[Federal Register Volume 76, Number 247 (Friday, December 23, 2011)]
[Rules and Regulations]
[Pages 80241-80248]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-32923]


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SOCIAL SECURITY ADMINISTRATION

20 CFR Parts 404 and 416

[Docket No. SSA-2011-0016]
RIN 0960-AH32


Revisions to Rules of Conduct and Standards of Responsibility for 
Representatives

AGENCY: Social Security Administration.

ACTION: Final rules.

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SUMMARY: We are revising our rules of conduct and standards of 
responsibility for representatives. These revisions further clarify our 
expectations regarding representatives' obligations to competently 
represent their clients and constitute official notice concerning our 
requirements and procedures. We are also updating other rules about the 
representation of parties. These changes are necessary because our 
current regulations are insufficient to address some representative 
conduct that is inappropriate, but has technically fallen outside the 
scope of our regulations. These changes will allow us to better protect 
the integrity of our administrative process, ensure that claimants 
receive competent and effective representation, and further clarify 
representatives' responsibilities in their dealings with us and with 
claimants.

DATES: These final rules are effective on January 23, 2012.

FOR FURTHER INFORMATION CONTACT: Andrew Maunz, Office of the General 
Counsel, Social Security Administration, P.O. Box 17788, Baltimore, MD 
21235-7788, (410) 965-3196. For information on eligibility or filing 
for benefits, call our national toll-free number, 1-(800) 772-1213 or 
TTY 1-(800) 325-0778, or visit our Internet site, Social Security 
Online, at http://www.socialsecurity.gov.

SUPPLEMENTARY INFORMATION:

Background

    We may issue rules and regulations to administer the Social 
Security Act (Act). 42 U.S.C. 405(a), 902(a)(5), 810(a), and 
1383(d)(1). We may issue regulations to recognize agents or other 
persons, other than attorneys, as claimant representatives. 42 U.S.C. 
406(a)(1) and 1383(d)(2). Under the cited authority, we are revising 
our rules of conduct and standards of responsibility for 
representatives and other rules about the representation of parties in 
20 CFR part 404 subparts J and R and part 416 subparts N and O.
    We published a notice of proposed rulemaking (NPRM), Revisions to 
Rules on Representation of Parties, in the Federal Register on 
September 8, 2008. 73 FR 51963. We gave the public 60 days to comment 
on the NPRM. In these final rules, we are finalizing some of our 
proposed regulatory changes. We continue to consider the rest of our 
proposed regulatory changes, and we may publish additional final rules 
that address them.

Recognition of Representatives

    We are revising our rules to state that we will notify a claimant 
and the person the claimant chooses to represent him or her if we 
decide not to recognize the person as a representative. We are also 
adding language to clarify our existing policy that we may refuse to 
recognize a person as a representative if he or she does not meet our 
requirements. We are adding this text in final 20 CFR 404.1705 and 
416.1505.
    We are also revising our rules in final 20 CFR 404.903(f) and 
416.1403(f) to state that when we decide not to recognize a person as a 
representative, our action is not an initial determination that would 
allow the person the right to further administrative action and 
judicial review.

New Rules of Conduct for Representatives

    The vast majority of representatives conduct their business before 
us ethically and do a conscientious job in assisting their clients. 
Unfortunately, there are a few representatives whose behavior requires 
us to take action to prevent them from representing claimants before 
us. The number of representatives sanctioned each year is small when 
compared to the entire universe of representatives. For example, over 
27,000 representatives were involved at the hearings level in Fiscal 
Year 2011, but we have sanctioned, on average, only 11 representatives 
per year since 2007. Nevertheless, our experience has convinced us that 
there are sufficient instances of questionable conduct to warrant 
additional regulatory authority to address representative conduct that 
is inappropriate.
    In the NPRM, we proposed to revise our list of prohibited actions 
to include: (1) Violating any section of the Act for which a criminal 
or civil monetary penalty is prescribed; (2) refusing to comply with 
any of our rules or regulations; (3) suggesting, assisting, or 
directing another person to violate our rules or regulations; (4) 
advising any claimant or beneficiary not to comply with any of our 
rules or regulations; and (5) failing to comply with our decision about 
sanctions. We are adopting these revisions because they will help us 
ensure that representatives comply with our rules.
    We are also adding an additional prohibited action: a 
representative may not help a suspended or disqualified person provide 
representational services. Specifically, the representative may not 
knowingly assist a suspended

[[Page 80242]]

or disqualified person to provide representational services in a 
proceeding under titles II or XVI of the Act or to exercise the 
authority of a representative described in 20 CFR 404.1710 and 
416.1510. In response to public comments, we are adopting final 
regulatory language different from that which we proposed for 20 CFR 
404.1740(c)(12) and 416.1540(c)(12).
    We are including these rules in final 20 CFR 404.1740 and 416.1540.

Delegations of Authority

    To reflect an internal reorganization and a revised delegation of 
authority, we are also changing references to agency titles in several 
sections. These include changing the ``Deputy Commissioner for 
Disability and Income Security Programs'' to the ``General Counsel'' 
and the ``Associate Commissioner for Hearings and Appeals'' to the 
``Deputy Commissioner for Disability Adjudication and Review.'' We are 
adding these revisions and making other technical changes in final 20 
CFR 404.1750, 404.1755, 404.1765, 404.1799, 416.1550, 416.1555, 
416.1565, and 416.1599.

Other Changes

    We are adding, moving, and revising three current definitions to 
final 20 CFR 404.1703 and 416.1503. These definitions are for: 
``Federal agency,'' ``Federal program,'' and ``representational 
services.'' We revised the proposed definition for ``representational 
services'' in response to public comments.
    Because we are adding the definition of ``representational 
services'' in final 20 CFR 404.1703 and 416.1503 from language in 
current 20 CFR 404.1735 and 416.1535, there would not be any regulatory 
text remaining in 20 CFR 404.1735 and 416.1535. Therefore, we are 
removing and reserving final 20 CFR 404.1735 and 416.1535.
    Finally, we are making other minor conforming and nonsubstantive 
changes.

