[Federal Register Volume 78, Number 128 (Wednesday, July 3, 2013)]
[Rules and Regulations]
[Pages 39957-39959]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-15905]



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 Rules and Regulations
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  Federal Register / Vol. 78, No. 128 / Wednesday, July 3, 2013 / Rules 
and Regulations  

[[Page 39957]]



FEDERAL HOUSING FINANCE BOARD

12 CFR Part 911

FEDERAL HOUSING FINANCE AGENCY

12 CFR Part 1214

RIN 2590-AA06


Availability of Non-Public Information

AGENCY: Federal Housing Finance Board; Federal Housing Finance Agency.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Federal Housing Finance Agency (FHFA or Agency) is issuing 
a final rule governing the disclosure of FHFA non-public information. 
The final rule replaces rules issued by FHFA's predecessor agencies the 
Federal Housing Finance Board (Finance Board) and the Office of Federal 
Housing Enterprise Oversight (OFHEO). The final rule prohibits the 
unauthorized disclosure of FHFA non-public information, replaces the 
Finance Board's rule on the Availability of Unpublished Information, 
and parallels those portions of OFHEO's former rule on non-public 
information that were not replaced by FHFA's Freedom of Information Act 
regulation.

DATES: The effective date of this regulation is: August 2, 2013.

FOR FURTHER INFORMATION CONTACT: James P. Jordan, Senior Counsel, 202-
649-3075 (not a toll-free number), Federal Housing Finance Agency, 
Constitution Center, 400 Seventh Street SW., Eighth Floor, Washington, 
DC 20024. The telephone number for the Telecommunications Device for 
the Hearing Impaired is 800-877-8339.

SUPPLEMENTARY INFORMATION: 

I. Background

Establishment of FHFA

    Effective July 30, 2008, the Housing and Economic Recovery Act of 
2008 (Pub. L. 110-289, 122 Stat. 2654) (HERA), amended the Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992 (12 
U.S.C. 4501 et seq.) (Safety and Soundness Act), and the Federal Home 
Loan Bank Act (12 U.S.C. 1421-1449) to establish FHFA as an independent 
regulatory agency of the Federal Government. FHFA was established with 
all of the authorities necessary to supervise and regulate the Federal 
National Mortgage Association, the Federal Home Loan Mortgage 
Corporation, the Federal Home Loan Banks (collectively, regulated 
entities), and the Office of Finance of the Federal Home Loan Bank 
System (Office of Finance).
    HERA transferred to FHFA the employees, functions, and regulations 
of OFHEO, the Finance Board, and the Government-Sponsored Enterprise 
mission team within the U.S. Department of Housing and Urban 
Development. FHFA is responsible for ensuring that the regulated 
entities operate in a safe and sound manner, including maintaining 
adequate capital and internal controls; foster liquid, efficient, 
competitive, and resilient national housing finance markets; comply 
with the Safety and Soundness Act and their respective authorizing 
statutes, as well as all rules, regulations, guidelines, and orders 
issued under law; and carry out their missions through activities that 
are authorized by law and are consistent with the public interest. In 
addition, FHFA may prescribe regulations as determined to be 
appropriate regarding the conduct of conservatorships or receiverships.
    The FHFA published a proposed regulation on the Availability of 
Non-Public Information for public comment in the Federal Register, 78 
FR 6042 (January 29, 2013). No comments were received. Accordingly, the 
proposed regulation is adopted as a final regulation with only minor 
editorial changes.

II. Analysis of Rule

    The Safety and Soundness Act mandates that FHFA issue regulations 
in connection with FHFA's supervision and regulation of the regulated 
entities and the Office of Finance. The final rule updates, clarifies, 
and simplifies existing regulations and eliminates redundant 
provisions. It reduces confusion about the applicability of predecessor 
agencies' rules.
    The final rule prohibits the unauthorized disclosure of FHFA non-
public information, replace the Finance Board's rule on the 
Availability of Unpublished Information at 12 CFR part 911, and 
parallel those portions of OFHEO's former rule on non-public 
information that were not replaced by FHFA's Freedom of Information Act 
regulation at 12 CFR part 1202. The final rule does not affect 12 CFR 
part 1703 Subparts E-F. As described below, FHFA is issuing a separate 
rule to replace those subparts.
    The final rule Sec. Sec.  1214.3 and 1214.4 are substantively 
analogous to the former 12 CFR 1703.6 to 1703.8 and to the existing 12 
CFR 911.3, which the final rule replaces. The final FHFA rule (12 CFR 
part 1214), the former OFHEO rule (12 CFR part 1703), and the existing 
Finance Board rule (12 CFR part 911), all generally prohibit disclosure 
of non-public agency information to parties that are not agency 
employees, and set forth the limited circumstances when disclosure is 
permitted. The Finance Board rule, 12 CFR part 911, also outlines how 
the Finance Board handled demands and requests for information in the 
context of legal proceedings. Today, FHFA also sent to be published in 
this issue of the Federal Register a final rule on ``Production of FHFA 
Records, Information, and Employee Testimony in Third-Party Legal 
Proceedings (``Touhy'') which sets forth FHFA's process for handling 
those demands and requests.

