[Federal Register Volume 82, Number 187 (Thursday, September 28, 2017)]
[Rules and Regulations]
[Pages 45182-45187]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-20777]
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DEPARTMENT OF THE TREASURY
Financial Crimes Enforcement Network
31 CFR Parts 1010 and 1024
[Docket No. Fincen-2014-0001]
RIN 1506-AB25
Customer Due Diligence Requirements for Financial Institutions;
Correction
AGENCY: Financial Crimes Enforcement Network (FinCEN), Treasury.
ACTION: Correcting amendments.
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SUMMARY: FinCEN is making technical corrections to a final rule
published in the Federal Register on Wednesday, May 11, 2016. The final
rule relates to certain customer due diligence standards applicable to
covered financial institutions, defined as banks, brokers or dealers in
securities, mutual funds, and futures commission merchants and
introducing brokers in commodities. As published, the final rule
contains technical errors that could cause confusion if not corrected.
DATES: Effective Date: These corrections are effective September 28,
2017.
Applicability date: Covered financial institutions must comply with
these rules and the rules published in the Federal Register on May 11,
2016 (81 FR 29398) by May 11, 2018.
FOR FURTHER INFORMATION CONTACT: FinCEN Resource Center at 1-800-767-
2825. E-mail inquiries can be sent to [email protected].
SUPPLEMENTARY INFORMATION:
I. Background
On May 11, 2016, FinCEN published a final rule (81 FR 29398)
entitled ``Customer Due Diligence Requirements for Financial
Institutions.'' The final rule amends the Bank Secrecy Act regulations
to include a new requirement for covered financial institutions to
identify and verify the identity of beneficial owners of legal entity
customers, subject to certain exclusions and exemptions. The final rule
also amends the anti-money laundering (AML) program requirements for
all covered institutions. This document makes technical corrections to
the Certification Form located in appendix A to 31 CFR 1010.230 and
adds a paragraph to 31 CFR 1024.210(b) that was inadvertently omitted
in the final rule published in the Federal Register with an effective
date of July 11, 2016, and an applicability date of May 11, 2018.
II. Description of the Technical Corrections
A. Correction to Appendix A to Sec. 1010.230
This document makes technical corrections to Appendix A
(Certification Form) to 31 CFR 1010.230. Appendix A inadvertently
omitted the words ``, Type,'' after ``Name'' in the heading of Section
II.b.\1\ Appendix A also included the term ``foreign persons'' in lieu
of the term ``non-U.S. persons'' in several places and omitted the term
``Social Security number'' as described below. Because appendix A was
originally
[[Page 45183]]
printed in the Federal Register from camera-ready copy rather than from
typed text, the entire Appendix A, with the corrections, must be
reprinted in the Federal Register from new camera-ready copy. As
revised, appendix A (Certification Form) is identical to the original
version except for the following: In the first sentence in Part I under
the heading ``What information do I have to provide?'', the term
``foreign persons'' is changed to ``non-U.S. persons''; and in Part II:
The heading of Section II b. is changed to ``b. Name, Type, and Address
of Legal Entity for Which the Account is Being Opened:''; and in the
headings of the last column in the Tables in Section II c and Section
II d, the term ``Foreign Persons'' is changed to ``Non-U.S. Persons''
and the term ``Social Security Number'' is added after the term
``persons''; and in footnote 1, the term ``Foreign Persons'' is changed
to ``Non-U.S. Persons'' and ``a Social Security Number,'' is inserted
after the word ``provide''.
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\1\ See 81 FR 29398, 29455.
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B. Correction to Sec. 1024.210
This document also makes a technical correction in 31 CFR 1024.210
by reinserting the training element of the AML program requirements for
mutual funds, which was inadvertently omitted from the final rule.
Consistent with 31 U.S.C. 5318(h)(1)(C) and the AML program
requirements for mutual funds adopted in 2002,\2\ the training element
appeared in the proposal amending the AML program requirements for
mutual funds to add a new requirement relating to customer due
diligence.\3\ In the final rule, however, the training element was
inadvertently omitted from 31 CFR 1024.210(b). The training element is
being reinserted by this correction document.
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\2\ 67 FR 21117, 21121 (April 29, 2002).
\3\ See 31 CFR 1024.210(b)(4) and (5) in the proposed rule
published August 4, 2014 (79 FR 45151, 45173).