Public Comments

    We published an NPRM in the Federal Register on September 8, 2008, 
and we gave the public 60 days to comment on our proposed rules. 73 FR 
51963. We received comments from 66 individuals and organizations 
during this period. We carefully read and considered each of them. You 
can view the public comments at http://www.regulations.gov.
    The comments we received were detailed and insightful, and they 
were extremely helpful to our deliberations. This final rule contains a 
number of changes from our NPRM and reflects the commenters' thoughtful 
input. Below, we discuss and respond to the significant comments 
related to the proposals on the recognition of representatives and our 
standards of conduct. We did not address comments that were beyond the 
NPRM's scope. We also did not address comments about the proposed 
regulatory changes that we are still considering and may adopt in 
future final rules.

Rules of Conduct for Representatives

    Comment: One commenter said that our proposed rules of conduct and 
standards of responsibility for representatives made our process 
adversarial.
    Response: Our claims process is nonadversarial, but actions brought 
under our rules of conduct for representatives are adversarial. These 
final rules do not change this distinction.
    Comment: A few commenters asked us to clarify what we meant in 
proposed 20 CFR 404.1740(c)(12) and 416.1540(c)(12), which stated that 
a representative may not ``[a]ssist another person whom we have 
suspended or disqualified.'' A few commenters wanted us to allow 
representatives to accept cases from persons whom we have suspended or 
disqualified. Another commenter wanted us to allow representatives to 
employ a suspended or disqualified person if the suspended or 
disqualified person does not have direct client contact.
    Response: We clarified this language to explain more clearly the 
types of activities that will violate our rules of conduct. We are 
adopting final 20 CFR 404.1740(c)(12) and 416.1540(c) (12) to state 
that a representative may not knowingly assist a person whom we 
suspended or disqualified to provide representational services in a 
proceeding under titles II or XVI of the Act, or to exercise the 
authority of a representative described in 20 CFR 404.1710 and 
416.1510.
    This language permits a representative to employ a suspended or 
disqualified person if the suspended or disqualified person does not 
provide any of the noted services. For example, a suspended or 
disqualified person may provide clerical help to a representative. 
However, a representative will likely violate our rules if the 
representative knowingly permits the suspended or disqualified person 
to have substantive client contact or to work on the substantive 
aspects of a claim.
    Comment: One commenter stated that our proposed additional rules of 
conduct for representatives would deter potential representatives, such 
as attorneys, from representing claimants before us.
    Response: We did not adopt this comment. Every representative has 
an interest in ensuring that only the most competent, knowledgeable, 
and principled individuals represent claimants before us. Individuals 
undertaking the responsibility of representing claimants before us 
should understand that we have an interest in protecting claimants and 
ensuring the integrity of our administrative process. Additional 
conduct rules should not deter these potential representatives.
    Comment: A few commenters expressed concern that some of our 
regulatory language in proposed 20 CFR 404.1740 and 416.1540 was too 
vague. Some commenters mentioned specific language that they thought 
was too vague.
    Response: We do not agree with these comments. Much of the language 
that the commenters cited is already part of our current rules, such as 
the terms ``prompt and responsive answers,'' ``unreasonably delay,'' 
and ``threatening or intimidating language, gestures, or actions.'' 
Current 20 CFR 404.1740(b)(3)(ii), (c)(4), (c)(7), 416.1540(b)(3)(ii), 
(c)(4), and (c)(7). We proposed changes to these sections only to 
clarify them. Because we did not propose other substantive changes to 
these rules, we do not believe that we should revise them now.
    We believe that the remaining proposed regulatory language 
sufficiently describes and gives adequate notice of the types of 
actions that would violate our rules of conduct. These regulations are 
similar to other standards of conduct, such as the American Bar 
Association Model Rules, because they do not list every act or omission 
that might constitute a violation of the rules of conduct. Developing 
this type of list would be inappropriate and virtually impossible to 
complete because representing claimants involves limitless factual 
situations. Rather, we deal with each complaint on a case-by-case basis 
to determine whether a representative engaged in actionable misconduct 
under the attending circumstances. When we decide whether to bring an 
action against a representative, we consider whether a reasonable 
person, in light of all the circumstances, would consider the act or 
omission a violation of the relevant rule.
    Comment: One commenter wanted our process to include a system of 
review and appeal.
    Response: We already have an appeals process for actions brought 
under our

[[Page 80243]]

