[Federal Register Volume 81, Number 233 (Monday, December 5, 2016)]
[Notices]
[Pages 87561-87562]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-29060]


=======================================================================
-----------------------------------------------------------------------

FEDERAL TRADE COMMISSION


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

AGENCY: Federal Trade Commission (``FTC'').

ACTION: Notice and request for comment.

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

SUMMARY: In compliance with the Paperwork Reduction Act (PRA) of 1995, 
the FTC is seeking public comments on its request to OMB for a three-
year extension of the current PRA clearance for the FTC's portion of 
the information collection requirements contained in the Consumer 
Financial Protection Bureau's Regulation N (the Mortgage Acts and 
Practices--Advertising Rule). The FTC shares enforcement of Regulation 
N with the Consumer Financial Protection Bureau (``CFPB''). This 
clearance expires on December 31, 2016.

DATES: Comments must be received by January 4, 2017.

ADDRESSES: Interested parties may file a comment online or on paper, by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write ``Regulation N: FTC File 
No. P134811; K05'' on your comment, and file your comment online at 
https://ftcpublic.commentworks.com/ftc/regulationnpra2 by following the 
instructions on the Web-based form. If you prefer to file your comment 
on paper, mail or deliver your comment to the following address: 
Federal Trade Commission, Office of the Secretary, 600 Pennsylvania 
Avenue NW., Suite CC-5610 (Annex J), Washington, DC 20580, or deliver 
your comment to the following address: Federal Trade Commission, Office 
of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, 
Suite 5610 (Annex J), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: Requests for additional information or 
copies of the proposed information requirements should be addressed to 
Carole L. Reynolds, Attorney, Division of Financial Practices, Bureau 
of Consumer Protection, Federal Trade Commission, 600 Pennsylvania 
Avenue NW., Washington, DC 20580, (202) 326-3230.

SUPPLEMENTARY INFORMATION:
    Title: Mortgage Acts and Practices--Advertising (Regulation N), 12 
CFR 1014.
    OMB Control Number: 3084-0156.
    Type of Review: Extension of a currently approved collection.
    Abstract: The FTC's Mortgage Acts and Practices--Advertising Rule, 
16 CFR 321, was issued by the FTC on July 19, 2011, at www.ftc.gov, 
published in the Federal Register, 76 FR 43845, and became effective on 
August 19, 2011.
    The Dodd-Frank Wall Street Reform and Consumer Protection Act of 
2010 (Dodd-Frank Act) \1\ substantially changed the federal legal 
framework for financial services providers. Among the changes, the 
Dodd-Frank Act transferred to the Consumer Financial Protection Bureau 
(CFPB) the Commission's rulemaking authority under section 626 of the 
2009 Omnibus Appropriations Act on July 21, 2011. As a result, the CFPB 
republished the Mortgage Acts and Practices--Advertising Rule, at 12 
CFR 1014, which became effective December 30, 2011. 76 FR 78130. 
Thereafter, the Commission rescinded its Rule on, and effective, April 
13, 2012. 77 FR 22200. Under the Dodd-Frank Act, the FTC retains its 
authority to bring law enforcement actions to enforce Regulation N.\2\ 
The FTC and the CFPB share enforcement authority for Regulation N and 
thus the two agencies share burden estimates \3\ for Regulation N.
---------------------------------------------------------------------------

    \1\ Public Law 111-203, 124 Stat. 1376 (2010).
    \2\ The Commission also retained its authority to enforce the 
Mortgage Acts and Practices--Advertising Rule from the Rule's 
issuance in July 2011 until the CFPB's republished rule, Regulation 
N, became effective on December 30, 2011.
    \3\ The CFPB clearance for their information collections 
associated with Regulation N was approved by the OMB on September 
30, 2015 (OMB Control Number 3170-0009) through September 30, 2018.
---------------------------------------------------------------------------

    Regulation N's recordkeeping requirements constitute a ``collection 
of information'' \4\ for purposes of the PRA.\5\ The Rule does not 
impose a disclosure requirement.
---------------------------------------------------------------------------

    \4\ Section 1014.5 of the Rule sets forth the recordkeeping 
requirements.
    \5\ See 44 U.S.C. 3502(3)(A).
---------------------------------------------------------------------------