Use of the Term ``Confidential''

    The final rule would define ``confidential supervisory 
information,'' to be included as a subset of ``non-public 
information.'' The inclusion of the term ``confidential'' within the 
definition of ``confidential supervisory information'' is not intended 
to invoke the meaning of ``confidential,'' as that term is used in 
Executive Order 13526, Classified National Security Information, 
December 29, 2009. Confidential supervisory information is used in part 
1214 to refer to the distinct category of information defined in final 
Sec.  1214.1. FHFA used the word ``confidential'' within the label for 
this

[[Page 39958]]

category of information simply to be consistent with the manner in 
which federal banking agencies refer to similar or identical types of 
information.

Regulatory Impacts

Paperwork Reduction Act

    The final rule does not contain any information collection 
requirement that requires the approval of the Office of Management and 
Budget under the Paperwork Reduction Act (44 U.S.C. 3501 et seq.).

Regulatory Flexibility Act and Executive Order 13272--Consideration of 
Small Entities

    FHFA has considered the final rule's impact under the Regulatory 
Flexibility Act (5 U.S.C. 602 et seq.) and Executive Order 13272 of 
August 13, 2002. The final rule, is not likely to have a significant 
economic impact on a substantial number of small entities under the 
Regulatory Flexibility Act and Executive Order 13272, because it will 
not: (1) Impose record-keeping requirements on them; (2) affect their 
competitive position in relation to large entities; and (3) affect 
their cash flow, liquidity or ability to remain in the market. (5 
U.S.C. 605(b)).

List of Subjects

12 CFR Part 911

    Credit, Federal home loan banks, Reporting and recordkeeping 
requirements.

12 CFR Part 1214

    Administrative practice and procedure, Confidential commercial 
information, Disclosure, Exemptions, Government employees, Records.

    Accordingly, for the reasons set forth in the SUPPLEMENTARY 
INFORMATION, and under the authority of 12 U.S.C. 4526, FHFA hereby 
amends chapters IX and XII of title 12 of the Code of Federal 
Regulations as follows:

Chapter IX--Federal Housing Finance Board

PART 911--[REMOVED]

0
1. Remove part 911.

Chapter XII--Federal Housing Finance Agency

0
2. Add part 1214 to read as follows:

PART 1214--AVAILABILITY OF NON-PUBLIC INFORMATION

Sec.
1214.1 Definitions.
1214.2 Purpose and scope.
1214.3 General rule.
1214.4 Exceptions.

    Authority:  5 U.S.C. 301, 552; 12 U.S.C. 4501, 4513, 4522, 4526, 
4639.


Sec.  1214.1  Definitions.

    Confidential supervisory information means information prepared or 
received by FHFA that meets all of the following criteria:
    (1) The information is not a document prepared by a regulated 
entity or the Office of Finance for its own business purposes that is 
in its possession;
    (2) The information is exempt from the Freedom of Information Act, 
5 U.S.C. 552 (1966); and
    (3) The information--(i) Consists of reports of examination, 
inspection and visitation, confidential operating and condition 
reports, and any information derived from, related to, or contained in 
such reports, or
    (ii) Is gathered by FHFA in the course of any investigation, 
suspicious activity report, cease-and-desist order, civil money penalty 
enforcement order, suspension, removal or prohibition order, or other 
supervisory or enforcement orders or actions taken under the Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992, Public 
Law 102-550, 122 Stat. 2654.
    Disclosure means release or divulgence of information by any person 
to a person outside of FHFA.
    FHFA employee means strictly for the purpose of this regulation, 
any person employed by FHFA, including any current or former officer, 
intern, agent, contractor or contractor personnel, or detailee of FHFA, 
and any person employed by the FHFA Office of the Inspector General 
(FHFA-OIG), including any current or former officer, intern, agent, 
contractor or contractor personnel, or detailee of FHFA-OIG.
    Non-public information means information that FHFA has not made 
public that is created by, obtained by, or communicated to an FHFA 
employee in connection with the performance of official duties, 
regardless of who is in possession of the information. This includes 
confidential supervisory information as defined above. It does not 
include information or documents that FHFA has disclosed under the 
Freedom of Information Act (5 U.S.C. 552; 12 CFR part 1202), or Privacy 
Act of 1974 (5 U.S.C. 552a; 12 CFR part 1204). It also does not include 
specific information or documents that were previously disclosed to the 
public at large or information or documents that are customarily 
furnished to the public at large in the course of the performance of 
official FHFA duties, including but not limited to: Disclosures made by 
the Director pursuant to 24 CFR subpart F, and any FHFA successor 
rules; the annual report that FHFA submits to Congress pursuant to the 
Federal Housing Enterprises Financial Safety and Soundness Act of 1992 
(12 U.S.C. 4501 et seq.), press releases, FHFA blank forms, and 
materials published in the Federal Register.
    Person means individual or business entity.