rules of conduct for representatives. Either party to a representative 
disqualification or suspension action may ask the Appeals Council to 
review the hearing officer's decision. Current 20 CFR 404.1775 and 
416.1575. The Appeals Council will assign a panel of three 
administrative appeals judges to consider and rule on the request for 
review. Current 20 CFR 404.1776 and 416.1576. These final rules do not 
change our current rules on this issue.
    Comment: Several commenters wanted us to add the word ``knowingly'' 
to our proposed prohibited actions for representatives in proposed 20 
CFR 404.1740(c)(8)-(13) and 416.1540(c)(8)-(13). They argued that we 
should only disqualify or suspend representatives who knowingly violate 
our rules.
    Response: After careful consideration, we have adopted this comment 
for final 20 CFR 404.1740(c)(12) and 416.1540(c)(12). A representative 
will violate the rules of conduct for representatives if he or she 
knowingly assists a person, whom we suspended or disqualified, to 
provide representational services or to exercise the authority of a 
representative.
    However, we did not adopt this comment for final 20 CFR 
404.1740(c)(8)-(11) and (13) and 416.1540(c)(8)-(11) and (13) because 
each remaining prohibited action requires knowledge on the part of the 
representative. For example, one cannot unknowingly ``refuse to comply 
with any of our rules or regulations.'' Final 20 CFR 404.1740(c)(9) and 
416.1540(c)(9). Moreover, the Act already states that only ``knowing'' 
violations will subject a representative to criminal and civil monetary 
penalties. See 42 U.S.C. 406(a)(5) and (b)(2), 408(a), 1011(a), 
1307(a), and 1383a(a).
    Comment: One commenter asked us to explain whether we will prohibit 
a representative from serving as a vocational expert or working for an 
insurance company if we deem them a ``fiduciary'' of a claimant in 
proposed 20 CFR 404.1740(a)(1) and 416.1540(a)(1).
    Response: The term ``fiduciary'' exists in our current regulations. 
We proposed to clarify these sections in the NPRM. Our current rules do 
not specifically prohibit a representative from serving as a vocational 
expert or from working for an insurance company. However, we preclude a 
person from serving as a vocational expert in a claim in which the 
person is also the claimant's representative.
    Comment: One commenter objected to our proposed language that 
required representatives to ``provid[e] prompt and responsive answers 
to requests from the Agency for information pertinent to processing of 
the claim.'' Proposed 20 CFR 404.1740(b)(3)(ii) and 416.1540(b)(3)(ii). 
The commenter asserted that representatives may be unable to comply 
with this requirement because third-party medical providers sometimes 
do not respond to properly submitted information requests.
    Response: We added this affirmative duty to our regulations in 
1998. 63 FR 41404. Our current rule requires a representative to: ``Act 
with reasonable diligence and promptness in representing a claimant. 
This includes providing prompt and responsive answers to [our] requests 
[] for information pertinent to processing of the claim.'' Current 20 
CFR 404.1740(b)(3)(ii) and 416.1540(b)(3)(ii). These final rules do not 
require a representative to give us documents that the representative, 
despite diligent effort, could not obtain. We are not imposing any new 
or enhanced duties on representatives.
    In the NPRM, we proposed to change punctuation in proposed 20 CFR 
404.1740(b)(3)(ii) and 416.1540(b)(3)(ii) only to allow us to propose 
20 CFR 404.1740(b)(3)(iii) and 416.1540(b)(3)(iii) (a proposed 
affirmative duty for representatives to maintain a paper copy of our 
appointment form, with original signatures, and to provide it to us on 
request). Since we are still considering whether to add this 
affirmative duty, we are not revising the current regulatory text at 
this time.
    Comment: A few commenters thought our prohibited action in proposed 
20 CFR 404.1740(c)(9) and 416.1540(c)(9) to ``[r]efuse to comply with 
any of our rules or regulations'' was overbroad. These commenters 
wanted an exception that would allow a representative to not comply 
with our rules and regulations if the representative is challenging the 
validity or applicability of the rule or regulation. Another commenter 
said that we should limit our proposed prohibited action to situations 
where there are no non-frivolous bases for the action. The commenter 
suggested that we look to Oregon's Rule of Professional Conduct 3.1 
(Meritorious Claims and Contentions), which states that a lawyer must 
have a non-frivolous legal and factual basis for any action and must be 
able to make a good faith argument for the action.
    Response: This proposed prohibited action comes directly from the 
Act: ``The Commissioner * * * may, after due notice and opportunity for 
hearing, suspend or prohibit from further practice before the 
Commissioner any[one] * * * who refuses to comply with the 
Commissioner's rules and regulations or who violates any provision of 
this section for which a penalty is prescribed.'' 42 U.S.C. 406(a)(1). 
Additionally, our current regulations state, ``When we have evidence 
that a representative * * * has violated the rules governing dealings 
with us, we may begin proceedings to suspend or disqualify that 
individual from acting in a representational capacity before us.'' 
Current 20 CFR 404.1745 and 416.1545.
    Therefore, representatives are already on notice that we require 
them to comply with all of our rules, and we continue to believe that 
this is a reasonable requirement for representatives who want to 
practice before us. Our NPRM merely proposed to insert this statement 
of an existing requirement into our rules of conduct and standards of 
responsibility for representatives in proposed 20 CFR 404.1740 and 
416.1540. Where our regulations conflict with a representative's State 
bar rules, our rules take precedence in our administrative proceedings. 
However, a representative should comply with a State bar rule that is 
more restrictive than our requirements.
    We expect all representatives to comply with our rules and 
regulations. We currently assess each conduct complaint on its own 
merits to determine whether a person engaged in actionable misconduct. 
These final rules will not change this practice. A person may tell us 
that he or she is contesting a regulation's applicability or validity. 
If the person has a good faith, non-frivolous basis for refusing to 
follow one or more of our rules and regulations, we will seriously 
evaluate that basis before we decide whether to bring a 
disqualification or suspension proceeding.
    We are therefore not adopting the commenters' suggested change in 
the final regulatory language.
    Comment: One commenter asserted that several of our proposed 
prohibited actions sought to regulate speech in violation of the First 
Amendment to the Constitution and attorney-client privilege. 
Specifically, the commenter stated that our proposed 20 CFR 
404.1740(c)(9)-(11) and 416.1540(c)(9)-(11) would interfere with the 
content of advice that an attorney could give a client.
    Response: We disagree with these comments. Congress specifically 
authorized us to promulgate rules and regulations to administer the Act 
and to prescribe rules and regulations governing the recognition of 
agents who represent ``claimants before the

[[Page 80244]]

