[Federal Register Volume 79, Number 34 (Thursday, February 20, 2014)]
[Proposed Rules]
[Pages 9647-9649]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-03266]
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FEDERAL RESERVE SYSTEM
12 CFR Part 230
[Docket No. R-1482]
RIN 7100 AE12
Truth in Savings (Regulation DD)
AGENCY: Board of Governors of the Federal Reserve System.
ACTION: Notice of proposed rulemaking; request for public comment.
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SUMMARY: The Board of Governors of the Federal Reserve System (Board)
is proposing to repeal its Regulation DD, 12 CFR part 230, which was
issued to implement the Truth in Saving Act (TISA). Title X of the
Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank
Act) transferred rulemaking authority for a number of consumer
financial protection laws, including TISA, from the Board to the Bureau
of Consumer Financial Protection (Bureau). In December 2011, the Bureau
published an interim final rule establishing its own Regulation DD to
implement TISA (Bureau Interim Final Rule).\1\ The Bureau Interim Final
Rule substantially duplicates the Board's Regulation DD. Credit unions
are not subject to either the Board's or Bureau's Regulation DD, and
are covered instead by a substantially identical regulation issued by
the National Credit Union Administration (NCUA) pursuant to 12 U.S.C.
4311.
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\1\ 12 CFR part 1030. See 76 FR 79276 (Dec. 21, 2011).
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Under section 1029 of the Dodd-Frank Act, the Board retains
authority to issue rules for certain motor vehicle dealers that offer
consumer financial services and are not subject to the Bureau's
regulatory authority. The Board is not aware of any entities that are
motor vehicle dealers engaging in activities subject to TISA that would
be subject to the Board's authority under section 1029 of the Dodd-
Frank Act. Accordingly, the Board is proposing to repeal its Regulation
DD.
DATES: Comments must be received on or before April 21, 2014.
ADDRESSES: You may submit comments, identified by Docket No. R-1482, by
any of the following methods:
Agency Web site: http://www.federalreserve.gov. Follow the
instructions for submitting comments at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Email: [email protected]. Include the
docket number in the subject line of the message.
FAX: (202) 452-3819 or (202) 452-3102.
Mail: Robert deV. Frierson, Secretary, Board of Governors
of the Federal Reserve System, 20th Street and Constitution Avenue NW.,
Washington, DC 20551.
All public comments are available from the Board's Web site at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as submitted,
unless modified for technical reasons. Accordingly, your comments will
not be edited to remove any identifying or contact information. Public
comments may also be viewed electronically or in paper form in Room MP-
500 of the Board's Martin Building (20th and C Streets NW.) between
9:00 a.m. and 5:00 p.m. on weekdays.
FOR FURTHER INFORMATION CONTACT: Vivian W. Wong, Counsel, Division of
Consumer and Community Affairs, at (202) 452-3667, Board of Governors
of the Federal Reserve System, 20th and C Streets NW., Washington, DC
20551. For users of Telecommunications Device for the Deaf (TDD) only,
contact (202) 263-4869.
SUPPLEMENTARY INFORMATION:
I. Background
The Truth in Savings Act (TISA), 12 U.S.C. 4301 et seq.,
historically has been implemented by the Board's Regulation DD,
published at 12 CFR part 230. The
[[Page 9648]]
purpose of the act and regulation is to assist consumers in comparing
deposit accounts offered by depository institutions, principally
through the disclosure of fees, the annual percentage yield, the
interest rate, and other account terms. An official staff commentary
interprets the requirements of the Board's Regulation DD (12 CFR part
230 (Supp. I)). Credit unions are governed by a substantially similar
regulation issued by the NCUA at 12 CFR part 707.
Title X of the Dodd-Frank Act transferred rulemaking authority for
a number of consumer financial protection laws from the Board to the
Bureau, effective July 21, 2011. In connection with the transfer of the
Board's rulemaking authority for TISA, the Bureau published an interim
final rule to establish its own Regulation DD, 12 CFR part 1030, to
implement TISA (Bureau Interim Final Rule).\2\ The Bureau Interim Final
Rule substantially duplicated the Board's Regulation DD and made only
certain non-substantive, technical, formatting, and stylistic changes.
The Bureau Interim Final Rule did not impose any new substantive
obligations on regulated entities.
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\2\ 76 FR 79276 (Dec. 21, 2011). Section 1100B of the Dodd-Frank
Act did not grant the Bureau TISA rulemaking authority over credit
unions or repeal the NCUA's TISA rulemaking authority over credit
unions under 12 U.S.C. 4311.
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Under section 1029(a) of the Dodd-Frank Act, the Bureau may not
exercise any rulemaking, supervisory, enforcement or any other
authority over a motor vehicle dealer that is predominantly engaged in
the sale and servicing of motor vehicles, the leasing and servicing of
motor vehicles, or both, subject to certain exceptions.\3\ Section
1029(c) of the Dodd-Frank Act further provides that nothing in the
Dodd-Frank Act should be construed to modify, limit, or supersede the
authority of the Board with respect to a motor vehicle dealer described
in section 1029(a) of the Dodd-Frank Act.\4\ Accordingly, to the extent
that a motor vehicle dealer described in section 1029(a) of the Dodd-
Frank Act was subject to one of the Board's consumer financial service
regulations, the Board's regulation would continue to apply.
