Management and Budget, 
Attention: Desk Officer for the Federal Trade Commission. Comments 
should be submitted via facsimile to (202) 395-5167 because U.S. Postal 
Mail is subject to lengthy delays due to heightened security 
precautions.
    The FTC Act and other laws that the Commission administers permit 
the collection of public comments to consider and use in this 
proceeding as appropriate. The Commission will consider all timely and 
responsive public comments that it receives, whether filed in paper or 
electronic form. Comments received will be available to the public on 
the FTC website, to the extent practicable, at (http://www.ftc.gov/os/publiccomments.shtm). As a matter of discretion, the FTC makes every 
effort to remove home contact information for individuals from the 
public comments it receives before placing those comments on the FTC 
website. More information, including routine uses permitted by the 
Privacy Act, may be found in the FTC's privacy policy, at (http://www.ftc.gov/ftc/privacy.htm.)

Background

    In 1991, Congress enacted section 43 of FDICIA (12 U.S.C. Sec.  
1831t) in response to incidents affecting the safety of deposits in 
certain financial institutions.\2\ The law imposes several requirements 
on non-federally insured institutions. Among other things, it mandates, 
under 12 U.S.C. 1831t(b), that depository institutions lacking federal 
deposit insurance disclose to consumers in periodic statements, 
signature cards, passbooks, certificate of deposit, and advertising 
that the institution does not have federal deposit insurance and that, 
if the institution fails, the federal government does not guarantee 
that depositors will get their money back. Pursuant to 12 U.S.C. 
1831t(f), the Commission has authority to enforce the disclosure 
requirements under the FTC Act (15 U.S.C. 41 et seq.).
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    \2\ See Pub. L. No. 102-242, 105 Stat. 2236.
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    Until 2003, the Commission's appropriations authority prohibited 
the use of FTC resources to enforce those requirements.\3\ In 2005, the 
Commission sought public comment on proposed rules implementing the 
statutory disclosure requirements.\4\ In 2006, before the Commission 
issued a final rule, Congress passed substantial amendments to the 
existing requirements as part of the Financial Services Regulatory 
Relief Act of 2006 (FSRRA) (Pub. L. 109-351). The Commission thus 
sought public comment on proposed regulations that would be consistent 
with the FSRRA

[[Page 57176]]

amendments,\5\ and is currently in the process of developing those 
regulations. Institutions lacking federal deposit insurance, however, 
must comply with these statutory provisions regardless of the status of 
FTC's regulations in this area.
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    \3\Making Appropriations for Agriculture, Rural Development, 
Food and Drug Administration, and Related Agencies, for the Fiscal 
Year Ending September 30, 2004, and for Other Purposes, H.R. Conf. 
Rep. No. 108-401, 108\th\ Cong., 1st Sess., at 88 (2003).
    \4\ See 70 FR 12823 (Mar. 16, 2005).
    \5\ See 74 FR 18043 (Mar. 13, 2009).
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    Under existing law, all federally chartered and most state 
chartered depository institutions have federal deposit insurance. 
Federal deposit insurance provides a government guarantee of up to 
$250,000 per depositor in most cases. Pursuant to Federal Deposit 
Insurance Corporation and National Credit Union Administration 
requirements, federally insured banks and credit unions must display 
signs that depositors are federally insured.\6\ Although most 
depository institutions have federal deposit insurance, there are some 
exceptions. For instance, there are more than a hundred and fifty 
state-chartered credit unions in nine states that do not have federal 
deposit insurance.\7\ The credit unions in these states generally 
obtain private deposit insurance in lieu of federal insurance to 
protect members' accounts.
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    \6\ See 12 CFR Parts 328 and 740.
    \7\According to the U.S. Government Accountability Office, in 
2003, eight states had credit unions that purchase private deposit 
insurance instead of federal insurance. Since that time, at least 
one additional state has allowed credit unions to use private 
deposit insurance. Other states either require federal insurance or 
allow private insurance but do not have any privately insured credit 
unions. ``Federal Deposit Insurance Act: FTC Best Among Candidates 
to Enforce Consumer Protection Provisions,'' GAO-03-971 (Aug. 2003), 
at 7. Puerto Rican credit unions operate under a Puerto Rican 
government-backed deposit insurance system.
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    On July 13, 2009, the Commission published a notice seeking 
comments on the proposed collection described here. 74 FR 33442. No 
comments were received.

Proposed Information Collection Activities

    The FTC has the authority to compel production of data and 
information from depository institutions lacking federal deposit 
insurance through Orders issued pursuant to Section 6(b) of the FTC 
Act, 15 U.S.C. 46(b). The Commission intends to send these Orders to 
all such institutions known to it in states that allow non-federally 
insured institutions.\8\ The responses will help the Commission 
determine whether covered entities are complying with the disclosure 
requirements of 12 U.S.C. 1831t(b).
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    \8\State-chartered credit unions lacking federal deposit 
insurance will likely be the recipients. The FTC also may seek 
information from some institutions covered by the Puerto Rican 
government deposit insurance system.
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    Under the PRA, 44 U.S.C. Ch. 35, federal agencies must obtain 
approval from OMB for each ``collection of information'' they conduct 
or sponsor. ``Collection of information'' means identical 
recordkeeping, disclosure and/or reporting requirements imposed on ten 
or more members of the public. 44 U.S.C. 3502(3), 5 CFR 1320.3(c). 
Because the number of entities affected by the Commission's Orders will 
exceed that threshold, the Commission is seeking OMB clearance under 
the PRA. Pursuant to OMB regulations, 5 CFR Part 1320, that implement 
the PRA, the Commission is providing this second opportunity for public 
comment.