Commissioner of Social Security.'' See 42 U.S.C. 405(a), 406(a), and 
1383(d)(2). Congress further stated that, after receiving due notice 
and an opportunity for a hearing, the Commissioner may suspend or 
prohibit from further practice before the agency any representative who 
refuses to comply with the Commissioner's rules and regulations or who 
violates any provision of this section for which a penalty is 
prescribed.
    Representatives may share their opinions and have frank discussions 
with their clients. Our rule will not limit the freedom of speech 
guaranteed in the First Amendment to the Constitution or interfere with 
the attorney-client relationship or client confidentiality. We are not 
asking anyone to disclose information protected by the attorney-client 
privilege or the attorney work-product doctrine. However, similar to a 
court's responsibility to regulate admission to the practice of law 
before it, and as was recognized by Congress, we have a responsibility 
to regulate those persons who represent claimants before us. 
``Membership in the bar'' and the ability to practice before an 
administrative agency ``is a privilege burdened with conditions.'' 
Gentile v. State Bar of Nevada, 501 U.S. 1030, 1066 (1991). The Supreme 
Court recently cited with approval ABA Model Rule of Professional 
Conduct 1.2(d), which states that a ```lawyer shall not counsel a 
client to engage, or assist a client, in conduct that the lawyer knows 
is criminal or fraudulent, but a lawyer may discuss the legal 
consequences of any proposed course of conduct with a client and may 
counsel or assist a client to make a good faith effort to determine the 
validity, scope, meaning or application of the law.''' Milavetz, Gallop 
& Milavetz, P.A. v. United States, 130 S. Ct. 1324, 1337-38 (2010). See 
Model Rules of Prof'l Conduct R. 1.2(d) (2011). While our rules and 
regulations govern more than just lawyers, the same principles apply to 
all representatives.
    We have broad rulemaking authority to decide what types of 
representation-related misconduct are unacceptable. We decided that 
representatives cannot practice before us if they refuse to comply with 
our rules and regulations or advise claimants not to comply with our 
rules and regulations. These rules further our interest in regulating 
representatives, ensuring compliance with our laws and rules, and 
administering our programs efficiently.

Recognition of Representatives

    Comment: One commenter wanted to know if our refusal to recognize a 
representative in one claim would apply to future cases in which a 
different claimant tries to appoint the same representative.
    Response: As is our current process, we will reassess an 
individual's qualifications each time a claimant requests that 
individual to be a representative. Once the individual meets our 
criteria in final 20 CFR 404.1705 and 416.1505, we will recognize him 
or her as a representative. Once we recognize a person as a 
representative, additional claimants may appoint the recognized 
representative to serve as a representative.
    Comment: A few commenters want our rules to clarify that a 
representative can appeal our refusal to recognize an appointment 
because the representative did not meet our criteria. Another commenter 
asserted that we must give a representative due process, notice, and 
the opportunity to respond if we refuse to recognize a claimant's 
appointment of a representative.
    Response: The Act grants us authority to ``prescribe rules and 
regulations governing the recognition of'' non-attorney 
representatives. It also permits us to require representatives, before 
we recognize them, to ``show that they are of good character and in 
good repute, possessed of the necessary qualifications to enable them 
to render such claimants valuable service, and otherwise competent to 
advise and assist such claimants in the presentation of their cases.'' 
42 U.S.C. 406(a)(1) and 1383a(a).
    If a claimant submits a request to appoint a person as his or her 
representative and that person has not previously represented claimants 
before us, we will not recognize the appointment if we know that the 
person does not meet our requirements. Current 20 CFR 404.1705 and 
416.1505. However, if we have previously allowed the person to 
represent a claimant, we will continue to allow the person to represent 
claimants until we obtain a final decision disqualifying or suspending 
the person from further representation before us, following notice and 
an opportunity for a hearing. Current 20 CFR 404.1705 and 416.1505. We 
are clarifying this distinction by revising our proposed regulatory 
language in these sections.
    Our decision not to recognize a person as a representative is not 
an initial determination that would allow the person the right to 
further administrative action and judicial review. Current 20 CFR 
404.903(f) and 416.1403(f). If we do not recognize a person as a 
representative, we will notify that person and the claimant of our 
action.
    Comment: Two commenters thought our language in proposed 20 CFR 
404.1705(c) and 416.1505(c) was confusing. One commenter asked which 
``requirements'' we meant when we proposed: ``We may refuse to 
recognize your appointed representative if the representative does not 
meet our requirements.'' Another commenter proposed alternative 
regulatory language to clarify the persons whom we will notify of our 
refusal to recognize an appointment.
    Response: We agree with the commenters that the proposed language 
was unclear. We revised these final sections to clarify that a 
claimant's chosen representative must meet our requirements in 20 CFR 
404.1705 and 416.1505 before we recognize the appointment. We also 
revised these final sections to clarify that a person whose appointment 
we do not recognize is not a ``representative'' under our rules and 
that we will notify the claimant and the person the claimant attempted 
to appoint if we do not recognize the appointment.

Definitions

    Comment: One commenter opposed our proposal to move the definition 
of ``disqualified'' from current 20 CFR 404.1770(a)(2)(i) and 
416.1570(a)(2)(i) to ``disqualify'' in proposed 20 CFR 404.1703 and 
416.1503. The commenter said that this would cause confusion because 
our rules use the term in two different ways.
    Response: We agree with this comment. We are keeping the definition 
in its current location in 20 CFR 404.1770(a)(2) and 416.1570(a)(2). 
However, we are adopting, with minor changes, our proposed definition 
for ``disqualify'' and are retaining our proposed language in 20 CFR 
404.1770(a)(2) and 416.1570(a)(2).

Regulatory Procedures

Executive Order 12866, as Supplemented by Executive Order 13563

    We consulted with the Office of Management and Budget (OMB) and 
determined that these final rules meet the criteria for a significant 
regulatory action under Executive Order 12866, as supplemented by 
Executive Order 13563. Therefore, OMB reviewed them.

Regulatory Flexibility Act

    We certify that this final rule will not have a significant 
economic impact on a substantial number of small entities because it 
affects individuals only.

[[Page 80245]]

Therefore, a regulatory flexibility analysis is not required under the 
Regulatory Flexibility Act, as amended.