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\3\ Section 1029(a) of the Dodd-Frank Act states: ``Except as
permitted in subsection (b), the Bureau may not exercise any
rulemaking, supervisory, enforcement, or any other authority . . .
over a motor vehicle dealer that is predominantly engaged in the
sale and servicing of motor vehicles, the leasing and servicing of
motor vehicles, or both.'' 12 U.S.C. 5519(a). Section 1029(b) of the
Dodd-Frank Act states: ``Subsection (a) shall not apply to any
person, to the extent such person (1) provides consumers with any
services related to residential or commercial mortgages or self-
financing transaction involving real property; (2) operates a line
of business (A) that involves the extension of retail credit or
retail leases involving motor vehicles; and (B) in which (i) the
extension of retail credit or retail leases are provided directly to
consumers and (ii) the contract governing such extension of retail
credit or retail leases is not routinely assigned to an unaffiliated
third party finance or leasing source; or (3) offers or provides a
consumer financial product or service not involving or related to
the sale, financing, leasing, rental, repair, refurbishment,
maintenance, or other servicing of motor vehicles, motor vehicle
parts, or any related or ancillary product or service.'' 12 U.S.C.
5519(b).
\4\ 12 U.S.C. 5519(c).
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II. Statutory Authority
As noted above, Title X of the Dodd-Frank Act transferred
rulemaking authority for TISA from the Board to the Bureau, effective
July 21, 2011. Pursuant to Section 1029 of the Dodd-Frank Act, however,
the Board retains rulemaking authority for consumer financial
protection laws to the extent that such laws could cover motor vehicle
dealers identified in Section 1029(a) of the Dodd-Frank Act.
III. Discussion
TISA and the Board's Regulation DD apply only to depository
institutions. See 12 U.S.C. 4301; 12 CFR 230.1(c). For this purpose,
the term ``depository institution'' includes ``an institution defined
in Section 19(b)(1)(A)(i) through (vi) of the Federal Reserve Act (12
U.S.C. 461), except credit unions defined in Section 19(b)(1)(A)(iv).''
12 U.S.C. 4313(6); 12 CFR 230.2(j). Depository institutions are
generally subject to restrictions on the types of activities in which
they may engage as principal. See e.g., 12 U.S.C. 24 (Seventh) and 12
U.S.C. 1831a. These activities are restricted to those that are
necessary to carry on the business of banking and other limited
financial activities. Based on these restrictions, the Board believes
that motor vehicle dealers, as defined in Section 1029(a) of the Dodd-
Frank Act, that are predominantly engaged in the sale and servicing of
motor vehicles, the leasing and servicing of motor vehicles, or both,
could not also be depository institutions subject to TISA.
Consequently, the Board is publishing a proposed rule for public
comment to repeal the Board's Regulation DD, 12 CFR part 230. The
Board, requests comment, however, on whether any motor vehicle dealers
identified in Section 1029(a) of the Dodd-Frank Act are or could become
depository institutions for purposes of TISA.
IV. Initial Regulatory Flexibility Analysis
The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) (RFA)
generally requires an agency to perform an assessment of the impact a
rule is expected to have on small entities. Based on its analysis, and
for the reasons stated below, the Board believes that this proposed
rule will not have a significant economic impact on a substantial
number of small entities. A final regulatory flexibility analysis will
be conducted after consideration of comments received during the public
comment period.
1. Statement of the need for, and objectives of, the proposed rule.
Title X of the Dodd-Frank Act transferred rulemaking authority for a
number of consumer financial protection laws from the Board to the
Bureau, effective July 21, 2011, including TISA. The Bureau issued the
Bureau Interim Final Rule to implement TISA in connection with the
transfer of TISA rulemaking authority to the Bureau. Pursuant to
Section 1029 of the Dodd-Frank Act, however, the Board retains
rulemaking authority for consumer financial protection laws to the
extent that such laws could cover motor vehicle dealers identified in
Section 1029(a) of the Dodd-Frank Act. The Board does not believe that
any motor vehicle dealers identified in Section 1029(a) of the Dodd-
Frank Act are or could become depository institutions subject to TISA.
Consequently, the Board is proposing to repeal the Board's Regulation
DD, 12 CFR part 230.
2. Small entities affected by the proposed rule. The Board does not
believe that any motor vehicle dealers identified in Section 1029(a) of
the Dodd-Frank Act are or could become depository institutions subject
to TISA. Therefore, the Board believes the proposed rule would not
affect any entity, including any small entity.
3. Recordkeeping, reporting, and compliance requirements. The
proposed rule would repeal the Board's Regulation DD, 12 CFR part 230,
and would therefore not impose any recordkeeping, reporting, or
compliance requirements on any entities.
4. Other federal rules. The Board has not identified any federal
rules that duplicate, overlap, or conflict with the proposed repeal of
the Board's Regulation DD, 12 CFR part 230.
5. Significant alternatives to the proposed revisions. The Board is
not aware of any significant alternatives that would further minimize
any significant economic impact of the proposed rule on small entities,
but solicits comment on this approach.
V. Paperwork Reduction Act
In accordance with the Paperwork Reduction Act (PRA) of 1995 (44
U.S.C.
[[Page 9649]]
3506; 5 CFR part 1320 Appendix A.1), the Board reviewed the rule under
the authority delegated to the Federal Reserve by the Office of
Management and Budget (OMB). The proposed rule contains no collections
of information under the PRA. See 44 U.S.C. 3502(3). Accordingly, there
is no paperwork burden associated with the proposed rule.
List of Subjects in 12 CFR Part 230
Advertising, Banks, Banking, Consumer protection, Reporting and
recordkeeping requirements, Truth in savings.
Authority and Issuance
PART 230--[REMOVED AND RESERVED]
For the reasons set forth in the preamble, under the authority of
12 U.S.C. 5581, the Board proposes to remove and reserve Regulation DD,
12 CFR part 230.
By order of the Board of Governors of the Federal Reserve
System, February 10, 2014.
Robert deV. Frierson,
Secretary of the Board.
[FR Doc. 2014-03266 Filed 2-19-14; 8:45 am]
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