[Federal Register Volume 83, Number 247 (Thursday, December 27, 2018)]
[Rules and Regulations]
[Pages 66599-66601]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-27784]


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DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Parts 19 and 109


Notification of Inflation Adjustments for Civil Money Penalties

AGENCY: Office of the Comptroller of the Currency, Treasury.

ACTION: Notification of Monetary Penalties 2019.

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SUMMARY: The Office of the Comptroller of the Currency (OCC) is 
providing notice of its maximum civil money penalties as adjusted for 
inflation. The inflation adjustments are required to implement the 
Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by 
the Federal Civil Penalties Inflation Adjustment Act Improvements Act 
of 2015.

DATES: The adjusted maximum amount of civil money penalties in this 
document are applicable to penalties assessed on or after January 1, 
2019, for conduct occurring on or after November 2, 2015.

FOR FURTHER INFORMATION CONTACT: Lee Walzer, Counsel, Chief Counsel's 
Office, (202) 649-5490, or, for persons who are deaf or hearing 
impaired, TTY, (202) 649-5597, Office of the Comptroller of the 
Currency.

SUPPLEMENTARY INFORMATION: 
    This document announces changes to the maximum amount of each civil 
money penalty (CMP) within the OCC's jurisdiction to administer to 
account for inflation pursuant to the Federal Civil Penalties Inflation 
Adjustment Act of 1990 (the 1990 Adjustment Act),\1\ as amended by the 
Federal Civil Penalties Inflation Adjustment Act Improvements Act of 
2015 (the 2015 Adjustment Act).\2\ Under the 1990 Adjustment Act, as 
amended, federal agencies must make annual adjustments to the maximum 
amount of each CMP the agency administers. The Office of Management and 
Budget (OMB) is required to issue guidance to federal agencies no later 
than December 15 of each year providing an inflation adjustment 
multiplier (i.e. the inflation adjustment factor agencies must use) 
applicable to CMPs assessed in the following year. The agencies are 
required to publish their CMPs, adjusted pursuant to the multiplier 
provided by OMB, by January 15 of the applicable year.
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    \1\ Pub. L. 101-410, Oct. 5, 1990, 104 Stat. 890, codified at 28 
U.S.C. 2461 note.
    \2\ Pub. L. 114-74, Title VII, section 701(b), Nov. 2, 2015, 129 
Stat. 599, codified at 28 U.S.C. 2461 note.
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    To the extent an agency has codified a CMP amount in its 
regulations, the agency would need to update that amount by regulation. 
However, if an agency has codified the formula for making the CMP 
adjustments, then subsequent adjustments can be made solely by 
notice.\3\ In 2017, the OCC codified the formula for making CMP 
adjustments in its rules.\4\ In 2018, the OCC published a final 
regulation to remove the CMP amounts from its regulations, while 
updating those amounts for inflation through the notice process.\5\
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    \3\ See OMB Memorandum M-18-03, ``Implementation of the 2018 
Annual Adjustment Pursuant to the Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015'' at 4, which permits 
agencies that have codified the formula to adjust CMPs for inflation 
to update the penalties through a notice rather than a regulation.
    \4\ 82 FR 8584 (January 27, 2017).
    \5\ 83 FR 1517 (January 12, 2018) (final rule); 83 FR 1657 (Jan. 
12, 2018) (2018 CMP Notice).
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    On December 14, 2018, the OMB issued guidance to affected agencies 
on implementing the required annual adjustment, which included the 
relevant inflation multiplier.\6\ The OCC has applied that multiplier 
to the maximum CMPs allowable in 2018 for national banks and federal 
savings associations as listed in the 2018 CMP notice to calculate the 
maximum amount of CMPs that may be assessed by the OCC in 2019.\7\ 
There were no new statutory CMPs administered by the OCC during 2018.
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    \6\ The inflation adjustment multiplier for 2019 is 1.02522. See 
OMB Memorandum M-19-04, ``Implementation of Penalty Inflation 
Adjustments for 2019, Pursuant to the Federal Civil Penalties 
Inflation Adjust Act Improvements Act of 2015'' at 1 (Dec. 14, 
2018).
    \7\ Penalties assessed for violations occurring prior to 
November 2, 2015, will be subject to the maximum amounts set forth 
in the OCC's regulations in effect prior to the enactment of the 
2015 Adjustment Act.
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    The following charts provide the inflation-adjusted CMPs for use 
beginning on January 1, 2019, pursuant to 12 CFR 19.240(b) and 
109.103(c) for conduct occurring on or after November 2, 2015:

                 Penalties Applicable to National Banks
------------------------------------------------------------------------
                                                        Maximum Penalty
      U.S. Code Citation         Description and Tier      Amount (in
                                   (if applicable)        Dollars) \1\
------------------------------------------------------------------------
12 U.S.C. 93(b)...............  Violation of Various
                                 Provisions of the
                                 National Bank Act:
                                Tier 1...............             10,067
                                Tier 2...............             50,334
                                Tier 3...............      \2\ 2,013,399
12 U.S.C. 164.................  Violation of
                                 Reporting
                                 Requirements:
                                Tier 1...............              4,027
                                Tier 2...............             40,269

[[Page 66600]]

 
                                Tier 3...............      \2\ 2,013,399
12 U.S.C. 481.................  Refusal of Affiliate              10,067
                                 to Cooperate in
                                 Examination
12 U.S.C. 504.................  Violation of Various
                                 Provisions of the
                                 Federal Reserve Act:
                                Tier 1...............             10,067
                                Tier 2...............             50,334
                                Tier 3...............      \2\ 2,013,399
12 U.S.C. 1817(j)(16).........  Violation of Change
                                 in Bank Control Act:
                                Tier 1...............             10,067
                                Tier 2...............             50,334
                                Tier 3\2\ 2,013,399..
12 U.S.C. 1818(i)(2) \3\......  Violation of Law,
                                 Unsafe or Unsound
                                 Practice, or Breach
                                 of Fiduciary Duty:.
                                Tier 1...............             10,067
                                Tier 2...............             50,334
                                Tier 3...............      \2\ 2,013,399
12 U.S.C. 1820(k)(6)(A)(ii)...  Violation of Post-
                                 Employment
                                 Restrictions:
                                Per violation                    331,174
12 U.S.C. 1832(c).............  Violation of
                                 Withdrawals by
                                 Negotiable or
                                 Transferable
                                 Instrument for
                                 Transfers to Third
                                 Parties:
                                Per violation                      2,924
12 U.S.C. 1884................  Violation of the Bank                292
                                 Protection Act
12 U.S.C. 1972(2)(F)..........  Violation of Anti-
                                 Tying Provisions
                                 regarding
                                 Correspondent
                                 Accounts, Unsafe or
                                 Unsound Practices,
                                 or Breach of
                                 Fiduciary Duty:
                                Tier 1...............             10,067
                                Tier 2...............             50,334
                                Tier 3...............      \2\ 2,013,399
12 U.S.C. 3110(a).............  Violation of Various              46,013
                                 Provisions of the
                                 International
                                 Banking Act (Federal
                                 Branches and
                                 Agencies):
12 U.S.C. 3110(c).............  Violation of
                                 Reporting
                                 Requirements of the
                                 International
                                 Banking Act (Federal
                                 Branches and
                                 Agencies):.
                                Tier 1...............              3,682
                                Tier 2...............             36,809
                                Tier 3...............      \2\ 1,840,491
12 U.S.C. 3909(d)(1)..........  Violation of                       2,505
                                 International
                                 Lending Supervision
                                 Act
15 U.S.C. 78u-2(b)............  Violation of Various
                                 Provisions of the
                                 Securities Act, the
                                 Securities Exchange
                                 Act, the Investment
                                 Company Act, or the
                                 Investment Advisers
                                 Act:
                                Tier 1 (natural                    9,472
                                 person)--Per
                                 violation.
                                Tier 1 (other                     94,713
                                 person)--Per
                                 violation.
                                Tier 2 (natural                   94,713
                                 person)--Per
                                 violation.
                                Tier 2 (other                    473,566
                                 person)--Per
                                 violation.
                                Tier 3 (natural                  189,427
                                 person)--Per
                                 violation.
                                Tier 3 (other                    947,130
                                 person)--Per
                                 violation.
15 U.S.C. 1639e(k)............  Violation of
                                 Appraisal
                                 Independence
                                 Requirements:
                                First violation......             11,563
                                Subsequent violations             23,125
42 U.S.C. 4012a(f)(5).........  Flood Insurance:.....
                                Per violation........              2,187
------------------------------------------------------------------------
\1\ The maximum penalty amount is per day, unless otherwise indicated.
\2\ The maximum penalty amount for a national bank is the lesser of this
  amount or 1 percent of total assets.
\3\ These amounts also apply to CMPs in statutes that cross-reference 12
  U.S.C. 1818, such as 12 U.S.C. 2804, 3108, 3349, 4309, and 4717 and 15
  U.S.C. 1607, 1693o, 1681s, 1691c, and 1692l.