Paperwork Reduction Act

    These final rules contain information collection activities at 20 
CFR 404.1755 and 404.1799. However, 44 U.S.C. 3518(c)(1)(B)(ii) exempts 
these activities from the OMB clearance requirements under the 
Paperwork Reduction Act of 1995.

(Catalog of Federal Domestic Assistance Program Nos. 96.001, Social 
Security-Disability Insurance; 96.002, Social Security-Retirement 
Insurance; 96.004, Social Security-Survivors Insurance; and 96.006, 
Supplemental Security Income)

List of Subjects

20 CFR Part 404

    Administrative practice and procedure, Blind, Disability benefits, 
Old-age, survivors, and disability insurance, Penalties, Reporting and 
recordkeeping requirements, Social Security.

20 CFR Part 416

    Administrative practice and procedure, Penalties, Reporting and 
recordkeeping requirements, Supplemental Security Income (SSI).

Michael J. Astrue,
Commissioner of Social Security.

    For the reasons set out in the preamble, we are amending 20 CFR 
part 404 subparts J and R and part 416 subparts N and O as set forth 
below:

PART 404--FEDERAL OLD-AGE, SURVIVORS AND DISABILITY INSURANCE 
(1950-)

Subpart J--[Amended]

0
1. The authority citation for subpart J of Part 404 continues to read 
as follows:

    Authority:  Secs. 201(j), 204(f), 205(a)-(b), (d)-(h), and (j), 
221, 223(i), 225, and 702(a)(5) of the Social Security Act (42 
U.S.C. 401(j), 404(f), 405(a)-(b), (d)-(h), and (j), 421, 423(i), 
425, and 902(a)(5)); sec. 5, Pub. L. 97-455, 96 Stat. 2500 (42 
U.S.C. 405 note); secs. 5, 6(c)-(e), and 15, Pub. L. 98-460, 98 
Stat. 1802 (42 U.S.C. 421 note); sec. 202, Pub. L. 108-203, 118 
Stat. 509 (42 U.S.C. 902 note).


0
2. Amend Sec.  404.903 by revising paragraph (g) to read as follows:


Sec.  404.903  Administrative actions that are not initial 
determinations.

* * * * *
    (g) Refusing to recognize, disqualifying, or suspending a person 
from acting as your representative in a proceeding before us (see 
Sec. Sec.  404.1705 and 404.1745);
* * * * *

Subpart R--[Amended]

0
3. The authority citation for subpart R of part 404 continues to read 
as follows:

    Authority:  Secs. 205(a), 206, 702(a)(5), and 1127 of the Social 
Security Act (42 U.S.C. 405(a), 406, 902(a)(5), and 1320a-6).


0
4. Amend Sec.  404.1703 by adding definitions for ``Federal agency'', 
``Federal program'', and ``representational services'' in alphabetical 
order to read as follows:


Sec.  404.1703  Definitions.

* * * * *
    Federal agency refers to any authority of the Executive branch of 
the Government of the United States.
    Federal program refers to any program established by an Act of 
Congress or administered in whole or in part by a Federal agency.
* * * * *
    Representational services means services performed for a claimant 
in connection with any claim the claimant has before us, any asserted 
right the claimant may have for an initial or reconsidered 
determination, and any decision or action by an administrative law 
judge or the Appeals Council.
* * * * *

0
5. Amend Sec.  404.1705 by removing the heading for paragraphs (a) and 
(b), revising paragraph (b) introductory text, and adding paragraph (c) 
to read as follows:


Sec.  404.1705  Who may be your representative.

* * * * *
    (b) You may appoint any person who is not an attorney to be your 
representative in dealings with us if the person--
* * * * *
    (c) We may refuse to recognize the person you choose to represent 
you if the person does not meet the requirements in this section. We 
will notify you and the person you attempted to appoint as your 
representative if we do not recognize the person as a representative.


0
6. Remove and reserve Sec.  404.1735 to read as follows:


Sec.  404.1735  [Reserved].

0
7. Amend Sec.  404.1740 by revising paragraphs (a)(1), (a)(2), (b) 
introductory text, (c) introductory text, (c)(6), and (c)(7)(iii), and 
adding paragraphs (c)(8) through (c)(13), to read as follows:


Sec.  404.1740  Rules of conduct and standards of responsibility for 
representatives.

    (a) * * * (1) All attorneys or other persons acting on behalf of a 
party seeking a statutory right or benefit must, in their dealings with 
us, faithfully execute their duties as agents and fiduciaries of a 
party. A representative must provide competent assistance to the 
claimant and recognize our authority to lawfully administer the 
process. The following provisions set forth certain affirmative duties 
and prohibited actions that will govern the relationship between the 
representative and us, including matters involving our administrative 
procedures and fee collections.
    (2) All representatives must be forthright in their dealings with 
us and with the claimant and must comport themselves with due regard 
for the nonadversarial nature of the proceedings by complying with our 
rules and standards, which are intended to ensure orderly and fair 
presentation of evidence and argument.
    (b) Affirmative duties. A representative must, in conformity with 
the regulations setting forth our existing duties and responsibilities 
and those of claimants (see Sec.  404.1512 in disability and blindness 
claims):
* * * * *
    (c) Prohibited actions. A representative must not:
* * * * *
    (6) Attempt to influence, directly or indirectly, the outcome of a 
decision, determination, or other administrative action by offering or 
granting a loan, gift, entertainment, or anything of value to a 
presiding official, agency employee, or witness who is or may 
reasonably be expected to be involved in the administrative 
decisionmaking process, except as reimbursement for legitimately 
incurred expenses or lawful compensation for the services of an expert 
witness retained on a non-contingency basis to provide evidence;
    (7) * * *
    (iii) Threatening or intimidating language, gestures, or actions 
directed at a presiding official, witness, or agency employee that 
result in a disruption of the orderly presentation and reception of 
evidence;
    (8) Violate any section of the Act for which a criminal or civil 
monetary penalty is prescribed;
    (9) Refuse to comply with any of our rules or regulations;
    (10) Suggest, assist, or direct another person to violate our rules 
or regulations;

[[Page 80246]]

    (11) Advise any claimant or beneficiary not to comply with any of 
our rules or regulations;
    (12) Knowingly assist a person whom we suspended or disqualified to 
provide representational services in a proceeding under title II of the 
Act, or to exercise the authority of a representative described in 
Sec.  404.1710; or
    (13) Fail to comply with our sanction(s) decision.