Sec.  1214.2  Purpose and scope.

    (a) Purpose. The purpose of this part is to control the 
dissemination of non-public information, which includes confidential 
supervisory information, and maintain its controlled, sensitive, 
privileged, or proprietary nature, as appropriate.
    (b) Scope. This part imposes a broad-based prohibition against 
unauthorized disclosure of any non-public information. This part does 
not supersede the regulations at 12 CFR part 1202 (governing disclosure 
under the Freedom of Information Act); 12 CFR part 1204 (governing 
disclosure under the Privacy Act); and the sections describing 
permitted disclosures in any FHFA rules on Federal Home Loan Bank 
Information Sharing or on the FHFA Public Use Database.
    (c) These provisions also do not supersede or otherwise alter the 
rights or liabilities created by 5 U.S.C. 7211 (governing disclosures 
to Congress); 5 U.S.C. 2302(b)(8) (governing disclosures of illegality, 
waste, fraud, abuse, or public health or safety threats); or 12 U.S.C. 
3401 (governing disclosure of financial institution customer 
information).


Sec.  1214.3  General rule.

    (a) In general, Non-FHFA Employees. The Director makes available to 
each regulated entity a copy of FHFA's report of examination of that 
regulated entity. The report of examination and all other confidential 
supervisory information is the property of FHFA and is provided to the 
regulated entity for its confidential internal use only. Under no 
circumstance shall any person in possession or control of confidential 
supervisory information make public or disclose, in any manner, the 
confidential supervisory information, or any portion of the contents 
thereof, except as authorized in writing by the Director.
    (b) In general, FHFA Employees. Except as authorized in writing by 
the Director, no FHFA employee in possession or control of non-public 
information may disclose or permit the use or disclosure of such 
information in any manner or for any purpose.

[[Page 39959]]

    (c) Persons possessing confidential supervisory information. All 
confidential supervisory information, for which the Director authorizes 
disclosure, remains the property of FHFA and may not be used or 
disclosed for any purpose other than that authorized under this part 
without the prior written permission of the Director.
    (d) No Waiver. FHFA's disclosure of non-public information to any 
person does not constitute a waiver by FHFA of any privilege or FHFA's 
right to control, supervise, or impose limitations on, the subsequent 
use and disclosure of the non-public information.
    (e) Penalties, Confidential Supervisory Information. Any person 
that discloses or uses confidential supervisory information except as 
authorized under this part may be subject to the penalties provided in 
18 U.S.C. 641 and other applicable laws. In addition to those 
penalties, FHFA, regulated entity, Office of Finance, affiliate (as 
defined in 12 U.S.C. 4502(20)), or entity-affiliated party (as defined 
in 12 U.S.C. 4502(11)) employees may be subject to appropriate 
administrative, enforcement, or disciplinary proceedings.
    (f) Penalties, Non-Public Information. Any FHFA employee that 
discloses or uses non-public information except as authorized under 
this part may be subject to the penalties provided in 18 U.S.C. 641, 
other applicable laws, and appropriate administrative, enforcement, or 
disciplinary proceedings.


Sec.  1214.4  Exceptions.

    (a) FHFA Employees. Current FHFA employees may disclose or permit 
the disclosure of non-public information to another FHFA employee or 
regulated entity or the Office of Finance, when necessary and 
appropriate, for the performance of their official duties.
    (b) Regulated Entity Agents and Consultants.--(1) When necessary 
and appropriate for regulated entity or Office of Finance business 
purposes, a regulated entity, the Office of Finance, or any director, 
officer, or employee thereof may disclose confidential supervisory 
information to any person currently engaged by the regulated entity or 
the Office of Finance, as officer, director, employee, attorney, 
auditor, or independent auditor (``regulated entity agents'').
    (2) A regulated entity, the Office of Finance, or a director, 
officer, employee, or agent thereof, also may disclose confidential 
supervisory information to a consultant under this paragraph if the 
consultant is under a written contract to provide services to the 
regulated entity or the Office of Finance and the consultant has agreed 
in writing:
    (i) To abide by the prohibition on the disclosure of confidential 
supervisory information contained in this section; and
    (ii) That it will not use the confidential supervisory information 
for any purposes other than those stated in its contract to provide 
services to the regulated entity or the Office of Finance.
    (c) Law Enforcement Proceedings. Notwithstanding the general 
prohibition of disclosure of non-public information, to the minimum 
extent required by the Inspector General Act, Public Law 95-452, 92 
Stat. 1101 (1978), FHFA's Office of Inspector General is permitted 
under this section to disclose non-public FHFA information without 
Director approval.
    (d) Privilege. FHFA retains all privilege claims for non-public 
information shared under Sec.  1214.4, including, but not limited to 
attorney-client, attorney-work product, deliberative process, and 
examination privileges.

    Dated: June 27, 2013.
Edward J. DeMarco,
Acting Director, Federal Housing Finance Agency.
[FR Doc. 2013-15905 Filed 7-2-13; 8:45 am]
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