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III. Administrative Procedure Act and Effective Date
Under 5 U.S.C. 553(b)(3)(B) of the Administrative Procedure Act
(APA), an agency may, for good cause, find (and incorporate the finding
and a brief statement of reasons therefore in the rules issued) that
notice and public comment procedure thereon are impracticable,
unnecessary, or contrary to the public interest. This correcting
document reinserts language inadvertently omitted from the ``Customer
Due Diligence Requirements for Financial Institutions'' final rule,
specifically the training element in the AML program rule for mutual
funds, and deletes a term and adds language that was inadvertently
omitted from the Certification Form which accompanied the final rule.
The agency has determined that publishing a notice of proposed
rulemaking and providing opportunity for public comment is unnecessary.
Under 5 U.S.C. 553(d)(3) of the APA, the required publication or
service of a substantive rule shall be made not less than 30 days
before its effective date, except, among other things, as provided by
the agency for good cause found and published with the rule. FinCEN
finds that there is good cause for shortened notice since the revisions
made by this final rule are minor, non-substantive, and technical. This
final rule takes effect September 28, 2017 with an applicability date
of May 11, 2018.
IV. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) does not apply to a rulemaking
where a general notice of proposed rulemaking is not required.\4\ As
noted previously, FinCEN has determined that it is unnecessary to
publish a notice of proposed rulemaking for this final rule.
Accordingly, the RFA's requirements relating to an initial and final
regulatory flexibility analysis do not apply.
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\4\ See 5 U.S.C. 603 and 604.
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V. Executive Order 13563 and 12866
FinCEN has determined that Executive Orders 13563 and 12866 do not
apply in this final rulemaking.
VI. Paperwork Reduction Act Notices
There are no collection of information requirements in this final
rule.
VII. Unfunded Mandates Act of 1995 Statement
Section 202 of the Unfunded Mandates Reform Act of 1995, 2 U.S.C.
1532 (Unfunded Mandates Act), requires that an agency must prepare a
budgetary impact statement before promulgating any rule likely to
result in a Federal mandate that may result in the expenditure by
State, local, and tribal governments, in the aggregate, or by the
private sector of $100 million or more in any one year. If a budgetary
impact statement is required, section 205 of the Unfunded Mandates Act
also requires an agency to identify and consider a reasonable number of
regulatory alternatives before promulgating a rule. FinCEN has
determined that no portion of this final rule will result in
expenditures by State, local, and tribal governments, or by the private
sector, of $100 million or more in any one year. Accordingly, this
final rule is not subject to section 202 of the Unfunded Mandates Act.
List of Subjects in 31 CFR Parts 1010 and 1024
Administrative practice and procedure, Banks, Banking, Brokers,
Counter money laundering, Counter-terrorism, Currency, Foreign banking,
Reporting and recordkeeping requirement, Securities, Terrorism.
Authority and Issuance
For the reasons set forth in the preamble, chapter X of title 31 of
the Code of Federal Regulations is amended as follows:
PART 1010--GENERAL PROVISIONS
0
1. The authority citation for part 1010 continues to read as follows:
Authority: 12 U.S.C. 1829b and 1951-1959; 31 U.S.C. 5311-5314
and 5316-5332; title III, sec. 314 Pub. L. 107-56, 115 Stat. 307;
sec. 701, Pub. L. 114-74, 129 Stat. 599.
0
2. In Sec. 1010.230, revise appendix A to read as follows:
Sec. 1010.230 Beneficial ownership requirements for legal entity
customers.
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PART 1024--RULES FOR MUTUAL FUNDS
0
3. The authority citation for part 1024 continues to read as follows:
Authority: 12 U.S.C. 1829b and 1951-1959; 31 U.S.C. 5311-5314
and 5316-5332; title III, sec. 314 Pub. L. 107-56, 115 Stat. 307;
sec. 701, Pub. L. 114-74, 129 Stat. 599.
0
4. In Sec. 1024.210:
0
a. Redesignate paragraph (b)(4) as paragraph (b)(5);
0
b. In newly redesignated paragraph (b)(5)(ii), remove the words
``paragraph (b)(4)(ii)'' and add in their place the words ``paragraph
(b)(5)(ii)''; and
0
c. Add a new paragraph (b)(4).
The addition reads as follows:
Sec. 1024.210 Anti-money laundering program requirements for mutual
funds.
* * * * *
(b) * * *
(4) Provide ongoing training for appropriate persons; and
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Dated: September 14, 2017.
Jamal El-Hindi,
Deputy Director, Financial Crimes Enforcement Network.
[FR Doc. 2017-20777 Filed 9-27-17; 8:45 am]
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