A. Description of the Collection of Information and Proposed Use

    The FTC proposes to seek information from up to two hundred (200) 
depository institutions lacking federal deposit insurance in the United 
States (``industry members'').
    Information sought\9\ will include, among other things:
     A brief explanation of the steps the institution takes to 
comply with the requirements of 12 U.S.C. 1831t(b).
     Samples of each non-identical periodic statement of 
account, signature card, passbook, certificate of deposit, and share 
certificate disseminated within the previous three months, with any 
individual consumer names, signatures, addresses, account numbers, or 
other personally identifying information redacted.
     Information (e.g. photographs) indicating whether the 
institution posts the disclosure required by 12 U.S.C. 1831t(b)(2) at 
each station or window where it normally receives deposits, the 
institution's principal place of business, and all the institution's 
branches where it accepts deposits or opens accounts (excluding 
automated teller machines and point of sale terminals).
     Samples of all non-identical advertising\10\ issued or 
continued in use within the previous three months.
     Samples of the non-identical cards, forms, or other 
written materials the institution uses to comply with the signed 
acknowledgment requirements for new depositors pursuant to 12 U.S.C. 
1831t(b)(3) disseminated within the previous three months with any 
individual consumer names, signatures, addresses, account numbers, or 
other personally identifying information redacted.\11\
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    \9\The Orders will not seek any information about the identity 
of individual consumers. Moreover, all documents and information 
provided in response to compulsory process, including through 
special orders authorized by Section 6(b) of the FTC Act, are exempt 
from public disclosure under Section 21(f) of the Federal Trade 
Commission Act, 15 U.S.C. Sec.  57b-2(f), and Exemption 3 of the 
Freedom of Information Act, 5 U.S.C. Sec.  552(b)(3). In addition, 
to the extent applicable, section 6(f) of the FTC Act, 15 U.S.C. 
46(f), bars the Commission from publicly disclosing trade secrets or 
confidential commercial or financial information it receives from 
persons pursuant to, among other methods, special orders authorized 
by Section 6(b) of the FTC Act. Such information also would be 
exempt from disclosure under Exemption (4) of the Freedom of 
Information Act, 5 U.S.C. 552(b)(4). Finally, under Section 21(c) of 
the FTC Act, 15 U.S.C. 57b-2(c), a person who designates a 
submission as confidential is entitled to 10 days' advance notice of 
any anticipated public disclosure by the Commission, assuming that 
the Commission has determined that the information does not, in 
fact, constitute 6(f) material. Although materials covered under one 
or more of these various sections are protected by stringent 
confidentiality constraints, the FTC Act and the Commission's rules 
authorize disclosure in limited circumstances (e.g., official 
requests by Congress, requests from other agencies for law 
enforcement purposes, and administrative or judicial proceedings). 
Even in those limited contexts, however, the Commission's rules may 
afford protections to the submitter, such as advance notice to seek 
a protective order in litigation. See 15 U.S.C. 57b-2; 16 CFR 4.9-
4.11.
    \10\As used in these Orders, the term ``advertising'' means any 
communication that the institution uses to solicit business 
including, but not limited to, printed materials, the institution's 
main internet page, radio advertisements, video advertisements 
disseminated via television, the Internet or any other means of 
online communication, and solicitations conducted via telephone.
    \11\The documents produced should exclude any information for 
which prior customer authorization is required under the Right to 
Financial Privacy Act, 12 U.S.C. 3401, et seq.
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    The Commission will use the collected information in its efforts to 
ensure that the institutions are complying with the disclosure 
requirements in 12 U.S.C. 1831t(b).

B. Estimated Hours Burden

    Based upon its knowledge of the industry, FTC staff estimates that, 
on average, the time required to gather, organize, format, and produce 
such responses will average 8 hours per Order. Thus, assuming up to 200 
recipients of the Orders, total burden would be approximately 1,600 
hours.

C. Estimated Cost Burden

    It is difficult to calculate with precision the labor costs 
associated with this data production, as they entail varying 
compensation levels of management and/or support staff among companies 
of different sizes. Managerial, legal, and clerical personnel may be 
involved in the information collection process. The FTC staff has 
assumed, conservatively, that managerial personnel and legal counsel 
will handle all of the tasks involved in gathering and producing 
responsive information, and has applied an average hourly wage of 
managerial time of

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$58.12 (4 hours per entity) and an average hourly wage of legal staff 
time of $40.87 (4 hours per entity).\12\ Thus, cumulatively, estimated 
labor costs to comply with the Orders will be $79,192 (($58.12 x 800 
hours) + ($40.87 x 800 hours)). The actual cost may be lower to the 
extent clerical personnel handle some of the tasks.
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    \12\Hourly wages are averages based on mean hourly wages shown 
in (http://www.bls.gov/oes/2008/may/naics4_551100.htm#b11-0000) 
(May 2008 ``National Industry-Specific Occupational Employment and 
Wage Estimates'') for sales and marketing managers and legal 
occupations (lawyers, paralegals, and other legal support), 
respectively.
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    Staff anticipates that industry members maintain most, if not all, 
of the material sought in the orders in the normal course of business 
because they must disclose the information to customers under existing 
law. Moreover, to the extent that information sought is not generated 
in the normal course of business, any associated non-labor cost should 
be de minimis.

Willard K. Tom,
General Counsel.
[FR Doc. E9-26582 Filed 11-03-09; 8:45 am]
BILLING CODE 6750-01-S