    Regulation N requires covered persons to retain: (1) Copies of 
materially different commercial communications and related materials, 
regarding any term of any mortgage credit product, that the person made 
or disseminated during the relevant time period; (2) documents 
describing or evidencing all mortgage credit products available to 
consumers during the relevant time period; and (3) documents describing 
or evidencing all additional products or services (such as credit 
insurance or credit disability insurance) that are or may be offered or 
provided with the mortgage credit products available to consumers 
during the relevant time period. A failure to keep such records would 
be an independent violation of the Rule.
    Commission staff believes these recordkeeping requirements pertain 
to records that are usual and customary and kept in the ordinary course 
of business for many covered persons, such as mortgage brokers, 
lenders, and servicers; real estate brokers and agents; home builders, 
and advertising agencies.\6\ As to these persons, the retention of 
these documents does not constitute a ``collection of information,'' as 
defined by OMB's regulations that implement the PRA.\7\ Certain other 
covered persons such as lead generators and rate aggregators may not 
currently maintain these records in the ordinary course of business.\8\ 
Thus, the

[[Page 87562]]

recordkeeping requirements for those persons would constitute a 
``collection of information.''
---------------------------------------------------------------------------

    \6\ Some covered persons, particularly mortgage brokers and 
lenders, are subject to state recordkeeping requirements for 
mortgage advertisements. See, e.g., Fla. Stat. 494.00165 (2016); 
Ind. Code Ann. 23-2-5-18 (2016); Kan. Stat. Ann. 9-2208 (2015); 
Minn. Stat. 58.14 (2015); Wash. Rev. Code 19.146.060 (2015). Many 
mortgage brokers, lenders (including finance companies), and 
servicers are subject to state recordkeeping requirements for 
mortgage transactions and related documents, and these may include 
descriptions of mortgage credit products. See, e.g., Mich. Comp. 
Laws Serv. 445.1671 (2016); N.Y. Banking Law 597 (Consol. 2015); 
Tenn. Code Ann. 45-13-206 (2015). Lenders and mortgagees approved by 
the Federal Housing Administration must retain copies of all print 
and electronic advertisements and promotional materials for a period 
of two years from the date the materials are circulated or used to 
advertise. See 24 CFR 202. Various other entities, such as real 
estate brokers and agents, home builders, and advertising agencies 
can be indirectly covered by state recordkeeping requirements for 
mortgage advertisements and/or retain ads to demonstrate compliance 
with state law. See, e.g., 76 Del. Laws, c. 421, Sec.  1.
    \7\ See 44 U.S.C. 3502(3)(A); 5 CFR 1320.3(b)(2).
    \8\ See, e.g., United States v. Intermundo Media, LLC, dba Delta 
Prime Refinance, No. 1:14-cv-2529 (D. Colo. filed Sept. 12, 2014) 
(D. Colo. Oct.7, 2014) (stipulated order for permanent injunction 
and civil penalty judgment), available at https://www.ftc.gov/system/files/documents/cases/140912deltaprimestiporder.pdf. The 
complaint charged this lead generator with numerous violations of 
Regulation N, including recordkeeping, and of other federal mortgage 
advertising mandates.
---------------------------------------------------------------------------

    The information retained under the Rule's recordkeeping 
requirements is used by the Commission to substantiate compliance with 
the Rule and may also provide a basis for the Commission to bring an 
enforcement action. Without the required records, it would be difficult 
either to ensure that entities are complying with the Rule's 
requirements or to bring enforcement actions based on violations of the 
Rule.
    On August 31, 2016, the Commission sought comment on the Rule's 
information collection requirements.\9\ No germane comments were 
received.\10\
---------------------------------------------------------------------------

    \9\ See 81 FR 60001.
    \10\ The Commission received five non-germane comments, of which 
one was a duplicate.
---------------------------------------------------------------------------

    As required by OMB regulations, 5 CFR part 1320, the FTC is 
providing this second opportunity for public comment.
    Likely Respondents: Lead generators and rate aggregators.
    Estimated Annual Hours Burden: 1,500 hours.
     Derived from 1,000 likely respondents \11\ x approximately 
3 hours each respondent per year to do these tasks = 3,000 hours.
---------------------------------------------------------------------------

    \11\ No general source provides precise numbers of the various 
categories of covered persons. Commission staff, therefore, has used 
the following sources and inputs to arrive at this estimated total: 
1,000 lead generators and rate aggregators, based on staff's 
administrative experience. The Commission does not know what 
percentage of these persons are, in fact, engaged in covered conduct 
under the Rule, i.e., providing commercial communications about 
mortgage credit product terms. For purposes of these estimates, the 
Commission has assumed all of them are covered by the recordkeeping 
provisions and are not retaining these records in the ordinary 
course of business.
---------------------------------------------------------------------------

     Since the FTC shares enforcement authority with the CFPB 
for Regulation N, the FTC's allotted PRA burden is 1,500 annual 
hours.\12\
---------------------------------------------------------------------------