          Penalties Applicable to Federal Savings Associations
------------------------------------------------------------------------
                                                        Maximum Penalty
      U.S. Code Citation           CMP Description         Amount (in
                                                          Dollars) \1\
------------------------------------------------------------------------
12 U.S.C. 1464(v).............  Reports of Condition:
                                1st Tier.............              4,027
                                2nd Tier.............             40,269
                                3rd Tier.............      \2\ 2,013,399
12 U.S.C. 1467(d).............  Refusal of Affiliate              10,067
                                 to Cooperate in
                                 Examination
12 U.S.C. 1467a(r)............  Late/Inaccurate
                                 Reports:.
                                1st Tier.............              4,027
                                2nd Tier.............             40,269
                                3rd Tier.............      \2\ 2,013,399
12 U.S.C. 1817(j)(16).........  Violation of Change
                                 in Bank Control Act:
                                Tier 1...............             10,067
                                Tier 2...............             50,334

[[Page 66601]]

 
                                Tier 3...............      \2\ 2,013,399
12 U.S.C. 1818(i)(2) \3\......  Violation of Law,
                                 Unsafe or Unsound
                                 Practice, or Breach
                                 of Fiduciary Duty
                                Tier 1...............             10,067
                                Tier 2...............             50,334
                                Tier 3...............      \2\ 2,013,399
12 U.S.C. 1820(k)(6)(A)(ii)...  Violation of Post-
                                 Employment
                                 Restrictions:
                                Per violation........            331,174
12 U.S.C. 1832(c).............  Violation of
                                 Withdrawals by
                                 Negotiable or
                                 Transferable
                                 Instruments for
                                 Transfers to Third
                                 Parties:
                                Per violation........              2,658
12 U.S.C. 1884................  Violation of the Bank                292
                                 Protection Act.
12 U.S.C. 1972(2)(F)..........  Violation of
                                 Provisions regarding
                                 Correspondent
                                 Accounts, Unsafe or
                                 Unsound Practices,
                                 or Breach of
                                 Fiduciary Duty:.
                                Tier 1...............             10,067
                                Tier 2...............             50,334
                                Tier 3...............      \2\ 2,013,399
15 U.S.C. 78u-2(b)............  Violations of Various
                                 Provisions of the
                                 Securities Act, the
                                 Securities Exchange
                                 Act, the Investment
                                 Company Act, or the
                                 Investment Advisers
                                 Act:
                                1st Tier (natural                  9,472
                                 person)--Per
                                 violation.
                                1st Tier (other                   94,713
                                 person)--Per
                                 violation.
                                2nd Tier (natural                 94,713
                                 person)--Per
                                 violation.
                                2nd Tier (other                  473,566
                                 person)--Per
                                 violation.
                                3rd Tier (natural                189,427
                                 person)--Per
                                 violation.
                                3rd Tier (other                  947,130
                                 person)--Per
                                 violation.
15 U.S.C. 1639e(k)............  Violation of
                                 Appraisal
                                 Independence
                                 Requirements:
                                First violation......             11,563
                                Subsequent violations             23,125
42 U.S.C. 4012a(f)(5).........  Flood Insurance:
                                Per violation........              2,187
------------------------------------------------------------------------
\1\ The maximum penalty amount is per day, unless otherwise indicated.
\2\ The maximum penalty amount for a federal savings association is the
  lesser of this amount or 1 percent of total assets.
\3\ These amounts also apply to statutes that cross-reference 12 U.S.C.
  1818, such as 12 U.S.C. 2804, 3108, 3349, 4309, and 4717 and 15 U.S.C.
  1607, 1681s, 1691c, and 1692l.


    Dated: December 18, 2018.
Bao Nguyen,
Acting Senior Deputy Comptroller and Chief Counsel, Office of the 
Comptroller of the Currency.
[FR Doc. 2018-27784 Filed 12-26-18; 8:45 am]
 BILLING CODE 4810-33-P