0
8. Amend Sec.  404.1750 by revising paragraphs (a) and (d) to read as 
follows:


Sec.  404.1750  Notice of charges against a representative.

    (a) The General Counsel or other delegated official will prepare a 
notice containing a statement of charges that constitutes the basis for 
the proceeding against the representative.
* * * * *
    (d) The General Counsel or other delegated official may extend the 
30-day period for good cause in accordance with Sec.  404.911.
* * * * *

0
9. Revise Sec.  404.1755 to read as follows:


Sec.  404.1755  Withdrawing charges against a representative.

    The General Counsel or other delegated official may withdraw 
charges against a representative. We will withdraw charges if the 
representative files an answer, or we obtain evidence, that satisfies 
us that we should not suspend or disqualify the representative from 
acting as a representative. When we consider withdrawing charges 
brought under Sec.  404.1745(d) or (e) based on the representative's 
assertion that, before or after our filing of charges, the 
representative has been reinstated to practice by the court, bar, or 
Federal program or Federal agency that suspended, disbarred, or 
disqualified the representative, the General Counsel or other delegated 
official will determine whether such reinstatement occurred, whether it 
remains in effect, and whether he or she is reasonably satisfied that 
the representative will in the future act in accordance with the 
provisions of section 206(a) of the Act and our rules and regulations. 
If the representative proves that reinstatement occurred and remains in 
effect and the General Counsel or other delegated official is so 
satisfied, the General Counsel or other delegated official will 
withdraw those charges. The action of the General Counsel or other 
delegated official regarding withdrawal of charges is solely that of 
the General Counsel or other delegated official and is not reviewable, 
or subject to consideration in decisions made under Sec. Sec.  404.1770 
and 404.1790. If we withdraw the charges, we will notify the 
representative by mail at the representative's last known address.


0
10. Amend Sec.  404.1765 by revising paragraphs (a) and (b)(1), the 
second sentence of paragraph (e), and paragraph (l) to read as follows:


Sec.  404.1765  Hearing on charges.

    (a) Holding the hearing. If the General Counsel or other delegated 
official does not take action to withdraw the charges within 15 days 
after the date on which the representative filed an answer, we will 
hold a hearing and make a decision on the charges.
    (b) Hearing officer. (1) The Deputy Commissioner for Disability 
Adjudication and Review or other delegated official will assign an 
administrative law judge, designated to act as a hearing officer, to 
hold a hearing on the charges.
* * * * *
    (e) * * * The General Counsel or other delegated official will also 
be a party to the hearing.
* * * * *
    (l) Representation. The representative, as the person charged, may 
appear in person and may be represented by an attorney or other 
representative. The General Counsel or other delegated official will be 
represented by one or more attorneys from the Office of the General 
Counsel.
* * * * *

0
11. Amend Sec.  404.1770 by revising the first sentence of paragraph 
(a)(1), paragraphs (a)(2), (a)(3) introductory text, and the second 
sentence of (a)(3)(ii) to read as follows:


Sec.  404.1770  Decision by hearing officer.

    (a) General. (1) After the close of the hearing, the hearing 
officer will issue a decision or certify the case to the Appeals 
Council. * * *
    (2) In deciding whether a person has been, by reason of misconduct, 
disbarred or suspended by a court or bar, or disqualified from 
participating in or appearing before any Federal program or Federal 
agency, the hearing officer will consider the reasons for the 
disbarment, suspension, or disqualification action. If the action was 
taken for solely administrative reasons (e.g., failure to pay dues or 
to complete continuing legal education requirements), that will not 
disqualify the person from acting as a representative before us. 
However, this exception to disqualification does not apply if the 
administrative action was taken in lieu of disciplinary proceedings 
(e.g., acceptance of a voluntary resignation pending disciplinary 
action). Although the hearing officer will consider whether the 
disbarment, suspension, or disqualification action is based on 
misconduct when deciding whether a person should be disqualified from 
acting as a representative before us, the hearing officer will not re-
examine or revise the factual or legal conclusions that led to the 
disbarment, suspension, or disqualification. For purposes of 
determining whether a person has been, by reason of misconduct, 
disqualified from participating in or appearing before any Federal 
program or Federal agency, disqualified refers to any action that 
prohibits a person from participating in or appearing before any 
Federal program or Federal agency, regardless of how long the 
prohibition lasts or the specific terminology used.
    (3) If the hearing officer finds that the charges against the 
representative have been sustained, he or she will either--
* * * * *
    (ii) * * * Disqualification is the sole sanction available if the 
charges have been sustained because the representative has been 
disbarred or suspended from any court or bar to which the 
representative was previously admitted to practice or disqualified from 
participating in or appearing before any Federal program or Federal 
agency, or because the representative has collected or received, and 
retains, a fee for representational services in excess of the amount 
authorized.
* * * * *

0
12. Amend Sec.  404.1799 by revising paragraphs (b), (c), (d)(3), and 
(e) to read as follows:


Sec.  404.1799  Reinstatement after suspension or disqualification--
period of suspension not expired.