    \12\ This estimate reflects a decrease in burden compared to 
prior FTC estimates, because many entities can be indirectly covered 
by state recordkeeping requirements for mortgage advertisements and/
or retain ads to demonstrate compliance with state law, as discussed 
above. See supra note 6. The FTC notes that the CFPB's recent 
information collection filing with OMB for Regulation N also 
reflects the view that, in large part, most entities either retain 
records in the ordinary course of business or to demonstrate 
compliance with other laws. See generally Bureau of Consumer 
Financial Protection, Agency Information Collection Activities: 
Submission for OMB Review; Comment Review, 80 FR 45645 (July 31, 
2015), available at https://www.gpo.gov/fdsys/pkg/FR-2015-07-31/pdf/2015-18809.pdf.
---------------------------------------------------------------------------

    Estimated Annual Cost Burden: $21,570, which is derived from 1,500 
hours x $14.38 per hour.\13\
---------------------------------------------------------------------------

    \13\ This estimate is based on mean hourly wages for office 
support file clerks provided by the Bureau of Labor Statistics. See 
U.S. Bureau of Labor Statistics, Occupational Employment and Wages--
May 2015, table 1 (``National employment and wage data from the 
Occupational Employment Statistics survey by occupation''), released 
Mar. 30, 2016, available at http://www.bls.gov/news.release/pdf/ocwage.pdf.
---------------------------------------------------------------------------

Request for Comment

    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before January 4, 2017. 
Write ``Regulation N: FTC File No. P134811; K05'' on your comment. Your 
comment--including your name and your state--will be placed on the 
public record of this proceeding, including, to the extent practicable, 
on the public Commission Web site, at http://www.ftc.gov/os/publiccomments.shtm. As a matter of discretion, the Commission tries to 
remove individuals' home contact information from comments before 
placing them on the Commission Web site.
    Because your comment will be made public, you are solely 
responsible for making sure that your comment does not include any 
sensitive personal information, such as anyone'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. You are also 
solely responsible for making sure that your comment does not include 
any sensitive health information, like medical records or other 
individually identifiable health information. In addition, do not 
include any ``[t]rade secret or any commercial or financial information 
which is . . . privileged or confidential,'' as discussed in Section 
6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 
4.10(a)(2). In particular, do not include competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    If you want the Commission to give your comment confidential 
treatment, you must file it in paper form, with a request for 
confidential treatment, and you are required to follow the procedure 
explained in FTC Rule 4.9(c), 16 CFR 4.9(c). Your comment will be kept 
confidential only if the FTC General Counsel grants your request in 
accordance with the law and the public interest.
    Postal mail addressed to the Commission is subject to delay due to 
heightened security screening. As a result, we encourage you to submit 
your comment online, or to send it to the Commission by courier or 
overnight service. To make sure that the Commission considers your 
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/regulationnpra2, by following the instructions on the web-based 
form. If this Notice appears at http://www.regulations.gov, you also 
may file a comment through that Web site.
    If you file your comment on paper, write ``Regulation N: FTC File 
No. P134811; K05'' on your comment and on the envelope, and mail or 
deliver it to the following address: Federal Trade Commission, Office 
of the Secretary, Room H-113 (Annex J), 600 Pennsylvania Avenue NW., 
Washington, DC 20580, or deliver your comment to the following address: 
Federal Trade Commission, Office of the Secretary, Constitution Center, 
400 7th Street SW., 5th Floor, Suite 5610 (Annex J), Washington, DC 
20024. If possible, submit your paper comment to the Commission by 
courier or overnight service.
    Visit the Commission Web site at http://www.ftc.gov to read this 
Notice. 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 on or before January 4, 
2017. You can find more information, including routine uses permitted 
by the Privacy Act, in the Commission's privacy policy, at http://www.ftc.gov/ftc/privacy.shtm.
    Comments on the information collection requirements subject to 
review under the PRA should also be submitted to OMB. If sent by U.S. 
mail, address comments to: Office of Information and Regulatory 
Affairs, Office of Management and Budget, Attention: Desk Officer for 
the Federal Trade Commission, New Executive Office Building, Docket 
Library, Room 10102, 725 17th Street NW., Washington, DC 20503. 
Comments sent to OMB by U.S. postal mail, however, are subject to 
delays due to heightened security precautions. Thus, comments instead 
should be sent by facsimile to (202) 395-5167.

David C. Shonka,
Acting General Counsel.
[FR Doc. 2016-29060 Filed 12-2-16; 8:45 am]
BILLING CODE 6750-01-P