* * * * *
    (b) The suspended or disqualified person must submit any evidence 
the person wishes to have considered along with the request to be 
allowed to serve as a representative again.
    (c) The General Counsel or other delegated official, upon 
notification of receipt of the request, will have 30 days in which to 
present a written report of any experiences with the suspended or 
disqualified person subsequent to that person's suspension or 
disqualification. The Appeals Council will make available to the 
suspended or disqualified person a copy of the report.
    (d) * * *
    (3) If a person was disqualified because the person had been

[[Page 80247]]

disqualified from participating in or appearing before a Federal 
program or Federal agency, the Appeals Council will grant the request 
for reinstatement only if the criterion in paragraph (d)(1) of this 
section is met and the disqualified person shows that the person is now 
qualified to participate in or appear before that Federal program or 
Federal agency.
* * * * *
    (e) The Appeals Council will mail a notice of its decision on the 
request for reinstatement to the suspended or disqualified person. It 
will also mail a copy to the General Counsel or other delegated 
official.
* * * * *

PART 416--SUPPLEMENTAL SECURITY INCOME FOR THE AGED, BLIND, AND 
DISABLED

Subpart N--[Amended]

0
13. The authority citation for subpart N of part 416 continues to read 
as follows:

    Authority: Secs. 702(a)(5), 1631, and 1633 of the Social 
Security Act (42 U.S.C. 902(a)(5), 1383, and 1383b); sec. 202, Pub. 
L. 108-203, 118 Stat. 509 (42 U.S.C. 902 note).


0
14. Amend Sec.  416.1403 by revising paragraph (a)(7) to read as 
follows:


Sec.  416.1403  Administrative actions that are not initial 
determinations.

    (a) * * *
    (7) Refusing to recognize, disqualifying, or suspending a person 
from acting as your representative in a proceeding before us (see 
Sec. Sec.  416.1505 and 416.1545);
* * * * *

Subpart O--[Amended]

0
15. The authority citation for subpart O of part 416 continues to read 
as follows:

    Authority:  Secs. 702(a)(5), 1127 and 1631(d) of the Social 
Security Act (42 U.S.C. 902(a)(5), 1320a-6 and 1383(d)).


0
16. Amend Sec.  416.1503 by adding definitions for ``Federal agency'', 
``Federal program'', and ``representational services'' in alphabetical 
order to read as follows:


Sec.  416.1503  Definitions.

* * * * *
    Federal agency refers to any authority of the Executive branch of 
the Government of the United States.
    Federal program refers to any program established by an Act of 
Congress or administered in whole or in part by a Federal agency.
* * * * *
    Representational services means services performed for a claimant 
in connection with any claim the claimant has before us, any asserted 
right the claimant may have for an initial or reconsidered 
determination, and any decision or action by an administrative law 
judge or the Appeals Council.
* * * * *
0
17. Amend Sec.  416.1505 by removing the heading for paragraphs (a) and 
(b), revising paragraph (b) introductory text, and adding paragraph (c) 
to read as follows:


Sec.  416.1505  Who may be your representative.

* * * * *
    (b) You may appoint any person who is not an attorney to be your 
representative in dealings with us if the person--
* * * * *
    (c) We may refuse to recognize the person you choose to represent 
you if the person does not meet the requirements in this section. We 
will notify you and the person you attempted to appoint as your 
representative if we do not recognize the person as a representative.

0
18. Remove and reserve Sec.  416.1535 to read as follows:


Sec.  416.1535  [Reserved].


0
19. Amend Sec.  416.1540 by revising paragraphs (a)(1), (a)(2), (b) 
introductory text, (c) introductory text, (c)(6), and (c)(7)(iii), and 
adding paragraphs (c)(8) through (c)(13), to read as follows:


Sec.  416.1540  Rules of conduct and standards of responsibility for 
representatives.

    (a) * * * (1) All attorneys or other persons acting on behalf of a 
party seeking a statutory right or benefit must, in their dealings with 
us, faithfully execute their duties as agents and fiduciaries of a 
party. A representative must provide competent assistance to the 
claimant and recognize our authority to lawfully administer the 
process. The following provisions set forth certain affirmative duties 
and prohibited actions that will govern the relationship between the 
representative and us, including matters involving our administrative 
procedures and fee collections.
    (2) All representatives must be forthright in their dealings with 
us and with the claimant and must comport themselves with due regard 
for the nonadversarial nature of the proceedings by complying with our 
rules and standards, which are intended to ensure orderly and fair 
presentation of evidence and argument.
    (b) Affirmative duties. A representative must, in conformity with 
the regulations setting forth our existing duties and responsibilities 
and those of claimants (see Sec.  416.912 in disability and blindness 
claims):
* * * * *
    (c) Prohibited actions. A representative must not:
* * * * *
    (6) Attempt to influence, directly or indirectly, the outcome of a 
decision, determination, or other administrative action by offering or 
granting a loan, gift, entertainment, or anything of value to a 
presiding official, agency employee, or witness who is or may 
reasonably be expected to be involved in the administrative 
decisionmaking process, except as reimbursement for legitimately 
incurred expenses or lawful compensation for the services of an expert 
witness retained on a non-contingency basis to provide evidence;
    (7) * * *
    (iii) Threatening or intimidating language, gestures, or actions 
directed at a presiding official, witness, or agency employee that 
result in a disruption of the orderly presentation and reception of 
evidence;
    (8) Violate any section of the Act for which a criminal or civil 
monetary penalty is prescribed;
    (9) Refuse to comply with any of our rules or regulations;
    (10) Suggest, assist, or direct another person to violate our rules 
or regulations;
    (11) Advise any claimant or beneficiary not to comply with any of 
our rules and regulations;
    (12) Knowingly assist a person whom we suspended or disqualified to 
provide representational services in a proceeding under title XVI of 
the Act, or to exercise the authority of a representative described in 
Sec.  416.1510; or
    (13) Fail to comply with our sanction(s) decision.


0
20. Amend Sec.  416.1550 by revising paragraphs (a) and (d) to read as 
follows:


Sec.  416.1550  Notice of charges against a representative.

    (a) The General Counsel or other delegated official will prepare a 
notice containing a statement of charges that constitutes the basis for 
the proceeding against the representative.
* * * * *
    (d) The General Counsel or other delegated official may extend the 
30-day period for good cause in accordance with Sec.  416.1411.
* * * * *

[[Page 80248]]


0
21. Revise Sec.  416.1555 to read as follows:


Sec.  416.1555  Withdrawing charges against a representative.

    The General Counsel or other delegated official may withdraw 
charges against a representative. We will withdraw charges if the 
representative files an answer, or we obtain evidence, that satisfies 
us that we should not suspend or disqualify the representative from 
acting as a representative. When we consider withdrawing charges 
brought under Sec.  416.1545(d) or (e) based on the representative's 
assertion that, before or after our filing of charges, the 
representative has been reinstated to practice by the court, bar, or 
Federal program or Federal agency that suspended, disbarred, or 
disqualified the representative, the General Counsel or other delegated 
official will determine whether such reinstatement occurred, whether it 
remains in effect, and whether he or she is reasonably satisfied that 
the representative will in the future act in accordance with the 
provisions of section 206(a) of the Act and our rules and regulations. 
If the representative proves that reinstatement occurred and remains in 
effect and the General Counsel or other delegated official is so 
satisfied, the General Counsel or other delegated official will 
withdraw those charges. The action of the General Counsel or other 
delegated official regarding withdrawal of charges is solely that of 
the General Counsel or other delegated official and is not reviewable, 
or subject to consideration in decisions made under Sec. Sec.  416.1570 
and 416.1590. If we withdraw the charges, we will notify the 
representative by mail at the representative's last known address.


0
22. Amend Sec.  416.1565 by revising paragraphs (a) and (b)(1), the 
second sentence of paragraph (e), and paragraph (l) to read as follows:


Sec.  416.1565  Hearing on charges.

    (a) Holding the hearing. If the General Counsel or other delegated 
official does not take action to withdraw the charges within 15 days 
after the date on which the representative filed an answer, we will 
hold a hearing and make a decision on the charges.
    (b) Hearing officer. (1) The Deputy Commissioner for Disability 
Adjudication and Review or other delegated official will assign an 
administrative law judge, designated to act as a hearing officer, to 
hold a hearing on the charges.
* * * * *
    (e) Parties. * * * The General Counsel or other delegated official 
will also be a party to the hearing.
* * * * *
    (l) Representation. The representative, as the person charged, may 
appear in person and may be represented by an attorney or other 
representative. The General Counsel or other delegated official will be 
represented by one or more attorneys from the Office of the General 
Counsel.
* * * * *

0
23. Amend Sec.  416.1570 by revising the first sentence of paragraph 
(a)(1), paragraphs (a)(2), (a)(3) introductory text, and the second 
sentence of (a)(3)(ii) to read as follows:


Sec.  416.1570  Decision by hearing officer.

    (a) General. (1) After the close of the hearing, the hearing 
officer will issue a decision or certify the case to the Appeals 
Council. * * *
    (2) In deciding whether a person has been, by reason of misconduct, 
disbarred or suspended by a court or bar, or disqualified from 
participating in or appearing before any Federal program or Federal 
agency, the hearing officer will consider the reasons for the 
disbarment, suspension, or disqualification action. If the action was 
taken for solely administrative reasons (e.g., failure to pay dues or 
to complete continuing legal education requirements), that will not 
disqualify the person from acting as a representative before us. 
However, this exception to disqualification does not apply if the 
administrative action was taken in lieu of disciplinary proceedings 
(e.g., acceptance of a voluntary resignation pending disciplinary 
action). Although the hearing officer will consider whether the 
disbarment, suspension, or disqualification action is based on 
misconduct when deciding whether a person should be disqualified from 
acting as a representative before us, the hearing officer will not re-
examine or revise the factual or legal conclusions that led to the 
disbarment, suspension, or disqualification. For purposes of 
determining whether a person has been, by reason of misconduct, 
disqualified from participating in or appearing before any Federal 
program or Federal agency, disqualified refers to any action that 
prohibits a person from participating in or appearing before any 
Federal program or Federal agency, regardless of how long the 
prohibition lasts or the specific terminology used.
    (3) If the hearing officer finds that the charges against the 
representative have been sustained, he or she will either--
* * * * *
    (ii) * * * Disqualification is the sole sanction available if the 
charges have been sustained because the representative has been 
disbarred or suspended from any court or bar to which the 
representative was previously admitted to practice or disqualified from 
participating in or appearing before any Federal program or Federal 
agency, or because the representative has collected or received, and 
retains, a fee for representational services in excess of the amount 
authorized.
* * * * *

0
24. Amend Sec.  416.1599 by revising paragraphs (b), (c), (d)(3), and 
(e) to read as follows:


Sec.  416.1599  Reinstatement after suspension or disqualification--
period of suspension not expired.

* * * * *
    (b) The suspended or disqualified person must submit any evidence 
the person wishes to have considered along with the request to be 
allowed to serve as a representative again.
    (c) The General Counsel or other delegated official, upon 
notification of receipt of the request, will have 30 days in which to 
present a written report of any experiences with the suspended or 
disqualified person subsequent to that person's suspension or 
disqualification. The Appeals Council will make available to the 
suspended or disqualified person a copy of the report.
    (d) * * *
    (3) If a person was disqualified because the person had been 
disqualified from participating in or appearing before a Federal 
program or Federal agency, the Appeals Council will grant the request 
for reinstatement only if the criterion in paragraph (d)(1) of this 
section is met and the disqualified person shows that the person is now 
qualified to participate in or appear before that Federal program or 
Federal agency.
* * * * *
    (e) The Appeals Council will mail a notice of its decision on the 
request for reinstatement to the suspended or disqualified person. It 
will also mail a copy to the General Counsel or other delegated 
official.
* * * * *
[FR Doc. 2011-32923 Filed 12-22-11; 8:45 am]
BILLING CODE 4191-02-P